• by Wendy Davis , Staff Writer @wendyndavis, March 11, 2009

As Google is shaking up the U.S. online ad world with its move into behavioral targeting, news comes that another ad company, Phorm, is again under scrutiny in the U.K.

Earlier today, at a Houses of Parliament hearing organized by privacy activist NoDPI.org (No Deep Packet Inspection), Web founder Tim Berners-Lee warned against tracking people online. "It is very important that when [we] click we click without a thought that a third party knows what we're clicking on," he said, according to The Register. "I have come here to defend the internet as a medium."

The comments apparently prompted Phorm CEO Kent Ertugrul, who was present but hadn't been invited to speak, to address the panel from the floor, The Register reported. Ertugrul denounced opposition to ISP-based targeting as representing "neo-Luddite retrenchment," according to the newspaper.

Phorm's platform, which uses deep packet inspection technology, serves ads to people based on information about the sites they've visited gleaned through their ISPs. Phorm says that it doesn't store information about Web sites visited and that the targeting is anonymous, but privacy advocates are still concerned about the platform.

Recently, Phorm completed a test of its platform with BT Group, a U.K. broadband provider. BT notified consumers of that test and sought their consent, but didn't do so in the past. In 2006, BT Group secretly deployed Phorm's behavioral targeting platform in a two-week test that involved 18,000 users. News of the test was first reported last year by The Register.

The secret tests potentially violated Europe's sweeping data privacy laws. Since news about the tests broke, European privacy regulators have repeatedly asked the U.K. authorities whether they intend to take any action.

In the U.S., would-be Phorm rival NebuAd had to retreat from plans for ISP-based behavioral targeting in the face of opposition from privacy advocates and lawmakers.

Meanwhile, U.S. ISPs like AT&T have said they would seek subscribers' consent before selling information about their Web visits to marketers. But some of those companies also have said they think all behavioral targeting -- including programs like the one announced today by Google -- should require opt-in consent.