"Collecting metadata is technically complicated and expensive, and based on other countries' experience it cannot help in effectively fighting crime," he said.

When Wangle began building its $4.99 per month VPN after it reverse-listed on the ASX in 2015, it had no intention of ever letting the Government or Federal Police rifle through the metadata of customers, as such agencies can now apply to courts to do.

"We'd built our VPN to be like Fort Knox, then nine months ago the regulator came knocking," said Mr Smith.

The Australian Communications & Media Authority had deemed the VPN that Wangle had just put into the app stores to be a 'carrier' of data for the purpose of the Telecommunication Act, so as an Australian company it would have to obey the amendments which had passed Parliament in 2015 and allow that data to be interrogated.

Wangle CEO Sean Smith: ACMA-compliant, and content Supplied

Wangle's VPN faced a complete re-engineering, its share price fell from 5 cents back to the 2 cents it had started on, and the staff who had been stretching its $4.3 million raising for two years without revenue had to stretch some more.

Starting over again was harder for Wangle than it would be for most VPNs, which are built on two major open-source platforms, OpenVPN or OpenSSL. Wangle's was built from the ground up using patented "network optimisation" technology, allowing it to attain a speed which independent testing from PwC claimed to have found up to twice as fast as OpenVPN.

The "interrogation" of the data now allowed by the ACMA-enforced rebuild of Wangle's VPN would allow it to become even faster, said Mr Smith, thanks to better understanding of network traffic in real time.


He stressed that the data of users would not be freely available to outside agencies.

"The data is secured, encrypted and anonymised. The keys that link it to people are in a separate database that the Goverment has to go through the courts to get, so it's not open slather," Mr Smith said.

However the Wangle VPN's ACMA compliance meant it would probably not appeal to those attracted to the "dark side" of VPNs, said Mr Smith.

"The guys who want to use a VPN to spoof their location, grab content they shouldn't have, or hack, we're not interested in them. And if Netflix US came to us and said traffic from your IP range was flooding into our servers, we'd follow it up and disconnect repeat offenders," he said.

Wangle's market would be for "good VPN users", Mr Smith said, such as individuals wanting a way to access wi-fi free from hacker threats, and corporates providing remote staff a secure way to access their intranet.

He added that Wangle would never inject malware or 'malvertising' - software designed to damage or gain access to a users' information - as a recent CSIRO study of 283 offshore VPNs found 38 per cent had done.

A new net nanny

Potential new sources of revenue had been opened by the ability to intercept encrypted data, he added. Wangle has formed a partnership with Perth's Telethon Kid's Institute to develop a web monitoring tool for parents, using algorithms to pick up "troubling" network activity.


"For instance a sure sign of cyberbullying is a huge drop off in traffic to certain social media sites. We can tell if someone's been hiding a phone in bed and using it all night, which can be a red flag for predatory behaviour," Mr Smith explained.

The tool, to be called Wangle Family Insites, worked better than content-blocking solutions for parents, as they tended to only work on the home network, and teenage internet use was now mainly mobile, Mr Smith said.

"The alternative today is spyware, which erodes trust, and kids still find a way around it."

Wangle's product for parents interrogated only the metadata generated by children, and never made available the content they were seeing itself, Mr Smith added.