Phorm ad system ‘illegal’, claims think tank

Phorm is already being used by UK ISPs Virgin and TalkTalk and is due to be trialled by BT this month.

The system is designed to make online ads more relevant by taking account of all the websites a person visits during a complete 'browsing session', rather than just the content of a single web page.

For example, if a user visited five golfing websites before visiting a financial services page, the technology might suggest serving another golf advert on the financial page, where typically an advert for a financial product might have appeared.

The Foundation for Information Policy Research (FIPR), a group of Cambridge academics, said this week that the service infringed users' privacy.

The group called on the Information Commissioner, who is due to publish a report on the subject in a couple of weeks, to condemn the service.

The FIPR said that gathering information about website visits without the user's consent amounted to a breach of the Regulation of Investigatory Powers Act, which prevents unlawful interceptions of communications.

In a statement, the FIPR said:"Users should have to opt in to such a system, not merely be given an opportunity to opt out. Failure to establish a clear and transparent 'opt-in' system is likely to render the entire process illegal and open to challenge in UK and European courts."

The FIPR's report went further, suggesting that even if users agreed that their browsing could be monitored, the service would still be illegal unless it also obtained the consent of web publishers, as the content on their pages was effectively part of the 'intercepted communication'.

A spokesman for Phorm, which is based in the UK, said that it had not taken a decision about whether users would have to give their consent before the service was activated, which would be a matter for the ISPs which signed on.

Meanwhile, more than 5,000 people have signed a petition which claims that Phorm invades privacy and calls on the Prime Minister to review the country's privacy laws.

Phorm's technology assigns the computer of each internet user a number, so that the path of the user across the internet can be tracked.  

Individual websites may hold registration details about their own users, but they are unlikely to know which other websites and services they use. Such information is typically known only by the ISP.

Once the advertiser's criteria are satisfied, the advert is served and the details of that person's path across the internet are deleted, Phorm said.