What can done with a Proxy Server
First what is a proxy server:
In computer networks, a proxy server is a server (a computer system or an application) that acts as an intermediary for requests from clients seeking resources from other servers. A client connects to the proxy server, requesting some service, such as a file, connection, web page, or other resource available from a different server. The proxy server evaluates the request according to its filtering rules. For example, it may filter traffic by IP address or protocol. If the request is validated by the filter, the proxy provides the resource by connecting to the relevant server and requesting the service on behalf of the client. A proxy server may optionally alter the client's request or the server's response, and sometimes it may serve the request without contacting the specified server. In this case, it 'caches' responses from the remote server, and returns subsequent requests for the same content directly.
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Is this not what you talked about in your article about VPN's? No a VPN is different then a proxy server for the primary reason your data is encrypted prior arrival and when it is sent back. Thus what actual traffic is being sent is unknown to the internet service provider and the world. This is an just sending your data via another route. This is just sending your data via an unsecured means through another computer so your location is unknown.
What can you do with a proxy server.
Primarily a proxy will hide your location on the internet. So if not knowing your location is important then a proxy server is the way to go. I use a proxy server to stream media from the internet. I use a pay service to do this with Hide My Net. It cost $5 a month and works with Hulu and other restricted data. As Videos from Youtube, Itunes Amazon and many others restrict your ability to go on those sites.
Where can I get a Free Proxy Server.
Remember that if you use a free proxy server they may be capturing your data. This is a risk. However if it is just to see Videos or surf geo restricted sites. Then there are sites out there you can set up a free proxy server through.
Here are a few lists of free proxy servers:
IP List by Country
How do I set-up Proxy server with Browser.
For Browsers I like to use programs that Automatically switch between the Proxy and the Direct Connection.
In FireFox I use:
In Chrome I use
In IE I use
Is what to do about desktop applications that need access to the internet. What can I do about those applications that do not have have way to setup a proxy. I use a program called Proxifier to route all traffic through this. http://www.proxifier.com/
However remember that with free proxy servers you do not know who is capturing your data. This is not a secure way to send any data. It is highly not recommended. USE ONLY FOR SURFING AND STREAMING...