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Phorm Waves Goodbye to UK Broadband ISP Privacy Issues and Runs to Brazil

Posted: 30th Jun, 2010 By: MarkJ
phorm uk logoPersonalisation technology company Phorm , which controversially worked with UK broadband ISPs to monitor what websites you visit for use in targeted advertising campaigns , appears to be giving up on the UK market by moving "some operational activities" to Brazil instead.

Back in 2008 BT angered many when it emerged that they had run two hidden trials of Phorm's technology on customers, without their consent, during 2006 and 2007. Some felt that the "service" was little more than Spyware and so began a lengthy campaign, which ultimately resulted in several major UK ISP supporters ( BT , Virgin Media and TalkTalk ) effectively dropping their support.

Phorm has subsequently tried to crack Korea where it has again experienced delays that are reminiscent of its traumatic 2008/09 season in the UK. Likewise Phorm has continued to bleed money, although it's operating losses have now fallen to $29.7 million from $49.8 million in 2008. However that's mostly due to various staff cuts and downsizing.

Phorm CEO, Kent Ertugrul, said:

"The time to commercial deployment has been longer than we had hoped, and based on our current projections, we anticipate that further funding will be necessary in the next twelve months, the extent of which will depend on a number of factors, including the speed of deployment in Brazil, consumer, publisher and advertiser take-up and the rates achieved on ads served.

In summary, we believe Phorm is very well positioned for the next critical phase: demonstrating how all of the components of our model come together to create a strong, highly scalable, business. Whilst in the near-term, we expect that we will need to raise funds to take us into this next critical phase, based on current conversations, we are very confident that we will secure the funding necessary to do so."

Today Phorm is continuing its seemingly endless attempts to raise new funds, despite the constant problem of not being able to make much money from its endeavours. However it has managed to sell the Navegador (re-branded version of Webwise Discover) service to telecoms group Oi in Brazil where it earned revenues of $1.6 million.

However the firm is still plugging some of its old tried and tested spin by claiming that it is, "moving closer to realising our goal of commercial deployment in a number of markets. At this point, we are at the final approval stage with a number of ISPs worldwide." Phorm hopes that some of these might actually make it some money.

Phorm has decided that it is now appropriate to move some operational activities out of the UK to Brazil, bringing them closer to an actual customer and to access the lower cost base in Brazil. We're sure everybody will wish them well, albeit spoken with just a hint of sarcasm.
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