Can you hear that noise in the background? That’s the sound of our friends at controversial web-advertising firm, Phorm, scraping the barrel.
Having previously hailed Phorm as the solution to all our phishing nightmares, the company is now claiming it’s the answer to Britain’s rural broadband divide.
Phorm claims that a new survey showing London has broadband speeds that are twice as fast as regions such as Northern Ireland proves that “the model for funding the internet is broken.”
The answer? Allow ISPs to benefit from Phorm’s advertising revenue, of course. “Billions are needed for higher-speed networks yet currently ISPs only have income from broadband subscriptions,” Phorm’s CEO Kent Ertugrul claims.
“Today ISPs don’t tap the £2.8 billion UK internet advertising market which pays for most of the other services on the web. But brand owners would pay a premium for the highly-accurate targeted advertising systems that ISPs could offer.
We are developing those technologies - in line with people’s privacy expectations - to provide the extra income for ISPs to invest in the improved broadband services that users want.”
Sadly, this argument has more holes in it than Paula Radcliffe’s trainers. First, the £2.8 billion of potential extra revenue is only a drop in the ocean of the estimated £15 billion BT claims it would cost to fibre the entire country, which is the only viable way of truly bringing rural areas up to speed.
It’s also a mighty assumption that ISPs would plough any additional income into improving the network. Most seem quite happy to sit back and let BT pick up the tab, while those that are putting their own equipment into exchanges are doing so in the built-up areas that already benefit from nippy broadband.
There are also a few who might take issue with Phorm’s claims that its service is “in line with people’s privacy expectations”. The Foundation for Information Policy Research, for one, which has branded the scheme illegal in the UK, based on its interpretation of the Regulation of Investigatory Powers Act 2000.
Tags: broadband, BT, digital divide, Phorm
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June 3rd, 2008 at 10:00 pm
Phorm should just give up and come back in another guise like everybody else does…
June 5th, 2008 at 10:30 am
£15Billion my backside. BT’s last figures were £10billion, at the outside, and based iirc on a total fibre dig to every residence, ie the worst case solution.
The Govt should change planning requirements making fibre the 5th essential utility, which reduces cable laying costs by a factor of 10. The telcos would fall over themselves to partner with developers to install fibre in planned ducting, then use IRUs to open the loop to other providers.
Brownfield sites can be retrospectively cabled using existing ducting/access, or sharing redeveloped access. And major residential areas through shared fibre and/or shared ducting.
The costs start to come down…. Fair enough BT does not have a £10B warchest to start this, and understandably would not to begin the task knowing that others would have immediate entitlement, but there are ways forward other than simply stating it would cost billions to dig up all the roads. Oh, and as for rural areas… given the lower population density, there is a lower backhaul requirement. So much that a single fibre pair has more than sufficient capacity for entire villages.
June 5th, 2008 at 2:55 pm
Phorm are really getting desperate, they must have blown their PR budget on fighting all the commenters on the blogs and news stories in March and April.
June 5th, 2008 at 3:48 pm
There is a gaping flaw in Phorm’s argument that advertising revenues would help bridge the rural divide. The reason for the divide is simple mathematics - make as much money, i.e. catch as many people as possible, with minimum investment. Cabling towns and cities being much cheaper per user than sparsly populated rural areas yet subscription fees per user are identical for city and village dweller alike.
Add Phorm revenue into the euquation you’ll likely find that the Phorm revenue per user is approximately the same for city and village dweller, so you STILL have the situation where it costs more per user to install/upgrade equipment in villages and rural areas but the yield in subscription and ad revenue per user will be the same for both.
June 6th, 2008 at 10:58 am
It is time Phorm realised the past lies onthe trials in 2006/2007 will have tarnished BT’s image lost BT trust with many customers. Knowledgeable internet users know all about phorm the reincarnation of 121media and all other names.
The fact Phorm use Russian scriptors that are in the same area as Russian hackers, Phorm still use planet to host servers until recently thye had webwise.bt.com there. Planet is in the top ten world phishing hosting companies.
Phorm was apyware in 2005 and is still spyware now contact with the past is as strong as it is now trust isn’t a word used when talking about Phorm BT’s trust level is dropping rapidly daily.
June 6th, 2008 at 11:08 am
phorm should go back the other side of the alantic and punt its spyware kit over there (oh sorry senators are question the lagality over there as well)
if the ISP’s are having issues with costs stop giving away free laptops (aol) stop selling broadband access at rediculous low prices when bundled with other services,
the answer is simple provide two levels of service , 1 el cheapo subsidised by advertising (but legit banner ads not via spyware kit) and the other full price full service
but no, the telcos are worried they would not have as many customers, they have not realised customers are savvy, look at the number leaving pipex since tiscali took over with their offshored helpdesks
i moved from them to BT (worst thing ever for me) now looking to move to ZEN more expensive but uk call centre, good customer service and good speeds