Don’t be startled, you guessed it right, the above is indeed gibberish. And that’s how your ISP sees your VPN data. Current encryption technologies are so strong that we do not have computers that can break the encryption in reasonable amount of time. If a computer were to break that encryption it would take thousands and millions of years. VPN secures your data from your computer to the VPN server. And in between there are machines belonging to the ISP, which only see the non-decipherable data stream tagged as a VPN data stream.
Imagine the Internet like a river, and the ISP like a canal connecting one river to the other. As long as the rivers are connected and the flow is good, the canal operators will not care what is passing through. But they would know what kind of water is going through. Suppose someone throws in some whales in the river and it gets stuck in the canal. The same way the ISPs reduce the flow of torrent graphics but they do not care about vpn traffic unless it is too much that other people are getting affected, that is the overall bandwidth is reduced.
The ISPs have a huge bandwidth and distribute it among its users. First of all it would be intensive on their networking machines to “look” at the data. Because that is possible using specialised software only which are load intensive on computers. Such software are network packet analysers, network protocol analysers and the like. If an ISP does “look” into the data, they would see huge amounts data flowing, with differently tagged chunks. The tagging is as per international standards and changes according to the purpose as well as the type of data.
The ISPs can certainly see that you are using VPN but they cannot see what is the data being transmitted using VPN. That’s because each Internet data packet has a well defined container that helps it to reach from one place in the Internet to the other place. Without those container specifications data won’t be able to flow on the Internet. VPN has a container specification as well. You can see a sample of the VPN data on WireShark Wiki (WireShark is a network protocol analyzer) at https://wiki.wireshark.org/OpenVPN; it has some geeky details about a particular type of free VPN called OpenVPN.
The point is, your data security is intact in front of the ISP. But your privacy is not. Your isp can log and track when and for how long you used a VPN connection. The authorities see VPN traffic as suspicious and your ISP can have stored logs of your usage of VPN. In addition to knowing that you are using VPN, the ISPs also know the destination address of your VPN traffic along with the port number. But it’s like knowing a titanium alloy safe (which can never be opened) is moving from A to B, but not being able to know what’s inside it.
There isn’t much that can be done to hide your identity while using a VPN. You can use a proxy network to jump IP addresses, but the source will be your IP. If you want anonymity, that might be possible by using IP address re-writing in each Internet data packet that you send. That means you can only send the data and not receive it, and the data being sent to you would goto someone else (who’s IP address you are faking), which defeats the purpose of using the Internet in the first place.
Under normal circumstances, VPN still protects your data from the ISP, whereas your identity cannot be hidden owing to how the Internet works. But any normal Internet user (who’s not doing anything illegal over VPN) would be happy about data security that VPN offers. So, sit back, relax and send those private pictures to your friend, because the ISP has no idea that you just sent pictures over VPN, let alone know what the picture is.