The coronavirus outbreak has led to a surge in demand for VPNs across the globe, and this trend is set to intensify as more people are forced to work from home in efforts to contain the pandemic.

VPNs, or virtual private networks, provide an encrypted connection that allows users to securely connect to networks over the public internet. Many companies and organizations rely on these secure connections to ensure that only designated users are able to access their networks remotely.

Although VPN usage has been common for a while, most use-cases have involved remote employees who do not usually make up the bulk of a typical workforce. However, the virus has changed this dynamic, resulting in a massive uptick of virtual users who require VPN services. Analysts and industry insiders expect this demand will lead to challenges that will need to be addressed both by enterprises and by VPN providers themselves.

VPNs and remote-access servers can provide full-time teleworkers secure, high-speed connections similar to those available in the main office. Persistent, high-speed connections are more expensive than those that connect briefly for email, so companies rarely build in extra capacity to accommodate temporary spikes in usage.

According to a recent study conducted by VPN provider Atlas VPN, VPN usage in the U.S. increased 53% week over week for the seven days ended March 15. And it was up 112% in Italy, a country that has been particularly hard hit by the coronavirus. Atlas VPN estimates usage in the U.S. will increase by more than 150% year over year by the end of March.

"Overall, the usage of VPNs should continue to surge if the coronavirus pandemic worsens," said Rachel Welch, chief operating officer of Atlas VPN.

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Other VPN providers contacted by S&P Global Market Intelligence confirmed that they are experiencing similar trends.

"We have certainly seen an increase in customer usage, both in new customers and in current customers looking to expand their remote work capacity," said Francis Dinha, founder and CEO of OpenVPN Technologies Inc.

Scott Gordon, chief marketing officer of Pulse Secure LLC, said that beyond an uptick in sales, his company is also seeing more of its customers consolidate their secure access capabilities into one platform rather than support purchases made through several different VPN vendors. "This offers enterprises not only better operational control and economies, but also allows them to be more efficient during these emergencies," Gordon said.

Garrett Bekker, principal security analyst at 451 Research, said the unprecedented volume of employees working from home could place enormous strains on many firms' remote access infrastructure, which could have both positive and negative effects on the VPN market.

The positive is increased sales and revenue. "However, sustained reliance on VPNs can also expose their limitations, and perhaps force firms to re-think their long-term remote access plans," Bekker said.

One of these limitations, according to Bekker, is that from a security perspective, VPNs can provide wide access to entire network segments, in the process often allowing users to access more than they typically require to do their jobs. Although some modern VPN solutions have workarounds for this issue, they still require a great deal of configuration from the administrator, resulting in potential complications that are further exacerbated when factoring in the ballooning number of users.

Companies using VPNs also have to contend with the fact that the services they use can only support a finite number of users, Bekker said.

"Most companies have not historically given VPN access to their entire workforce, so it's safe to say that the services they use are not really set up to suddenly accommodate so many people," he explained.

To handle a sudden influx of users, companies have to purchase additional hardware and also buy additional licenses from their VPN provider. However, dealing with the sudden uptick in demand could prove to be challenging for many providers, according to OpenVPN's Dinha.

"Some VPNs are based on proprietary hardware that can only manage a certain number of users," Dinha said. "If you throw thousands of new users on hardware that can only manage 200, there are certainly going to be issues."

Dinha said OpenVPN's own solution can easily scale to support a larger number of users. But he added that keeping up with the demand from existing customers for new VPN licenses is a trickier prospect.

"Simply making sure those customers have the configuration they need can be a challenge because managing a remote team of 20 workers versus 2,000 comes with significant setup differences for businesses," Dinha said.

Looking ahead, Bekker said it remains to be seen whether the increased focus on VPNs will extend beyond the outbreak. "Those who had previously been attached to an office may find that, not only is the remote experience satisfactory, they may prefer it to coming into the office or that they no longer want to surrender the hours lost to commuting," Bekker said, adding that this could have long-term implications for VPN providers.

451 Research is an offering of S&P Global Market Intelligence.