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Privacy Fears Follow Major ISP Advertising Deal

Posted: 26th Feb, 2008 By: MarkJ
Last week it was announced that several of the UKs leading ISPs, including BT, Virgin Media and TalkTalk, had signed a major new deal with Phorm, an advertising technology company.

However Phorms deal has raised concerns after it emerged that ISPs would be asked to hand over details of their customers’ personal surfing habits in order to help develop targeted advertising campaigns. The official press release reads as follows:

OIX [Open Internet Exchange] will create a new marketplace for online advertising, that is based on internet users' anonymous browsing activity and ensure consumers receive fewer irrelevant ads. It will also revolutionise current standards of online privacy and fully protect the identity of consumers. Phorm's privacy claims have been validated under best industry practices, both through an independent audit conducted by Ernst & Young (View report PDF) and a Privacy Impact Assessment undertaken by experts from Privacy International.

OIX is the first real-time online advertising platform to use fully anonymised ISP data streams. It operates by allowing market participants to define customer advertising "channels" - groupings of users demonstrating interest in specific product and service categories - then uses this information to serve relevant ads based on a user's browsing activity. This benefits advertisers, publishers and consumers alike and introduces a completely new level of effectiveness in online advertising.

It's not clear precisely what data is to be shared, although information about the websites ISP customers visit is likely to be part of it. Unfortunately such practices are not uncommon in new media industries but The Register has uncovered additional cause for concern. It turns out that Phorm's boss, Kent Ertegrul, used to be a founder of PeopleOnPage, which was blacklisted as Spyware by Symantec and F-Secure (details):

F-Secure Spyware Summary: "PeopleOnPage collects browsing habits and system information and sends it back to the ContextPlus servers. Targeted pop-up advertisements are displayed while browsing the web. PeopleOnPage, or POP!, is marketed as match making software."

There certainly appear to be some disturbing similarities between Phorms system and that of PeopleOnPage, although Phorm are adamant that the new method fixes past problems and is much more secure. There’s a good summary of the problems here.
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