Open Letter to the IC on the legality of Phorm's advertising system

RELEASE: 17 March 2008

The Foundation for Information Policy Research (FIPR) has today released the text of an open letter to Richard Thomas, the Information Commissioner (IC) on the legality of Phorm Inc's proposal to provide targeted advertising by snooping on Internet users' web browsing.

The controversial Phorm system is to be deployed by three of Britain's largest ISPs, BT, Talk Talk and Virgin Media. However, in FIPR's view the system will be processing data illegally:

• It will involve the processing of sensitive personal data: political opinions, sexual proclivities, religious views, and health -- but it will not be operated by all of the ISPs on an "opt-in" basis, as is required by European Data Protection Law.
• Despite the attempts at anonymisation within the system, some people will remain identifiable because of the nature of their searches and the sites they choose to visit.
• The system will inevitably be looking at the content of some people's email, into chat rooms and at social networking activity. Although well-known sites are said to be excluded, there are tens or hundreds of thousands of other low volume or semi-private systems.

More significantly, the Phorm system will be "intercepting" traffic within the meaning of s1 of the Regulation of Investigatory Powers Act 2000 (RIPA). In order for this to be lawful then permission is needed from not only the person making the web request BUT ALSO from the operator of the web site involved (and if it is a web-mail system, the sender of the email as well).

FIPR believes that although in some cases this permission can be assumed, in many other cases, it is explicitly NOT given -- making the Phorm system illegal to operate in the UK:

• Many websites require registration, and only make their contents available to specific people.
• Many websites or particular pages within a website are part of the "unconnected web" -- their existence is only made known to a small number of trusted people.

The full text of the open letter can be viewed at:

http://www.fipr.org/080317icoletter.html

QUOTES

Said Nicholas Bohm, General Counsel, FIPR:

"The need for both parties to consent to interception in order for it to be lawful is an extremely basic principle within the legislation, and it cannot be lightly ignored or treated as a technicality. Even when the police are investigating as serious a crime as kidnapping, for example, and need to listen in to conversations between a family and the criminals, they must first obtain an authorisation under the relevant Act of Parliament: the consent of the family is not by itself sufficient to make their monitoring lawful."

Said Richard Clayton, Treasurer, FIPR:

"The Phorm system is highly intrusive -- it's like the Post Office opening all my letters to see what I'm interested in, merely so that I can be sent a better class of junk mail. Not surprisingly, when you look closely, this activity turns out to be illegal. We hope that the Information Commissioner will take careful note of our analysis when he expresses his opinion upon the scheme."

CONTACTS

Nicholas Bohm
General Counsel, FIPR
01279 870285
nbohm AT ernest.net

Richard Clayton
Treasurer, FIPR
01223 763570
07887 794090
treasurer AT fipr.org

NOTES FOR EDITORS

1. The Foundation for Information Policy Research (http://www.fipr.org) is an independent body that studies the interaction between information technology and society. Its goal is to identify technical developments with significant social impact, commission and undertaken research into public policy alternatives, and promote public understanding and dialogue between technologists and policy- makers in the UK and Europe.
2. Phorm (http://www.phorm.com/) claims that their "proprietary, patent-pending technology revolutionises both audience segmenting techniques and online user data privacy" and has recently announced that it has signed agreements with UK Internet service providers BT, TalkTalk and Virgin Media to offer its new online advertising platform Open Internet Exchange (OIX) and free consumer Internet feature Webwise.
3. In a statement released on 3rd March the Information Commissioner's Office (ICO) said:

   The Information Commissioner's Office has spoken with the advertising technology company, Phorm, regarding its agreement with some UK internet service providers. Phorm has informed us about the product and how it works to provide targeted online advertising content.

   "At our request, Phorm has provided written information to us about the way in which the company intends to meet privacy standards. We are currently reviewing this information. We are also in contact with the ISPs who are working with Phorm and we are discussing this issue with them.

   "We will be in a position to comment further in due course."