Advertising tracking firm Phorm has a lot riding on the trials that begin today with British Telecom. The company is beginning anticipated trials just after posting losses of $24.7 million (£13.7 million) in the first half of the year.
Phorm's losses grew from $16.3 million (£9.04 million) in the first half of last year in the lead up to the trials, which have been delayed several months by legal battles surrounding Phorm's business practices.
The technology tracks user behavior to serve targeted advertising, but in 2006 BT ran into trouble conducting trials of Phorm’s technology without asking for consent from users. The company's practices, dubbed "deep packet inspection" have come under fire from privacy advocates. Unlike many targeting companies, Phorm works with ISPs, who have automatic access to an amount of user data that makes many web surfers uncomfortable.
The company earned £32 million of new equity in March, but still only has £24.9 million in the bank. Phorm has spent a good portion of the cash infusion on technology infrastructure and integration of the technology with ISP networks.
Depending on the outcome of the four week trial with BT, branded “BT Webwise,” Phorm hopes to begin trials with two of the U.K.'s other large ISPs — TalkTalk and Virgin.
Phorm won recent battles this month when the London Police declined an investigation into their practices and a U.K. regulator ruled that the company was capable of running its business in a legal fashion. But with technological problems and user objections on the rise, Phorm has a lot of work to do to recoop its losses.
See Also:**
- * London Police* Turn Down Phorm Investigation**
- * Phorm* Targeting Deemed Legal by U.K. Regulators
- British Firm Phorm Trudges Through the Deep Packet Storm
- Another Nail in the NebuAd Coffin: CEO Steps Down
- ISP Web Tracking Dead As Net Eavesdropping CEO Resigns
- If Only There Were an Opt-Out Option For Real Life Stalking As Well…
