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Phorm: Opt-in or opt-out?

• Rory Cellan-Jones
• 17 Dec 08, 08:40 GMT

In all the excitement about Microsoft's problems with a "zero day vulnerability" in Internet Explorer, a significant development in a major row over internet privacy passed almost unnoticed. Earlier this week, Phorm, the company whose web tracking software has so angered privacy campaigners, issued this statement to the Stock Exchange.

"Phorm, the advertising technology company, is pleased to announce that the trial with ISP partner BT has now concluded. The trial achieved its primary objective of testing all the elements necessary for a larger deployment, including the serving of small volumes of targeted advertising. There will now be a period of joint analysis of the results. Following the successful completion of analysis, both of the trial results and of any changes required for expansion, BT has informed the Company that it expects to move towards deployment."

It was back in the summer that BT was forced to apologise after its secret trial of the web-tracking software in 2007 was uncovered. But it then went public with its intention to mount a full test of Phorm. Crucially, this involved users opting in to having their web habits tracked so that they could be served adverts that mirrored their interests. Now that trial is over - and though BT is saying nothing beyond the statement issued by Phorm - it looks certain to push ahead with the deployment of the technology.

What isn't clear is whether it will be "opt-in" or "opt-out". If it is an opt-out service, then there will be an almighty row, and BT will be accused of installing a spy on its customers' broadband lines without consulting them. If it is opt-in, how many will choose to have it? I don't detect any great enthusiasm for targeted advertising. Perhaps a financial incentive will be needed - cut-price subscriptions for 'Phorm Broadband"?

The two other ISPs which are looking at the service, Virgin Media and TalkTalk, will presumably wait a while and let BT take the brickbats. But, in a fiercely competitive broadband market, they will find it hard to resist signing up if BT's gamble on Phorm turns out to be a nice little earner.

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