What is a Closed Network? Key Differences and Selection Tips for Dedicated Lines and VPNs

In today’s corporate networks, it is crucial to establish a secure and efficient communication environment.

Among the options, “closed networks” are gaining attention as a viable solution.

This article explains the types of closed networks, the differences between dedicated lines and VPNs, and security aspects, and organizes the key points for selection.

What is a Closed Network? What Types Are There?
1. What is a Closed Network?
2. Dedicated Line
3. Internet VPN
4. IP-VPN
5. Wide Area Ethernet
Differences, Advantages, and Disadvantages of Dedicated Lines and VPNs
1. What are the differences between dedicated lines and VPNs in a closed network?
2. Comparing Advantages and Disadvantages
How Secure is a Closed Network?
1. Security Risks in Closed Networks
2. Security Measures for Closed Networks

Summary

1. What is a Closed Network? What Types Are There?

A closed network refers to a private network used by companies and organizations to securely share information and communicate.

Here, we will understand the basics of closed networks and explain them by dividing them into several types.

1-1. What is a Closed Network?

A closed network is a network environment for communication between specific users, rather than a publicly accessible network like the Internet. It is used to protect internal corporate communications and data exchange between locations and to enhance security.

To implement a closed network, the following four types of mechanisms are generally used:

Dedicated Line
Internet VPN
IP-VPN
Wide Area Ethernet

1-2. Dedicated Line

A dedicated line is a type of closed network that uses physical communication lines provided by telecommunications carriers.

Dedicated lines have stable communication speeds and can ensure high security because access from outside is restricted. However, the high cost is a challenge.

1-3. Internet VPN

An Internet VPN is a method of ensuring security by encrypting communication while using the regular Internet. It can be implemented at a lower cost than a dedicated line, but communication quality and stability depend on the Internet environment.

1-4. IP-VPN

IP-VPN is a service that builds a VPN using the network of a telecommunications carrier.

It is characterized by higher stability and enhanced security compared to Internet VPNs. It does not cost as much as a dedicated line and is adopted by a wide range of companies.

1-5. Wide Area Ethernet

Wide Area Ethernet is a service that provides a wider range of network connections while based on Ethernet technology applied to LANs. It enables high-quality communication because it can efficiently transmit large amounts of data at high speed. However, the complex settings and the need for specialized expertise in operation and management are challenges.

2. Differences, Advantages, and Disadvantages of Dedicated Lines and VPNs

Dedicated lines and VPNs each have their own characteristics and challenges.

Which one is more suitable depends on the purpose of use and budget, so it is important to understand the differences thoroughly.

2-1. What are the differences between dedicated lines and VPNs in a closed network?

A dedicated line, which uses physical communication lines, ensures high-speed communication and reliability and is a network connection method for transferring data between multiple locations.

Financial institutions, for example, use dedicated lines to connect multiple locations and achieve high-speed financial transactions.

In contrast, a VPN is a technology that provides communication with high security by constructing a virtual network tunnel between two points that send and receive data.

The data exchanged is protected by encryption technology, enabling remote access and wide area network connections as if connected by a dedicated line.

2-2. Comparing Advantages and Disadvantages

Let’s organize the advantages and disadvantages of dedicated lines and VPNs.

・Advantages of Dedicated Lines

Dedicated lines use physically dedicated communication lines, so they are not affected by other users and can maintain stable communication speeds. This characteristic allows them to exhibit excellent performance in situations where large amounts of data communication and real-time communication are required.

Furthermore, because dedicated lines are physically isolated from external networks, security is very high, minimizing the risk of data eavesdropping and tampering.

・Disadvantages of Dedicated Lines

The high cost of using dedicated lines can be considered a disadvantage. Usage fees to telecommunications carriers and installation costs for newly laying lines can be high, not only for initial costs but also for running costs.

Also, the installation of dedicated lines requires the laying of physical lines, which takes time and effort. The same applies when adding new locations.

・Advantages of VPNs

VPNs have the advantage of significantly reducing communication costs compared to dedicated lines. Because they utilize existing Internet lines, there is no need for dedicated physical lines, making them economical.

In addition, they can provide an environment where employees working remotely and external business partners can safely access the network. Furthermore, they are easy to install and operate, and network expansion and changes can be carried out smoothly, making them highly flexible.

・Disadvantages of VPNs

On the other hand, VPNs are accompanied by security concerns. When using the Internet, appropriate security measures such as data encryption and access control are essential.

Also, communication speeds are affected by the condition of the Internet line, so speed reductions may occur during peak hours or when bandwidth is limited.

2-3. Compliance with Laws and Regulations

Compliance with the Personal Information Protection Act is also a social responsibility imposed on companies.

If there are any revisions to laws or changes to guidelines, companies are required to promptly review their own responses.

In addition, companies with overseas transactions need to comply with regulations regarding the protection of personal information in each country, such as the GDPR (EU General Data Protection Regulation). Complying with laws and regulations is an important foundation for enhancing corporate credibility.

3. How Secure is a Closed Network?

Closed networks are expected to have high security because access from outside is restricted compared to networks that use the Internet. However, if appropriate management and operation are not carried out, security risks increase.

Therefore, users of closed networks must deeply understand the risks and countermeasures and thoroughly implement preventive measures.

3-1. Security Risks in Closed Networks

Let’s understand that the following security risks exist in closed networks:

・Unauthorized Access from Inside

Even though communication is limited within a closed network, there is a risk that internal employees may intentionally or accidentally attempt unauthorized access. In particular, if access privileges are not properly managed, important data may be leaked.

・Configuration Errors

Vulnerabilities in the closed network may be exposed due to misconfiguration of network devices or security settings. Examples include firewall misconfigurations or unnecessary ports being left open.

・Device Vulnerabilities

The devices connected to the closed network themselves may be targeted by cyberattacks. In particular, if software or firmware is not updated to the latest version, attackers may exploit vulnerabilities to infiltrate the closed network.

・External Attacks

Although closed networks are strong against direct attacks because they are isolated from the outside, they may be subject to indirect risks due to supply chain attacks or targeted attacks.

3-2. Security Measures for Closed Networks

To operate a closed network safely, it is important to thoroughly implement the following measures:

・Strengthening Authentication and Access Control

To ensure that only authorized users can access the closed network, implement multi-factor authentication (MFA) and strong password policies. Also, set appropriate access privileges for each user and restrict unnecessary access.

・Encryption of Communication and Data

To protect communication content, use VPNs and encryption protocols (e.g., TLS, IPSec). Also, encrypting and storing data within the terminal can serve as a countermeasure in the event of leakage. This will reduce the risk of data within the closed network being eavesdropped on or tampered with.

・Regular Monitoring and Operation Management

Introduce a system to monitor the entire network and detect suspicious access or abnormal communication in real time. Also, perform regular log analysis to detect potential threats early. In operation management, it is important to quickly perform updates and patch applications.

・Implementation of Security Education

To minimize internal risks, education for employees and related parties is essential. Reduce human risks by ensuring awareness of phishing attacks and compliance with security rules.

Summary

Closed networks are effective as a means of strengthening the security of corporate networks and realizing efficient communication.

Options such as dedicated lines and VPNs each have their own advantages and disadvantages, and it is necessary to select the appropriate method according to the company’s budget and needs. In addition, fully understanding the security risks in closed networks and taking appropriate measures is key to safe network operation.

Please contact globalsupport@jiran.com for further assistance.