Residential and Datacenter Proxies: The Motives Behind Price Differences

The more the amount of data generated, the greater the need to find the most efficient and cost-effective ways to gather this data.

Data is necessary for brand growth and the more access a company has to use market data, the more advantage it has to compete in the global market.

When looking for ways to gather this data, organizations usually have to use tools and resources such as proxies and web scrapers.

Presently, the choice of proxy usually revolves around data center or residential proxies, and in this article, we will consider what they are and how they differ in application.

What Is A Proxy?

A proxy can be defined as a tool to conceal users’ identities from the internet. The software can sit anywhere between a user and a target server and conceal the user’s identity while using its internet protocol (IP) address and location from the servers and onlookers.

This way, proxies are responsible for the security and anonymity of those that use them. Proxies also help clear obstacles and limitations from the path while making operations faster and more organized.

Additionally, proxies are well known for using cache mechanisms to store data and prevent similar requests from reaching the target servers every time. This reduces the time used for performing operations while decreasing the load placed on servers.

Proxy users are not only able to access the internet in the most secure way but are also able to bypass restrictions and gather any content regardless of where they reside.

Datacenter vs. Residential Proxies

Based on the type of IP address that proxies use, we generally classify them into the data center or residential proxies.

Datacenter proxies are defined as proxies owned by a third-party company of Local Internet Registries (LIRs) such as network operators. And web hosting providers

They are not affiliated with Internet Service Providers (ISPs) and come equipped with IPs that are not tied to any physical location.

While how their IPs are allocated may make them very susceptible to blocking on certain platforms (since they are seen as bots and not regular users), they are the fastest and most effective type of proxies.

They offer unrivaled connection speed, high performance, and increased productivity and are generally very affordable.

Residential proxies, on the other hand, are proxies that are owned by ISPs and equipped with IPs that are tied to actual residences.

This means they rarely get banned during operations and have IPs that can be routinely changed to avoid online limitations.

However, they are slower than datacenter proxies and are generally more expensive with lower performance.

Motives and Use Cases of Datacenter Proxies

Aside from the basic difference in their definition and how they function, data center and residential proxies also differ in how they are used.

Some of the use cases of data center proxies include:

  • Web Scraping

Web scraping allows you to collect a large dose of useful data from different sources and data center proxies fit perfectly for this task.

They can be used to collect market trends, monitor prices, and the competition, and collect vital information that can help to protect the brand.

  • Social Media Management

Social media management requires tracking and collecting important data such as keywords, ads, and content from competitors’ websites. And data center proxies can do all of these without inducing blocks or looking suspicious.

  • Bypassing Geo-Restrictions

Datacenter proxies can also be used to easily bypass geo-restrictions which are often used to deny access to users from certain regions.

Datacenter proxies provide IPs and locations that users can choose and appear differently online.

Motives and Use Cases of Residential Proxies

The following are some of the most common use cases of residential proxies:

  • Market Research

Keeping an eye on the market trends is critical to how well your business will grow, and in most cases, to do this, you will need to visit multiple marketplaces in one day.

Residential proxies offer you the chance to use real-life IPs for this to prevent getting banned.

  • Web Testing

Ensuring that your website is functioning correctly is tantamount to its success. Using residential proxies rotating at random or fixed intervals allows you to test your website from different locations without physically being in those locations. Additionally, residential proxies can help improve the anonymity of your web testing by masking your address and making your activity more challenging to track.

  • Price Monitoring

To understand whether your prices are right or whether you need to make some adjustments, you need to collect product prices from various websites.

Doing this will not only inform your decision but will also help you set the best price that strikes a balance between retaining customers and keeping profit margins up.

Using residential IPs to do this makes the target sources assume a real user is requesting such information.

  • Academic Research

Those who perform academic research often have to collect accurate data from multiple websites simultaneously.

Residential proxies allow the researcher to visit as many websites as necessary without getting blocked while being reliable enough to allow the user to navigate multiple sources at once.


Residential and datacenter proxies exist to allow users to choose what tool to use in navigating the internet.

While residential proxies come with a more valid IP address and are more reliable, datacenter proxies are cheaper, faster, and grant a better performance level.

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