Phorm suffers BT blow

BT has said that it has no immediate plans to roll out the controversial Webwise content recommendation and targeted advertising platform.

The announcement will come as a blow to Phorm, the company behind Webwise, which has been criticised by privacy advocates accusing it of using "illegal" methods to gather data about a surfer's interests in order to serve them relevant advertising.

"We continue to believe the interest-based advertising category offers major benefits for consumers and publishers alike," BT said in a statement.

"However, given our public commitment to developing next generation broadband and television services in the UK we have decided to weigh up the balance of resources devoted to other opportunities," the statement continued.

BT's statement did rule out an immediate deployment of Webwise, though no firm date for a joint BT-Phorm project had actually ever been set. It was widely expected, though, that it would launch some time before the end of 2009.

"We don't have immediate plans to deploy Webwise today. However, the interest-based advertising market is extremely dynamic and we intend to monitor Phorm's progress with other ISPs and with Webwise Discover before finalising our plans," BT said.

How Webwise will work

Phorm played down the significance of BT's statement, saying that it was not simply relying on one ISP or market.

"Phorm’s activities remain ongoing and we look forward to creating the conditions necessary for UK ISPs to move to deployment. In parallel, we continue to focus considerable effort on faster-moving overseas opportunities," Phorm said in its statement.

"In so doing, we have already minimised our dependency on the deployment by any single ISP or in any particular market. In addition to making excellent progress in South Korea, we are engaged in more than 15 markets worldwide including advanced negotiations with several major ISPs," the statement continued.

However, Phorm's share price has dropped 25 per cent since BT's announcement.