Internet firms set to track and cash in on surfing habits of 11million customers

By Sean Poulter
The Daily Mail
Mar. 02, 2009

A system that will allow Britain's biggest internet firms to record and cash in on their customers' surfing habits could go live later this year.

BT, TalkTalk and Virgin Media are all considering launching Webwise, which would track the internet pages that their 11million customers visit.

The system creates an anonymous profile of a surfer's interests, which is then used by retailers and others to target them with related adverts.

Computer users linked to Webwise find that certain sites they visit will automatically show advertisements related to their profile.

The U.S. company behind the system - Phorm - insists it is far less intrusive than the existing tracking and profiling of surfers that is carried out by internet search engines such as Yahoo and Google.

It says there is nothing to link a name or address to the anonymous profile of interests. At the same time, there is no database of users that is sold to advertisers.

Retailers and others linked to the Webwise system will pay websites to place advertisements they know will be targeted at consumers with an interest in their products.

Phorm takes a slice of the price paid by the advertiser and then gives a portion to the customer's internet service provider, such as BT.

The technology means that service providers can grab a slice of the global internet advertising market, which is worth Ł28billion a year.

The technology is said to comply with data protection rules because the surfing information is collated anonymously.

Customers also have a choice as to whether they want to be part of the system.

BT has conducted three customer trials with Webwise.

It emerged last year that the company had secretly profiled the web browsing of thousands of its broadband customers in 2006 and 2007.

The 'stealth' pilot was carried out without the consent of the customers concerned and some believe it was illegal under EU law.

BT has always insisted that the trials were on a small scale and carried out only after legal advice was sought. Phorm and BT insist no laws were broken.

Internet companies are constantly monitoring their customers' use of the internet.

For example, Google's Gmail system scans users' e-mails to create a profile useful to advertisers.

The scanned emails trigger advertisements related to key words they contain even before the message is sent.