BT has decided not to proceed with the roll-out of the advertising system Phorm which monitors user activity online to generate behavioural based advertising which is then displayed via participating websites. The controversial system has been slated in the press for both secret trials back in 2007 and a general belief from privacy campaigners that the system could be illegal due to the way it intercepts users traffic, and how users can opt-out of the system.
"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.
"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."BT Statement on Phorm
The secret trials conducted by BT and Phorm in 2007 which directed information on users browsing habits to Phorm sparked off a wider interest in the system that has been plagued by moral and legal concerns. The City of London Police ran an investigation into the legalities of its covert test of Phorm but dropped the investigation citing implied consent. Later trials of BT, which termed the system Webwise were conducted more openly, but concerns continued to exist on how individual users could opt out, particularly on shared computers.
The UK government were asked to step in to detail whether the system and implementation would satisfy their privacy laws, and the outcome that it would have to be an opt-in system was determined. The European Commission wasn't so happy though and opened a case on the 14th of April against the UK over its handling of Phorm and how it has implemented EU privacy laws. Many large websites including Amazon and Wikipedia then announced that they had requested to be excluded from any scanning by BT's Phorm system.
BT was the test case that other ISPs such as Virgin Media and TalkTalk were watching with bated breath to see how the legal and moral concerns played out. TalkTalk held fast stating from the start that any implementation they perform would be opt-in, and not an automatic inclusion as BT originally planned for their system.
Phorm remain positive about their position, and have expanded further afield with talks to potential partners in 15 other countries, including South Korea's largest ISP KT.