Phorm: opt-out is good enough

 

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By Barry Collins

Posted on 17 Mar 2009 at 12:54

Contentious behavioural advertising firm, Phorm, says that allowing users to opt-out of its service - rather than opt-in - will be enough to appease the Government.

Is BT losing its bottle on Phorm? Read Barry Collins' thoughts here

Speaking at the House of Commons last week, Phorm rebutted allegations that it was "snooping" on internet users by claiming that customers could always back out of the system.

"You don't have to change ISPs to avoid our system - we have a network-based opt-out," claimed Mark Burgess, the company's senior vice president of technology. "They [customers] always have a choice."

That clashes with previous advice issued by the Information Commissioner's Office, which had stated the Webwise service must be opt-in. "Phorm products will have to operate on an opt-in basis to use traffic data as part of the process of returning relevant targeted marketing to internet users," the ICO said in a statement in April 2008, which now appears to have been removed from its website.

However, Phorm spokesman Alex Laity insists that opt-out is sufficient. "Informed consent is what's required [by the Information Commissioner]," he told PC Pro last week. "Opt-out would be informed consent. Informed consent would be clarity of purpose and clarity of choice."

(Update: Alex Laity has susbequently asked us to clarify that Phorm's position is: "opt-out would be informed consent if it provided clarity of purpose and clarity of choice").

A spokesperson for the Information Commissioner's Office was unable to comment at the time of publication.

BT "considering its position"

A spokesman for BT, which Phorm says will likely be the first ISP to roll out its Webwise system, claims the company "was still considering its position" on the opt-in issue.

"The situation for us is... if we roll out, because we're not fully committed yet, we're still deciding, we're looking at reviewing the trial results still... and we'll be announcing next steps in due course.

"Suffice to say, if we do roll out we'll give customers a clear choice. At the moment, the precise mechanism hasn't been decided. We did use opt-in in the trial," he added.

Friends in high places

Despite last week's grilling in the Commons, Phorm has already won the support of Government ministers. Minister for Communications, Technology and Broadcasting, Lord Carter, recently described Phorm as "another example of an interesting and innovative business which is trying to provide a service to users and advertisers in a new market".

Kip Meek, who served as a member of Lord Carter's Ofcom board and is chair of the influential Broadband Stakeholder Group, recently joined Phorm as a non-executive director.

"In the current context, the emergence of new technologies and models such as Phorm - which, through precision advertising, brings ISPs into the online advertising industry for the first time, and allows all web publishers to actively monetise their content - can play a very constructive role," Meek wrote in the Phorm newsletter last week.