(Adds detail from statement, background)
LONDON (Thomson Financial) - Advertising technology company Phorm Inc. said
it is in advanced talks with a number of British and international internet
service providers over its online advertising platform, and has moved into the
trial phase with some of them.
The announcement comes after the company, which categorizes web-surfing
habits in order to target online advertising, said in February it had signed
exclusive agreements with major United Kingdom ISPs BT Group PLC., Carphone
Warehouse Group PLC.'s fixed-line subsidiary Talk Talk, and Virgin Media Inc. to
adopt its platform and consumer internet feature Webwise.
The company said on Thursday that implementation at these three ISPs is on
track and consumer trials are expected to begin in the near term, followed by
roll-out across these networks.
Phorm has been focusing on getting its technology platform up and running
and building its ISP relationships and stopped generating advertising revenue in
2006. Without revenues and with the costs of investment, pretax losses widened
to $32 million from $11.5 million last year.
The company raised $65 million in a placing last month to implement its
advertising platform which enables targeted advertising based on the search and
browsing habits of the service providers' customers. The system makes the ISP
data anonymous, thereby safeguarding online privacy by protecting the identity
of the consumers.
The company's share price has come under pressure in the past few weeks
following reports of potential compromise of users' privacy, although Phorm
moved to clarify this in a statement in March, saying it will "never store any
personal information, or anything that can identify a user".
"The only information stored is an anonymous random number assigned to a
user's browser, the advertising categories that match their areas of interest
and a time stamp," Phorm said, adding that users would be able to switch the
Webwise product off and that its technology complies with UK law, including the
Data Protection Act.
Phorm said it has started dialogue with the Information Commissioner's
Office, "who are pleased with the way that we have engaged with technical
experts and concerned individuals following the announcement of the service",
and has met with other online privacy stakeholder with encouraging results.
Looking ahead, the company said: "We have built an excellent team and a
market leading technology platform and, as a result, we look forward with great
optimism to the opportunity that lies ahead for our company."
kathy.sandler@thomson.com
ks/wj
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