BT has banned all future discussion of Phorm and its WebWise targeted advertising product on its customer forums, and deleted all past threads about the controversy dating back to February.

Subscribers to BT's broadband packages had used the BT Beta forums to criticise its relationship with Phorm and raise concerns about the technical implications of ISPs wiretapping their customers.

However, BT decided it had had enough and deleted the threads. A first thread on WebWise extended to almost 200 pages, before being closed in late September when BT's third trial of the system began. It was still available to read however and a new thread was started by BT Beta moderators, which continued until yesterday. All record of either has now been removed.

Phorm expects to launch its targeted ad service in the first half of next year after a successful trial with BT.

Phorm is behind technology that analyses web users' behaviour in a bid to serve up more relevant advertising. The company has been criticised because of fears that its technology will allow internet companies to spy on users.

However, it has taken great pains to explain that privacy is one of its major concerns and that because of the way its targeting works, no identifying information is retained on web users.

Phorm said that the BT trial, which began on 30 September, achieved its primary objective of testing all the elements necessary for a larger deployment, including the serving of small volumes of targeted advertising. BT has said it expects to move towards deployment of the Phorm platform.

Phorm chief executive Kent Ertugrul said: We have met with most of the main players in the advertising sector and they welcome the potential commercial value of the service. We have not set a date for a full launch, as this depends on several factors such as the ISPs, but we are looking at a launch in the near term. This is a first half of 2009 initiative.

News articles based on a survey indicating public opposition to Phorm's web snooping and advertising system have been withdrawn after the firm made legal threats to their publishers.

The independent consumer watchdog Which? sent a press release to newspapers earlier this week entitled Internet users say: Don't sell my surfing habits. It detailed survey findings that UK internet users are opposed to plans by BT, TalkTalk and Virgin Media to monitor and profile their browsing in collaboration with Phorm.

The findings contradicted market research repeatedly cited, but not published, by Phorm that the majority of people want the more relevant web experience it claims its Webwise-branded technology will provide.

The Which? survey was covered by the Press Association, Channel 4 News, The Telegraph, and The Daily Mail. The press release, however, was swiftly followed by a retraction of the press release.

The Press Association, Channel 4 News and Telegraph stories have all been removed whilst the Daily Mail has edited its story to online to remove all references to the negative survey findings.

A Phorm spokesman said that the survey had been based on inaccurate information and that the press release itself contained inaccuracies. It repeatedly stated the Webwise system collects and sells on data which is misleading. We also wouldn't allow the creation of advertising channels on sensitive subjects such as for medical products.

BT must be stopped from deploying technology that uses people's personal internet communications to make money from advertisers, the government was told this week.

Baroness Miller of Chilthorne Domer, Liberal Democrat home affairs spokeswoman, asked in the Lords for the government to delay the rollout of interception-based online advertising until its legality had been established under the Regulation of Investigatory Powers Act 2000.

She told Computer Weekly that Ofcom, the Information Commissioner, the Home Office and the Department for Business Enterprise and Regulatory Reform (BERR) were all passing the buck. Phorm could normalise a level of snooping not even attempted by the Home Office's stalled Interception Modernisation Programme.

Online retailer Amazon has confirmed that it is opting out of the controversial internet advertising service, Phorm.

The company has said that it will not allow Phorm to scan its web pages in order to serve customers with targeted adverts based on their browsing habits.

The Phorm technology, known as Webwise, has been at the centre of controversy in recent months. Last year, BT allowed a trial of Webwise to go ahead without the explicit consent of users. It has now started a new trial of the technology on an opt-in basis only.

Although Phorm has been cleared by the Information Commissioner’s Office of any concerns regarding data or privacy, the European Commission has announced that it is starting legal action against the UK government for the way its data protection laws operate in relation to Phorm.

The EU telecoms commissioner, Viviane Reding, said: I call on the UK authorities to change their national laws and ensure that national authorities are duly empowered and have proper sanctions at their disposal to enforce EU legislation.

The Commission has branded the technology as an interception of user data, and believes there is a legal need for more explicit seeking of consent from users before such services can be rolled out.

And privacy lobby the Open Rights Group has also called on a number of websites, including Microsoft, Google and AOL to opt out of Phorm’s scheme. The group said it expected more companies to follow Amazon’s lead and opt out of the Phorm service.

Phorm introduce their Stop Phoul Play website:

Over the last year Phorm has been the subject of a smear campaign orchestrated by a small but dedicated band of online "privacy pirates" who appear very determined to harm our company. Their energetic blogging and letter-writing campaigns, targeted at journalists, MPs, EU officials and regulators, distort the truth and misrepresent Phorm's technology. We have decided to expose the smears and set out the true story, so that you can judge the facts for yourself.

Shares in Phorm, the controversial online advertising group that tracks consumer behaviour, plunged more than 40% after BT said it has no immediate plans to use the company's technology.

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

Phorm's software has been dogged by controversy following news that BT ran two trials using it without seeking its customers' permission in 2006 and 2007. Tim Berners-Lee, the British founder of the internet, has also spoken out against Phorm.

Phorm said that it is now focused on its overseas business and has made strong progress in South Korea: We are engaged in more than 15 markets worldwide, including advanced negotiations with several major internet service providers (ISPs).

The likes of Virgin Media and Carphone Warehouse are believed to be considering working with the group. However, Virgin Media released a statement suggesting that no deal was imminent. The company believes that interest-based advertising has some important benefits for consumers as well as website owners and ISPs but said it was a fast-changing market and had extended its review of potential opportunities.

Americans do not want to be given tailored advertising based on monitoring of their online behaviour, according to what its authors call the first independent, academically rigorous survey of consumers' views.

Research conducted by the University of Pennsylvania and the Berkeley Centre for Law and Technology has found that 66% of adult US citizens do not want advertising to be tailored to what advertisers think are their interests.

Publishers keen to increase advertising revenue and advertisers have claimed that tracking that does not identify users by name is acceptable to most people, because of the benefits that accrue from being shown more relevant ads. To marketers, it is self-evident that consumers want customized commercial messages, the academics' report says. The survey's data appear to refute that argument.

Contrary to what many marketers claim, most adult Americans (66%) do not want marketers to tailor advertisements to their interests, said the study. We conducted this survey to determine which view Americans hold. In high%ages, they stand on the side of privacy advocates. That is the case even among young adults whom advertisers often portray as caring little about information privacy, it said. Our survey did find that younger American adults are less likely to say no to tailored advertising than are older ones.

This survey's findings support the proposition that consumers should have a substantive right to reject behavioural targeting and its underlying practices, said the report.

Ministers face an embarrassing showdown in court after the European Commission accused Britain of failing to protect its citizens from secret surveillance on the internet.

The legal action is being brought over the use of controversial behavioural advertising services which were tested on BT's internet customers without their consent to gather commercial information about their web-shopping habits.

Under the programme, the UK-listed company Phorm has developed technology that allows internet service providers (ISPs) to track what their users are doing online. ISPs can then sell that information to media companies and advertisers, who can use it to place more relevant advertisements on websites the user subsequently visits. The EU has accused Britain of turning a blind eye to the growth in this kind of internet marketing.

Ministers were warned by the EU in April that if the Government failed to combat internet data snooping it would face charges before the European Court of Justice. The European Commission made it clear this week that it is unhappy with the Government's response and began further legal action to force ministers to address the problem. Commissioners are disappointed that there is still no independent national authority to supervise interception of communications.

Europe's information commissioner Viviane Reding said that the aim of the Commission was to bring about a change in UK law. People's privacy and the integrity of their personal data in the digital world is not only an important matter: it is a fundamental right, protected by European law, she said. I therefore call on the UK authorities to change their national laws to ensure that British citizens fully benefit from the safeguards set out in EU law concerning confidentiality of electronic communications.

The Commission said the UK had failed to comply with both the European e-Privacy Directive and the Data Protection Directive.

Google is now personalizing results even when users have not logged into its web-dominating search site.

Personalization is a euphemism for a Google-controlled practice that involves tweaking your search results according to your past web history. Mountain View was already doing this with users who had signed in to a Google account so they could use non-search services like Gmail and Google Calendar. But now it's targeting results for all users - whether they're logged in or not.

Google has always hoarded the search history of everyone visiting the site - whether they were logged in or not. But this is the first time Google has massaged results for users who haven't signed in. This is just one of the many reasons Google likes cookies.

The company's new cookie-based personalization is based on 9 months of stored data. And it's completely separate from account-based personalization.

Google does let you turn off personalization off. But it's on by default - and we all know that most people will leave it on.

The Crown Prosecution Service has revealed that it is working with a top barrister on a potential criminal case against BT over its secret trials of Phorm's targeted advertising system.

BT had covertly intercepted and profiled the web browsing habits of tens of thousands of its customers, the CPS told campaigners this week that it is still investigating the affair.

The Crown Prosecution Service is working hard to review the evidence in this legally and factually complex matter, a spokeswoman said.

Campaigners gave prosecutors a file of evidence, including a copy of BT's detailed internal report on a trial of Phorm's technology in 2006, obtained by The Register. The experiment monitored 18,000 broadband lines without customers' knowledge or consent.

This week the CPS said: We are currently awaiting advice from a senior barrister which we will review before coming to a conclusion. We are giving the matter meticulous attention and will reach a proper and considered decision as soon as it is possible for us to do so.

The main law BT is alleged to have broken is the Regulation of Investigatory Powers Act (RIPA). It restricts the interception of communications.