Feeds

BT abandons Phorm

Not looking good for ad tech

Top three mobile application threats

BT has abandoned plans to roll out Phorm's controversial web monitoring and profiling system across its broadband network, claiming it needs to concentrate resources on network upgrades.

Privacy activists have greeted the news as a victory for their campaign against the firm, which was sparked by revelations in The Register that BT had secretly trialled Phorm's advertising targeting system on tens of thousands of customers.

Alex Hanff, a prominent member of the campaign, who was recently publicly attacked by Phorm on its rebuttal website, said: "I am obviously ecstatic. My heartfelt thanks go to everyone who has been involved."

BT's announcement comes a day before MPs and peers of the All Party Parliamentary Communications Group are due to begin an investigation of internet privacy. Their intervention follows the EU's move to sue the UK government over its alleged failure to properly implement European privacy laws with respect to the trials, drawing further bad publicity to the venture.

The decision deals a massive blow to Phorm. At the time of writing, its shares were trading down more than 25 per cent at £3.53.

BT Retail is the largest ISP in the UK with about 4.8 million subscribers. It was a close partner in the development of Phorm's technology. Stratis Scleparis - chief technology officer at BT Retail at the time of the secret trials - was convinced enough of the money-making potential of the system to take a job and share options with the smaller firm.

BT's public statement today adopted Google's preferred "interest based advertising" terminology. It made no mention of the fierce reaction to its relationship with Phorm.

"We continue to believe the interest based advertising category offers major benefits for consumers and publishers alike. However, given our public commitment to developing next generation broadband and television services in the UK, we have decided to weigh up the balance of resources devoted to other opportunities," it said.

"Given these resource commitments, we don't have immediate plans to deploy Webwise today. However, the interest based advertising market is extremely dynamic and we intend to monitor Phorm's progress with other ISPs and with Webwise Discover before finalising our plans."

Webwise Discover is a sideline in content targeting announced last month.

In a statement to investors, Phorm sought to soothe worries BT's decision may jeopardise its business. It was also forced to sell a large chunk of equity at a much reduced price last month, in order to maintain operations.

"We continue to focus considerable effort on faster moving overseas opportunities. In so doing we have already minimised our dependency on the deployment by any single ISP or in any particular market," it said, adding that it was "engaged" with ISPs in 15 worldwide markets.

Virgin Media, which has not carried out any network trials of Phorm's technology, issued a statement reacting to BT's decision. It signed a memorandum of understanding with Phorm, similar to BT's, as did TalkTalk. These were not commitments to deploy the system however.

It said: "We continue to believe interest-based advertising has potentially important benefits for consumers, internet service providers and website owners. However, given the fast moving nature of the sector, Virgin Media intends to extend its review of potential opportunities with suppliers, including Phorm, prior to making any commitment to launch any of these technologies.

"We recognise some consumers have significant concerns about the potential implications of interest-based advertising for their privacy. Virgin Media is committed to ensuring that any future deployment complies not only with the relevant legal requirements but - as an absolute minimum - the best practice guidelines contained in the Internet Advertising Bureau's recently published code of practice."

The cable firm said it would be open with customers about its plans as they develop.

Phorm's June fundraising round brought in £15m. It has predicted it will spend £1.1m per month this year for zero revenue, although its last financial report revealed it had made cuts to stem even greater losses last year. ®

Top three mobile application threats

More from The Register

next story
A black box for your SUITCASE: Now your lost luggage can phone home – quite literally
Breakfast in London, lunch in NYC, and your clothes in Peru
Broadband Secretary of SHEEP sensationally quits Cabinet
Maria Miller finally resigns over expenses row
AT&T threatens to pull out of FCC wireless auctions over purchase limits
Company wants ability to buy more spectrum space in auction
EE dismisses DATA-BURNING glitch with Orange Mail app
Bug quietly slurps PAYG credit - yet EE denies it exists
Like Google, Comcast might roll its own mobile voice network
Says anything's possible if regulators approve merger with Time Warner
Turnbull leaves Australia's broadband blackspots in the dark
New Statement of Expectations to NBN Co offers get-out clauses for blackspot builds
Facebook claims 100 MEEELLION active users in India
Who needs China when you've got the next billion in your sights?
Facebook splats in-app chat, whacks brats into crack yakety-yak app
Jibber-jabbering addicts turfed out just as Zuck warned
prev story

Whitepapers

Designing a defence for mobile apps
In this whitepaper learn the various considerations for defending mobile applications; from the mobile application architecture itself to the myriad testing technologies needed to properly assess mobile applications risk.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.