Phorm might be onto something

Since behavioural targeting company Phorm launched recently I’ve looked at the ins-and-outs of the system and it does look pretty interesting. Phorm is basically an add-on service for an ISP which looks at all your web surfing and attaches an anonymous cookie to your machine. ISPs trying to target advertising based on this packet data appeared way back in the first dotcom boom, but no-on could make it work. Phorm uses a technology called ‘deep packet inspection boxes’ to track EVERY website you visit. Normal cookies are tied to just the one web site they came from, or the ad-network, like DoubleClick’s. Phorm’s cookie looks at all of them – with some exceptions, like banks – and collects information on browser type, response to advertising, the URLs of some of the web pages viewed and search terms entered. Where the Phorm cookie sees a page with a Phorm advert tag on it, it serves an ad. So it wouldn’t, say, put an advert on the BBC web site because the BBC wouldn’t have put the Phorm tag into the page.

But despite this sounding like a privacy nightmare, the Phorm cookie is given a randomly generated ID number attached to a nameless profile of the categories sites a user appears to be interested in. This profile is then matched against advertisers to target ads against that user who’s actual identity (email addresses, surnames, street addresses etc) is not known. What information they do have – which is just the surfing habits of that PC – gets deleted after a few hours. Phorm’s privacy claims have been approved by Ernst & Young and Privacy International. The cookie doesn’t track you on sites like SSL or forms you fill in. Of course, data is secure as the companies that keep it – and it’s possible to de-anonomyse data. Phorm says it wouldn’t mix surfing data with, say, an ISP’s billing data on users.

Phorm’s system also alerts users to a list of blacklisted sites, in a scheme called Webwise. This is the carrot to keep people from switching off the Phorm cookie, which they are given access to and told it is watching them.

Phorm has so far launched in the UK with BT, TalkTalk, and Virgin Media.The Phorm cookie also recognises publishers signed up to Phorms ad system, so the partners for that are the; iVillage; Universal McCann; MGM OMD and Unanimis.