Residential Proxy Acquisition: Worst Practices

The proxy industry is relatively new, but business is booming as a growing number of businesses turn to proxy networks for the tools they need to gather business intelligence, test advertising campaigns, and evaluate the effectiveness of SEO strategies.

For both organizations and individual users, proxy networks promise anonymity and cover from website security systems and bot detectors. Residential IP proxies from legitimate users are the “gold standard” of proxy types, so proxy providers resort to a variety of tactics to acquire them. Residential proxy acquisition can be ethical and transparent, highly shady, or downright illegal, so knowing the worst practices used to acquire residential proxies can protect both proxy users and providers from the dark and dangerous side of using residential proxies.

Why Are Residential Proxies In Demand?

Proxy Internet Prtocol (IP) addresses can help any Internet user browse anonymously and get access to content that’s georestricted, or not available in certain parts of the world. For marketers and anyone hoping to raise awareness about a product or service, proxies can enable fast browsing of multiple websites or a single site in a short time – activities that would normally attract the attention of a website’s bot detectors or other security features.

Every device connected to the internet from a legitimate location is assigned an IP address by an established Internet Service Provider (ISP). That residential IP not only identifies the user’s device during online activity, it also carries a considerable amount of personal data. Protecting that IP and the accompanying data is one reason users turn to proxy networks, which assign other IP addresses from different locations in order to conceal an internet user’s actual IP.

In the same way, businesses use proxies for high-volume searching and web scraping in order to appear like typical individual Internet users. With a group of residential proxy IPs that rotate with every search, these users can avoid detection by website security and collect the data they need to plan marketing strategies and track the performance of content and advertising.

Proxy IPs can also be generated by data centers. Data center proxies can also cloak a user’s actual identity online, but because they aren’t legitimate IPs assigned by ISPs, they’re more easily flagged as bots by target websites. That can lead to blocking and bans, which neutralizes the effectiveness of proxies for collecting information such as marketing data and SEO statistics.

Because residential IP addresses are legitimate IPs that belong to actual Internet users, this kind of IP is the most effective proxy for staying anonymous on the Web – and the most valuable. For proxy providers, acquiring quality residential IP addresses is a key strategy for business success, and the best practices for doing so can protect both providers and the clients they serve. But the worst practices for residential proxy acquisition not only exploit residential IP owners and put them at risk, but they also damage provider reputations and raise a range of legal and ethical issues.

Acquiring Residential IPs: Best Practices

Because residential IPs belong to real users, the most ethical and practical way to acquire their use in proxy networks is with the full knowledge and consent of those users. Allowing a real IP address to be used by a proxy provider is not risk-free, but for some users, the rewards outweigh the risks.

Cybersecurity experts estimate that about 30 percent of cybercrimes involve residential IPs that have been hijacked or misused by scammers and other cybercriminals. Because assigned IP addresses are in public databases, anyone can look up the owner of an address and learn a considerable amount of personal data, including their physical address and online contact information.

When that IP appears in any internet activity, online bad actors can track the IP back to its owner and easily capture that information for identity theft and other illegal activity. Even if the IP is used in a proxy network, the actual owner can be held responsible for any illegalities that arise from it. Residential IPs are frequently implicated in chargebacks—situations in which funds are removed from a merchant’s account due to a fraudulent charge. Captured residential IPs can also be bundled for use in automated cyberattacks that involve flooding a site with traffic.

Nevertheless, many Internet users are entirely willing to loan out their own residential IP addresses to proxy providers. In the best possible practice, the proxy provider compensates these users for making the IP and their unused bandwidth available to the network for a fee. Even when that doesn’t happen, the fairest and most responsible way to acquire residential IPs for proxy use is with the full awareness and consent of the original address owner.

Residential IPs can also be provided by ISPs themselves. In that way, no residential end users are involved in the process, and there is no need to gain consent for the use of the IPs. But in the race to feed the growing demand for proxy networks, many players in the relatively new and largely unregulated proxy marketplace are turning to the worst, rather than the best, ways to acquire these highly desirable IP addresses.

Acquiring Residential IP Addresses: Worst Practices

Although acquiring residential IPs with owner consent is regarded as the safest and most ethical approach to populating proxy networks, it can take effort and time so some proxy providers turn to methods that are both unethical and illegal to capture the IPs they want.

A user’s residential IP address can be captured when the user installs a platform or app that comes with a hidden agenda. Proxy providers can request that developers add the provider’s code to software that people already use, allowing IPs to be captured without users’ knowledge or consent.

In other cases, a newly installed app or platform may include a “consent” form for using the IP that is either highly misleading or entirely false, so that the user doesn’t realize that they’re making their IP address available for a proxy network. In this shady maneuver, the proxy network can still claim that the IP owner was duly informed and gave consent, even though that may not have been clear to them at the time.

In an even darker scenario, malware can infect the target user’s computer and automatically connect the computer’s IP address to a proxy network - entirely without the owner’s knowledge or consent. In this way, the IP’s legitimate owner becomes an unwilling participant in the network while still facing potential liability for any abuses that come from the use of the IP.

Avoiding the Risks of the Worst Practices

Working with unethical proxy providers can put businesses at risk of damage to their brand and reputation, as well as expose them to potential legal consequences. To minimize those risks, it’s important to avoid free and low-cost proxy providers, since these are more likely to populate their networks with IPs collected through malware and questionable apps. Security experts also recommend using a reputable proxy provider that uses encryption to protect IP addresses and other data.

Proxies are an indispensable tool for marketers, researchers, and businesses in today’s global marketplace, but unethical and illegal practices for acquiring proxy IPs can be common. A quality proxy service can provide the legitimate residential IP proxies that help businesses of all kinds obtain the insights and intelligence they need to build brands and stay competitive.

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