An extranet requires security and privacy. These can include firewall server management, the issuance and use of digital certificates or similar means of user authentication, encryption of messages, and the use of virtual private networks (VPNs) that tunnel through the public network.
Companies can use an extranet to:
- Exchange large volumes of data using Electronic Data Interchange (EDI)
- Share product catalogs exclusively with wholesalers or those "in the trade"
- Collaborate with other companies on joint development efforts
- Jointly develop and use training programs with other companies
- Provide or access services provided by one company to a group of other companies, such as an online banking application managed by one company on behalf of affiliated banks
- Share news of common interest exclusively with partner companies