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Hola is a freemium web and mobile application which provides a form of virtual private network services to its users through a peer-to-peer network. It also uses peer-to-peer caching. When a user accesses certain domains that are known to use geo-blocking, the Hola application redirects the request to go through the computers and Internet connections of other users in non-blocked areas, thereby circumventing the blocking. This also means that other users might access the Internet through one's own computer, and that part of one's upload bandwidth might be used for serving cached data to other users. Paying users can choose to redirect all requests to peers but are themselves never used as peers.
In 1998, Ofer Vilenski and Derry Shribman founded KRFTech, a software development tools company. With the profits from the company, they started Jungo in 2000 to develop an operating system for home gateways. In 2006 NDS (Cisco) acquired Jungo for $107 million.
In 2008, Vilenski and Shribman started investigating the idea of re-inventing HTTP by building a peer-to-peer overlay network that would employ peer-to-peer caching to accelerate content distribution and peer-to-peer routing to make the effective bandwidth to target sites much faster. This would make the Internet faster for users and cheaper to operate for content distributors. They started up Hola with $18 million from investors such as DFJ (Skype, Hotmail), Horizons Ventures (Mr. Li Ka-Shing's fund), Magma Venture Partners (Waze), Israel's Chief Scientist Fund, and others.
Hola Networks Limited launched their network in late 2012, and it became viral in January 2013 when consumers started using Hola for Internet privacy and anonymity by utilizing the P2P routing for IP masking. "After being around for two months with 80 downloads a day, on January 23rd 2013, at 5PM Israel time, the product was good enough. That was the second it took off, and went up overnight to 40,000 downloads a day", Vilenski told Startup Camel.
In late 2014, Hola Networks began selling access to its huge userbase as exit nodes, under the name Luminati. They charge $20 per gigabyte for bandwidth that is actually coming from their VPN users—they do not pay for the bandwidth at all. Every Hola user is actually functioning as an exit node in a huge botnet.
The Hola company claims the following: "The Internet is slowed down by server response times, Internet congestion, round trip times, and poorly written communication stacks in operating systems. Hola removes these bottlenecks by securely caching content on peers as they view it, and later serving it up to other nearby peers as they need it. Hola also compresses communication between peers to further speed the net."
Hola is distributed as a client-side browser-based application. It is available for all major browsers such as Chrome, Firefox, Internet Explorer, Opera as browser add-on, extension, or application, and it works on PC based operating systems as well as Mac OS X. Hola has also released an Android application and most recently an iPhone and iPad application.
In May 2015, Hola came under criticism from 8chan founder Frederick Brennan after the site was reportedly attacked by exploiting the Hola network, as confirmed by Hola founder Ofer Vilenski. After Brennan emailed the company, Hola modified its FAQ to include a notice that its users are acting as exit nodes for paid users of Hola's sister service Luminati. "Adios, Hola!", a website created by nine security researchers and promoted across 8chan, states: "Hola is harmful to the internet as a whole, and to its users in particular. You might know it as a free VPN or "unblocker", but in reality it operates like a poorly secured botnet - with serious consequences." Much of the criticism against Hola stems from the fact that many free users are unaware that their bandwidth is being used by other users or is being resold to users of Luminati. Other criticism stems from vulnerabilities inherent to the software, which could allow an attacker to deliver malware to Hola users. Hola browser has also been used for DDOS attacks.
In response to the criticism, Vilenski told Business Insider, "[we have been] listening to the conversations about Hola and while we think we've been clear about what we are doing, we have decided to provide more details about how this works, and thus the changes [to the website] in the past 24 hours". According to the security researchers who performed the audit, Hola updated its software, but the vulnerabilities remain.
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