Its been a few months since we talked about Phorm. The online advertising firm has raised controversy due to its technology which allows advertisers to target users based on their online behaviour.

Unsurprisingly, Phorm has met considerable resistance from online privacy campaigners, including the ‘father of the Internet’ Tim Berners-Lee. Big name websites such as Amazon and Wikipedia have also pledged to block Phorm from gather user data from them.

Whilst Phorm has to a certain extent faced down legal threats to its operation, the biggest challenge has been to convince an ISP partner to get involved. For the system to work, Phorm needs to install its equipment into the ISP data centre. No ISP, no Phorm.

Although Phorm convinced BT to run an early trial, it has since lost support from previously willing ISP partners. BT pulled the Phorm contract earlier this year, and TalkTalk has cut ties with the company. Virgin “continues to evaluate” the system.

For this reason, Phorm says that the UK was now just a “medium to long-term prospect”, adding that it will “deploy in other markets first”. The country which has been most open to this form of behavioural targeting is Korea, where Phorm is partnering with the largest ISP ‘KT’.

Nevertheless, Phorm has said that they will keep their UK operation running despite the challenges it faces here.

“Phorm remains fully committed to its operations in the UK. We continue to be active in the market and are confident of the opportunities domestically. Meanwhile, Phorm is also making substantial operational progress internationally”, it said in a statement.

Back in September Phorm released an update to its trading figures, which show that its had incurred a pre-tax loss of $15m for the first half of this year. This is a big drop in the same period last year, when it lost $24.7m.

What do you think of behavioural targeting? Are you willing to give up some privacy in order to get tailored advertising messages? Have we heard the last of Phorm? Leave us a comment below.

Controversial online behavioural targeting company Phorm is finally planning its UK launch. Phorm has been the subject of lots of discussion due to their much feared technology that allows them to  track users online behaviour. Phorm analyses user behaviour and then serves adverts specifically tailored to them.

Some online privacy groups have tried to block the roll out of Phorm, which they see as impinging on their online privacy. Some websites – most notably Amazon and Wikipedia – have publicly stated that they will block Phorm from collecting user data.

Despite this, Phorm’s ‘Webwise Discover’ will launch in the UK before the end of the year following a successful trial in Korea in May.

In order to go live, however, Phorm faces the not insignificant job of convincing the major ISPs (Carphone Warehouse, Virgin and BT) to partner with them, since they need the assistance of the internet provider in order to make the technology work.

From a users’ viewpoint, Phorm’s Webwise Discover will simply be a small box overlaid on the corner of their screen, which will contain personally tailored adverts, videos, images or even news stories.

There are a couple of examples of the kind of tailored content the system will be able to produce. Let’s say that based on user behaviour Phorm can work out that you’re interested in the footballer ‘Wayne Rooney’. The next time you surf the internet, Phorm will automatically locate new content and articles about Rooney.

Or taking the example of shopping, you could be on a website looking for a particular product. The system can automatically locate reviews or live auctions for that item.

To lay privacy concerns to rest, Phorm are saying that users will have the option to switch the service off and on at any time. Phorm has also said that the system is completely anonymous, and keeps no record of browsing history or any personal information.

For our part, we believe that the issue of online privacy has been confused by the media. Behavioural targeting such as Phorm means getting a personalised, more relevant version of the Internet. It doesn’t mean that your personal details, or for example your bank account information, is in any way compromised.

And ‘Webwise Discover’ might sound a bit scary at the moment, but once people have the chance to try it out we think many fears will be laid to rest, as people like the degree of personalisation it can offer.

What do you think? As a website builder, would you use Phorm to promote your site to new users? Is Phorm a small step forward for the Web, or something to be avoided at all costs? Leave us comment below.

Phorm, the online advertising firm, is finally making noises about going live with their controversial advertising platform. Phorm allows advertisers to target users based on their online behaviour.

We’ve discussed behavioural targeting – and whether this is a breach of user privacy – before, and we (I say we but mean me don’t I!) hold the view that it’s worth giving up a little bit of privacy in order to get a tailored online experience. I believe that people distrust behavioural targeting due to two misunderstandings. First, that they think that it is the online equivalent of getting direct mail through the post. And second, they believe that online privacy breaches means the lost of personal data such as bank account details.

Phorm are trying to dispel public fears in a public meeting next week. Anti phorm campaigners claim that the service breaches UK data interception laws. And according to the BBC, the European Commission have even started legal action against Britain over the platform. Despite this, the company actually received official clearance from the Home Office, and the police – who investigated BT’s trial of the technology – have now closed the case.

Phorm CEO Kent Ertugrul told BBC News: “We have been supported or endorsed by all of the leading stakeholders… Ofcom, the Information Commissioner’s Office, the Home Office, leading privacy advocates like Simon Davies, the advertising industry and publishers have all backed our service,” he said.

The official line on Phorm technology is that it ‘trawls’ websites visited by users whose ISPs are using the service, and matches keywords on those websites to the users’ profiles. The user is then targeted with ads that are tailored to their profile.

The initial trials were with BT, but Talk Talk and Virgin have also confirmed their interest. Following all the negative publicity, ISPs have to weigh up any revenue per user the system might generate with the loss of those customers whose fears cause them to migrate away.

The government for its part has given the system a green light but only if users have given consent and have the ability to opt out.

Privacy groups The Open Rights Group and the Foundation for Information Policy Research are still firmly opposed to use of the technology.

Our view - that it is a lack of understanding of behavioural targeting, and the belief that somehow users will suffer a breach of their personal data is what is creating the resistance to the service - is shared by the CEO Kent Ertugrul. He said:  “I am surprised by the fact, after it has been repeatedly explained how the technology works, they seem to be very keen on misunderstanding what it does.”

What do you think? Would you allow yourself to be behaviourally targeted if it meant you saw relevant ads? Or are you an website builder and advertiser who would like to make use of the technology?  Leave us a comment below.

16.04.09 Update: According to Web User, privacy campaigners have cheered the news that Amazon are planning to deploy technology that prevents Phorm from gathering information about users whilst they are visiting  the Amazon website. Jim Killock of the Open Rights Group (ORG) said: “By choosing to block the contentious online advertising system from scanning its web pages, [Amazon has] taken the positive choice to protect their users’ privacy and their own brands”.

Phorm for its part responded with a statement which read: “there is a process in place to allow publishers to contact Phorm and opt out of the system, but we do not comment on individual cases”.

Round 1 (or is it Round 99?) to the privacy lobby?

22.04.09 Update: According to ComputerShopper magazine, Wikipedia has now decided to opt out of Phorm. An email sent from Wikimedia (the organisation that runs Wikipedia) to Phorm stated “we consider the scanning and profiling of our visitors’ behaviour by a third party to be an infringement on their privacy.”

Round 2 all done then!

28.04.09 Update: Phorm has launched a website to take on critics. Kent Ertugrul says this is because it has been relentlessly under fire from “a small, but dedicated band of ‘privacy pirates’ who appear determined to harm our company”.  Phorm are complaining that privacy activists are targeting MPs, journalists and regulators to try and “distort the truth and misrepresent Phorm’s technology”.

2-1?

Following our previous story about behavioural targeting, Google announced this week that it is to launch ‘interest-based’ advertising.

They know that advertisers are keen to invest in advertising that reaches people based on their online surfing habits, and have moved to allow them to target specific ‘interest’ groups on both YouTube and the Google content network

At the moment the new advertising model is in Beta, which gives a few advertisers the opportunity trial and give feedback to the product specialists at Google. Of course knowing that amongst consumers this targeting model may be akin to online snooping on their bahaviour, Google have tried to reassure users that they will not use information stored within Google Accounts.

And in a major step forward, Google are giving us all the ability to access and edit the interest category that they have compiled for us, or to opt out entirely.

What this means is that you as a user can log into the ad preferences section in your Google account. You might have recently watched some soccer clips on YouTube, and Google might have therefore placed you in the interest category ‘football’ .You have the ability to confirm or reject Google’s categorisation of your online behaviour. If you accept it you will be more likely to receive advertising from companies selling football related products.

Google will use cookies to track users on both YouTube and the Google content network (any website where you see the ‘ads by google’ message at the bottom of an advert). Of course their assessment of what we’re all interested in won’t be perfect, but rather a best guess based on the websites we visit, the video clips we watch, and the articles we read. A statement from Google said: “Over time we expect our ability to get the right ad in front of the right person at the right time to improve as we build interest categories with the help of our users and publishers.”

This comes at a time where Tim Berners-Lee – the person widely credited with the foundation of the Internet in 1989 - has said that the maintenance of online privacy is vital for the development of the web. He is calling for restrictions on the collection and use of ‘private’ information. He considers the Google’s ‘interest based’ advertising model, and behavioural targeting in general, is just the sort of private information gathering we need to avoid.

The other side of the equation is this: we all expect information on websites to be free of charge. We read our newspapers’ website, get free newsletters, catch up socially, all without any cost to ourselves. But all the services do cost at some point, so if we aren’t prepared to pay a subscription then we need to make it possible for the providers of these free services to raise money in other ways – by selling advertising. And the better targeting they can give to advertisers, the more money they can make from advertising. And the more money they make, the better their service becomes. And so on.

Once again we’re back to the same old question. Is it worth giving up some ‘private’ information in order to get a better version of the Internet, and allow online publishers to make a return too? I firmly think so, and as a website creator you’re probably on my side, but the reality is that everyone needs to be educated to be able to make an informed choice. Whilst ignorance of online behavioural targeting exists, consumers’ decisions will be driven by fear rather that what is actually best for the long term development of the web.

Got an opinion? Leave us a comment below

We’ve blogged previously about online privacy – it’s a really hot Internet topic. Whilst we all want to protect our online identity, I personally think that it’s worth giving up some privacy in order to get a more tailored Internet experience. This of course includes getting served adverts that are specifically targeted at me. When it comes to advertising, getting personalized & tailored adverts aimed just at me is called ‘behavioural targeting’.

Behavioural targeting currently has a poor reputation. A poll out this week in New Media Age magazine suggested that over 81% of Internet users would reject receiving behaviourally targeted advertising. This bad name is probably down to scant information amongst users, who probably believe ‘behavioural targeting’ is the online equivalent of getting bombarded by leaflets through the post. The majority of us resent having direct mail land on our doormats, but the reality is that behaviourally targeted advertising is something completely different. As I’ve said previously it’s got to be worth getting a more personal version of websites and of online advertising, if it means that it’s more relevant to you. But the chances are that people are choosing to opt out of this because they have the perception that it’s going to be like getting direct mail, whereas in reality it’s going to be a more tailored online experience.

This week there’s been a major step forward in the setting up of a regulatory framework for behavioural targeting. In an attempt to lay consumers’ fears to rest, lots of Internet Advertising organisations including Google and the Interactive Advertising Bureau (IAB) have got together to produce guidelines about what is acceptable in terms of targeting users based on their online behaviour. This includes a range of measures including making it clear when information is being gathered by a website, and giving the user the ability to opt out of that information gathering.

Experts say that these guidelines need to quickly win the trust of Internet users otherwise the idea of behavioural targeting will be dismissed before it has even been given a chance to work properly.

Which side of the fence do you sit? Would you prefer to keep your online behaviour completely private? Or as someone who likes to build websites, can you see the benefits of reaching out to users whose online activity means they might want to buy one of your products? Leave us a comment below.