[LINK] nick off Phorm
stephen at melbpc.org.au
stephen at melbpc.org.au
Tue Jul 7 18:35:26 AEST 2009
With luck, Phorm will go broke. They developed deep packet inspection.
Phorm stranded as BT and Carphone pull plug on online spying technology
by Elizabeth Judge 'The Times' July 7, 2009
The future of Phorm, the developer of controversial internet "spying"
technology (deep packet inspection) looked increasingly uncertain last
night after Carphone Warehouse joined the list of big-name clients
shunning the service.
Shares in Phorm slid 40 per cent yesterday after BT pulled plans to use
the service, which tracks internet users and sends specially tailored
advertisements to their screens based on their personal tastes. The
decision followed a barrage of attacks from privacy groups.
After BTs move, Charles Dunstone, head of Carphone Warehouse, said: "We
were only going to do it if BT did it and if the whole industry was doing
it. We were not interested enough to do it on our own."
Virgin is also reluctant, meaning that Phorm, whose non-executives
include Lord Lamont, the former Chancellor, has lost Britains three
biggest internet groups, prompting analysts to question its future.
(The Times Related Links: Wikipedia latest to reject Phorm technology)
Dan Cryan, head of broadband at Screen Digest, the research and
intelligence consultancy, said: "It is never a happy position to be in
when a company potentially loses most of its customers before it has even
had a full commercial launch."
Phorm, which listed on the Alternative Investment Market in 2004, is one
of a growing number of companies seeking to cash in on the trail of
personal information that we leave behind on the internet.
Its service is aimed at showing advertisements based on who is looking at
a particular web page, rather than the content of the page itself. A car
lover, therefore, could be presented with car adverts even if searching
For internet service providers, it offered a potentially valuable new way
of generating money from their subscribers. "Tailored" ads potentially
reap 100 times more than traditional ads, according to some analysts.
BT, Virgin Media and Carphone Warehouses TalkTalk had all signed up as
partners in the service. Last year, however, Phorm came under fire when
it emerged that BT had been conducting secret trials of its technology on
36,000 of its broadband customers.
Privacy groups said that the system was intrusive and even Sir Tim
Berners-Lee, creator of the World Wide Web, condemned it: "I feel it is
very important that my internet service provider supplies internet to my
house like the water company supplies water to my house connectivity
with no strings attached," he said.
Phorm insists that users are stored as a "unique random number" rather
than a name, that it does not gather personally identifiable information
and it does not store IP addresses. It said yesterday that its British
ambitions remained intact.
The company is hoping that BT will rethink its decision. However, a
recently published report from its broker had already identified the next
six months as critical for the company and its investors, who ploughed
£32 million into the group last year.
Phorm, which last year made a $48 million pre-tax loss after running
trials in the UK and South Korea, said that it was focusing on
opportunities abroad. "In so doing, we have already minimised our
dependency on the deployment by any single ISP or in any particular
market," it said.
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