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Advertising aimed at you

May 2008

Do you use BT, Virgin or TalkTalk as your Internet Service Provider (ISP)? If so, you should know about their plans to make money by using the information they collect about you.

It’s all because they are the first to have been signed up by an internet advertising company called Phorm, the latest in a longish line of companies trying to deliver the Holy Grail of internet advertising: making sure that any adverts that appear on sites you look at are for products you might actually buy.

In theory, this is perfectly possible, as when you look at a website it can see your IP address. IP stands for Internet Protocol, and each electronic gadget that uses the internet has one (like a car registration number). So it can tell if you’ve been there before.

In addition, your ISP records all the sites you look at and will merrily hand the details over to a number of government agencies at the drop of a legal hat, and without you knowing about it.  Click here to read all about the law that gives them this power, if you doubt me.

This shouldn’t be a surprise – I’ve been banging on for ages about there being no privacy on the internet and that browsing websites is essentially a public activity, no more private than postcards.

However, this company Phorm is taking things a step further, and is now offering to pay ISP’s for the information, with a view to targeting advertising more precisely.

It’s all a bit technical, but in essence it works like this: my ISP feeds all my internet activities to Phorm, who record it carefully. If I later visit a website that is a client of Phorm, the information it has gathered about all the other websites I have looked at will be used to decide which adverts to display. Regular viewers of The Oldie website, for example, might be shown adverts for fine wine (we’re a classy lot) when they visit a Phorn client’s site.

In return for this the ISP will be paid a commission on any sales generated for Phorm’s clients.

Phorm claim that their systems will not allow them to identify me directly, as they will not record my IP address, which will be hidden behind an “anonymised” number, whatever that is. To reassure us, Phorm asked the accountants Ernst & Young to look at the system, and they were fairly happy with it.

Well, I’m not. Accountants are the last people I would ask to look into such a thing; I’d want the geekiest techie hacker I could find to comb through it all. Set a thief to catch a thief, I say. However, to be fair to Ernst & Young, even they said that “because of inherent limitations in controls, error or fraud may occur and not be detected” (click here to see a copy of their report, if you can stand it).

Two main thoughts occur to me over all this. The Phorm system may enable modest sites to generate some income that is otherwise denied them, and make it possible for them to remain open to us all without charge. That’s probably a good thing. Also, I suppose I’m not too concerned about my ISP examining my web activity – I’ve no choice, anyway.

On the other hand, I don’t buy this “anonymising” claim. At the moment, my ISP has a legal obligation to keep the information it gathers secret and not muck about with it. No such obligation falls on Phorm, and even if Phorm themselves can’t identify who I am, I would not put it past some other swine who buys this “anonymous” data from Phorm to find a way of extracting my address from it. After all, if there is no route back to me from this data, however encrypted, the data has no value.

None of this seems to worry BT, Virgin or TalkTalk, or those who will follow them; they presumably just see it as a way to squeeze more cash out of the system. No change there, then.