Tuesday, March 25, 2008

Has Phorm Gone Too Far?

So what happens when your ISP realizes that the information it’s carrying from Web servers to end users is inherently valuable? UK based Phorm recently revealed products enabling ISPs to capitalize on their respective goldmines of consumer data by selling it to advertisers for behavioral targeting purposes. They succeeded in negotiating deals with three of Britain’s’ largest ISPs (BT, Carphone Warehouse and Virgin Media), which effectively provide broadband service to 70% of all British households. While Phorm maintains that consumer privacy is protected and their service has provisions for end-users to opt out; journalists, bloggers and satirists are voicing their concerns.

My previous posts indicate that I am a strong proponent of onsite tracking and the ability to create greater relevance and a stronger user experience for Web site visitors based on clickstream data. The key emphasis here is greater benefits for the end user. These benefits include:

    saving time (by remembering information),
    increasing relevance (by recognizing the context of the visit) and,
    improving the site (by optimizing pages based on aggregated actions).

JupiterResearch shows that consumers explicitly stated they do not want more advertising. This sentiment exposes a distinction between onsite targeting specific to user actions and behavioral targeting at large, generally used for advertising purposes. The realist in me concedes that I am powerless to stop advertising, so it might as well be targeted for me based on my online actions. Yet, I do feel as if I have some control over what ads I see based on the Web sites I choose to visit, knowing that they are monitoring my actions.

I believe that Phorm is overstepping it bounds by using infrastructure to capture everything that users do online and selling that information for a profit to anyone who cares to target them. In my mind, the frightening precedent-setting issue is that infrastructure companies will now have the ability to alter the experience for end users. In this way, sites that subscribe to the Phorm technology can use completely unrelated information about my online habits in attempts to sell me products or services online. Or worse yet, find out things about me that no single site would ever know and draw conclusions about my personal life.

Examples abound in the medical world, and potential exposure from security breaches or misuse of data could threaten job seekers or public figures. Creator of the World Wide Web, Sir Tim Berners-Lee told BBC News that he did not want his ISP to track which websites he visited.
    "I want to know if I look up a whole lot of books about some form of cancer that that's not going to get to my insurance company and I'm going to find my insurance premium is going to go up by 5% because they've figured I'm looking at those books," he said.
I agree that ISP should not have the right to mine customers’ clickstream data, create a comprehensive picture of their actions, preferences and behavior and profit from it in ways that the consumer doesn’t condone or even have any awareness about.

This analogy may be a bit of a stretch, but imagine what could happen when infrastructure monitoring is extended to the offline world. Will the bundled services provider I use which brings Internet, telephone and TV to my home started mining my personal data? Perhaps I make a number of calls to Florida in a given month, will I begin seeing advertisements on TV promoting travel to Florida? What if one infrastructure company starts selling my data to another? Will we get to a point where I flip a light switch in my home and must wait for a pre-roll advertisement to play for low-cost airfare to Florida before I can see well enough to find the toothpaste? What if when I flush my toilet an audio ad for Charmin plays over my home sound system that is delivered wirelessly through my network? These examples may be far-fetched, but they are not too far outside the realm of possibility.

So what’s the solution? I’ll reiterate what I’ve stated in the past regarding personalization and privacy: consumers must be given a choice. Controls need to be in place to enable consumers to opt out of targeting tactics, stop unwanted solicitations and control the information that sites have about them. Consumer privacy is a delicate issue and we’re living in an age where dubious privacy practices abound. It will only take a single breach of online privacy to send the advocates, bloggers and satirists into a tirade. For now, I’d like to help educate the masses about the benefits and realities of targeting and empower consumers to make their own choices.

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