Open Internet Exchange (OIX) is a new online advertising platform powered by a combination of Phorm’s technology and anonymous behavioural data from the UK’s top three internet service providers - BT, TalkTalk and Virgin Media – representing a combined user base of over eight million households.
OIX has the potential to transform the way that display advertising is sold on the internet, enabling advertisers to target campaigns directly at relevant users, regardless of which site individual banner ads appear on. The ability to target ad campaigns based on an unparalleled realtime analysis of users browsing activity is likely to lead to a very substantial improvement in campaign performance, and therefore attract a substantial proportion of the online advertising market.
Phorm has stated that its technology complies with the Data Protection Act, RIPA and other applicable UK laws. This assertion is based on both a (written) legal opinion and consultations with a variety of organisations such as Ernst & Young, 80/20 Thinking, The Home Office, OFCOM, and the Information Commisioner’s Office.
Phorm’s technology assigns an anonymous cookie with a randomly generated ID number to a user’s browser. As the random number browses the system it compares pages seen with product category definitions (channels) stored in memory. The channels are a combination of rules set by advertisers and based on URLs, search terms and key words on pages. As each page is loaded and compared with the channels any record of that page is deleted instantaneously. No record of browsing behaviour is retained, the Phorm system only stores the anonymous ID, the advertising channel that ID matched and a date. When that random number arrives at a webpage participating in the OIX a targeted relevant ad is then served. No personally-identifiable information is obtained in the process.
The fact that the most important ISPs in the UK market are participants in the platform and are backing it with the full weight of their highly valuable consumer brands is indicative of the potential of the technology for the ISPs themselves.
For some time, ISPs have been seeking ways to diversify their revenue streams away from a reliance on subscriber revenues, given the increasing price pressure in the broadband market. ISPs have been viewing with some urgency the need to expand their ability to generate advertising revenue. To date, these companies have mostly been restricted to selling advertising inventory on their own portal pages. By contrast, when their customers leave one of their own websites to view another publisher’s site, they have lacked the ability to deliver advertising and have missed a significant revenue opportunity. Participation in the OIX will create a new revenue stream for the ISP sector, and will maximise the value of the internet traffic that goes through the ISPs’ networks.
By integrating Phorm’s technology into their own networks, the ISPs should be able to better monetise the wealth of information that they currently control, including users’ viewing histories and the contextual relevance of the millions of websites that their users currently view.
As part of the arrangements with the top three UK ISPs, the ISPs will jointly promote the consumer facing product, WebWise, to over eight million customers. This new product, which will be free to consumers, will incorporate both participation in the OIX and additional new benefits. It will be promoted as providing consumers a “safer, more relevant internet” and has been developed in response to a clear consumer demand for a higher level of online safety.
Thanks Canaccord Adams, 2008
OIX has the potential to transform the way that display advertising is sold on the internet, enabling advertisers to target campaigns directly at relevant users, regardless of which site individual banner ads appear on. The ability to target ad campaigns based on an unparalleled realtime analysis of users browsing activity is likely to lead to a very substantial improvement in campaign performance, and therefore attract a substantial proportion of the online advertising market.
Phorm has stated that its technology complies with the Data Protection Act, RIPA and other applicable UK laws. This assertion is based on both a (written) legal opinion and consultations with a variety of organisations such as Ernst & Young, 80/20 Thinking, The Home Office, OFCOM, and the Information Commisioner’s Office.
Phorm’s technology assigns an anonymous cookie with a randomly generated ID number to a user’s browser. As the random number browses the system it compares pages seen with product category definitions (channels) stored in memory. The channels are a combination of rules set by advertisers and based on URLs, search terms and key words on pages. As each page is loaded and compared with the channels any record of that page is deleted instantaneously. No record of browsing behaviour is retained, the Phorm system only stores the anonymous ID, the advertising channel that ID matched and a date. When that random number arrives at a webpage participating in the OIX a targeted relevant ad is then served. No personally-identifiable information is obtained in the process.
The fact that the most important ISPs in the UK market are participants in the platform and are backing it with the full weight of their highly valuable consumer brands is indicative of the potential of the technology for the ISPs themselves.
For some time, ISPs have been seeking ways to diversify their revenue streams away from a reliance on subscriber revenues, given the increasing price pressure in the broadband market. ISPs have been viewing with some urgency the need to expand their ability to generate advertising revenue. To date, these companies have mostly been restricted to selling advertising inventory on their own portal pages. By contrast, when their customers leave one of their own websites to view another publisher’s site, they have lacked the ability to deliver advertising and have missed a significant revenue opportunity. Participation in the OIX will create a new revenue stream for the ISP sector, and will maximise the value of the internet traffic that goes through the ISPs’ networks.
By integrating Phorm’s technology into their own networks, the ISPs should be able to better monetise the wealth of information that they currently control, including users’ viewing histories and the contextual relevance of the millions of websites that their users currently view.
As part of the arrangements with the top three UK ISPs, the ISPs will jointly promote the consumer facing product, WebWise, to over eight million customers. This new product, which will be free to consumers, will incorporate both participation in the OIX and additional new benefits. It will be promoted as providing consumers a “safer, more relevant internet” and has been developed in response to a clear consumer demand for a higher level of online safety.
Thanks Canaccord Adams, 2008
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