One of the issues I talked about was the possibility of stealing Phorm’s cookies, which I elaborate upon in this post. I have written about Phorm’s system before, and you can read a detailed technical explanation, but for the present, what it is necessary to know is that through some sleight-of-hand, users whose ISPs deploy Phorm will end up with tracking cookies stored on their machine, one for every website they visit, but with each containing an identical copy of their unique Phorm tracking number.
<img = "https://.... ) within their page. The Phorm system will not be able to remove the cookie from an encrypted image request.
Once the website has obtained the Phorm cookie value, then in countries outside the European Union where such things are allowed (almost expected!), the unique tracking number can be combined with any other information the website holds about its visitor, and sold to the highest bidder, who can collate this data with anything else they know about the holder of the tracking number.
Of course, the website can do this already with any signup information that has been provided, but the only global tracking identifier it has is the visiting IP address, and most consumer ISPs give users new IP addresses every few hours or few days. In contrast, the Phorm tracking number will last until the user decides to delete all their cookies…
A twist on this was suggested by “Barrie” in one of the comments to my earlier post. If the remote website obtains an account at the visitor’s ISP (BT, Talk Talk or Virgin in the UK), then they can construct an advert request to the Phorm system, using the Phorm identifier of one of their visitors. By inspecting the advert they receive, they will learn what Phorm thinks will interest that visitor. They can then sell this information on, or serve up their own targeted advert. Essentially, they’re reverse engineering Phorm’s business model.
There are of course things that Phorm can do about these threats, by appropriate use of encryption and traffic analysis. Whether making an already complex system still more complex will assist in the transparency they say they are seeking is, in my view, problematic.