ICO examines online ad deals

The Information Commissioner (ICO) is examining a deal struck between technology company Phorm and three of the UK's top internet service providers (ISPs).

A number of readers have contacted Computeractive with concerns about privacy issues after they learned that the deal gives ISPs a cut of ad revenue in return for providing data on customers' web use.

Now the ICO has requested details of the technology and the deal from Phorm and the ISPs involved – BT, Virgin Media and Carphone Warehouse.

An ICO representative said:" It is not an investigation but at our request, Phorm has provided written information about the technology it is using. We are examining this and the way in which the company intends to meet privacy standards.

"We are also in contact with the ISPs who are working with Phorm and we are discussing this issue with them."

Computeractive has asked Phorm for an interview nobody at the time of going to press was available.

The technology takes information about a user's web surfing habits and delivers that to advertisers so that they can show users ads they think are targeted to the user's interests. Though ad-targeting systems have long been used, they have not until now used data directly from an ISP.

More traditional systems, such as Doubleclick, use small files called cookies that can be used to record a user's activity on a single website or across numerous websites that share an advertising network.

Phorm has said that the information about a user's activity is not connected to individual identities, which protects user privacy.