Last week we spoke to the CEO of NebuAD, a behavioral advertising company that uses deep packet inspection hardware on the ISP network to track your browsing activity, and provide ads more tailored to your interests. Techdirt directs our attention to a similar outfit over in the UK named Phorm which, like NebuAD, is insisting that their system maintains user privacy by converting user data into randomized numbers.

Phorm has struck a deal with BT, Carphone Warehouse and Virgin Media -- who collectively comprise more than two-thirds of all broadband access in the UK. The International Herald Tribune guesstimates that British Telecom alone could stand to make $167 million in annual revenue from the new system in 2009. As Techdirt notes this, combined with traffic shaping, will likely result in a drastic increase in encrypted traffic (though users can opt-out of both NebuAD & Phrom's systems).

Phorm makes additional promises about privacy and outlines the way their technology works here. Unlike NebuAD, Phorm is trying to take the creepiness out of their technology by also marketing it as a anti-phishing solution. This is also an effort to try and keep users from opting out of the service, though from first glance it offers no protection users can't get elsewhere:Interestingly it looks like Phorm used to be named 121Media. 121Media used to be in the Spyware business, with some loose evidence suggesting a possible former involvement in rootkits.