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ISP delays costing Phorm £1m a month

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Posted 19th June 2009 at 5:21pm by Oliver Folkard

Customer service and Satisfaction

Behavioural advertising group Phorm is losing more than £1 million a month because internet service providers (ISPs) are delaying its service.

The targeted advertising specialist has revealed that it lost £30 million in 2008 and will not be able to earn revenue until ISPs decide to deploy its Webwise programme.

Phorm has courted controversy since it hit the headlines last year, with some claiming that its advertising technology contravenes EU rules on consumer privacy.

Webwise is used directly by ISPs to monitor the browsing habits of their broadband customers, although the company claims its technology is safe and secure.

In a statement, Phorm Chief Executive Kent Ertugrul highlighted the factors that will affect the organisation's cashflow in the year ahead.

Among them were "the timing of commercial deployment of the group's services; take-up rates by consumers, publishers and advertisers and the net revenue per advert that will flow to the group."

In the UK, BT, Virgin Media and TalkTalk have signed up to Webwise and intend to allow Phorm to monitor the browsing habits of their broadband customers.

More news on: Customer service and satisfaction, Advertising & brands

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3 comments

  • Ian, 20th June 2009.

    It is hardly surprising that BT is delaying rolling out this 'service' as you so eloquently call it.

    Perhaps BT, and others, are waiting for the outcome of the EU infringement proceedings against the UK government for failing to correctly apply EU privacy regulations and confidentiality of communications regulations. If that is so, it could be many months before concusion.

    The EU Commission themselves stated that Phorm "intercepted" user data without clear consent and the UK need to look again at its online privacy laws.

    Another point to consider are the copyright issues. The millions of websites across the internet that are opted-in by default. Phorm suggest that if they are not happy then they can opt-out.

    Phorm and BT believe a website owner gives implied consent for the copying of the intellectual property for commercial gain.
    The Commission stated recently that EU Law does not recognise implied consent and that consent must be explicit and informed and that all such services must be Opt-In.

    This isn't simply a quetion of whether Webwise is safe and secure, It is not even about the serving of adverts. It is about privacy of communications traffic between a website and its users. It is about confidentiality of communications, personal communication surveillance, industrial espionage, and mass copyright infringement.

    It is hardly surprising that Amazon felt the need to refuse Phorm to scan its websites.

    Reply

  • Mike, 20th June 2009.

    I don't want my Internet provider to monitor my browsing habits and will leave my provider if they implement Phorm or any other spyware-in-the-network system.

    Reply

  • James, 30th June 2009.

    The moment BT deploys Phorm I will find another ISP that actually listens to what I want.

    Reply

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