Phorm Controversy Rains On Brown’s Digital Britain Parade

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The UK government launched a campaign to use new technology to help beat the recession – amid a legal dispute with the EC over online privacy

Prime minister Gordon Brown is due to speak at an event today on Britain’s digital future along with business secretary Peter Mandelson and actor Stephen Fry.

However the event coincides with concerns about the appointment of a government adviser on internet issues from a company which has sparked legal action against the UK by European authorities.

The Digital Britain conference kicked off this morning at the British Library and will include speeches from Gordon Brown, Stephen Fry, and Will Hutton, chief executive of the Work Foundation.

Commenting on the aims of the summit, minister for communications, technology and broadcasting, Stephen A Carter said that an effective IT and communications industry was vital to the future of the UK economy.

“This summit will bring together some of the leading thinkers in the Digital Economy. Their views on how to develop our infrastructure, develop our content and creative industries and keep pace with international competition will be invaluable as we finalise our thinking over the next two months,” he said.

Carter’s comments refer to the ongoing work on the Digital Britain Report which is the government’s attempt to draw together plans on how the UK should develop its IT infrastructure and expertise over the coming years. An interim version of the report was published in January this year with the final document due to be released in the sumer.

Speaking at the Digital Britain event business secretary Peter Mandelson said that the UK was experiencing some of the toughest business conditions it has ever faced but digital technologies offer a way out. “They are tough challenges but I think they are also exciting challenges,” he said. “[We must] ensre the competitive edge of our digital communication and creative technologies in the future.”

But despite the government’s work on the summit and the Digital Britain report, the UK’s standing around digital issues was hit this week by the threat of legal action from the European Commission. The EC warned the UK government it will take legal action over its failure to protect users from behavourial ad targeting software – known as Phorm – which has been used by BT and other service providers.

The EC claims Phorm, produced by a London company, contravenes EU ePrivacy and personal data protection rules which cover the confidentiality of communications, and because it intercepts and monitors user actions – in some cases, without the user’s consent.

As well as releasing a direct statement on legal action against the UK over Phorm, Viviane Reding, the EU’s commissioner for information society and media, issued another video message this week which further spelt out the EC’s views on any kind of privacy infringement.

“European privacy rules are crystal clear: a person’s information can only be used with their prior consent. We cannot give up this basic principle, and have all our exchanges monitored, surveyed and stored in exchange for a promise of ‘more relevant’ advertising! I will not shy away from taking action where an EU country falls short of this duty,” said Reding in her video message.

Opposition to Phorm is not limited to the European authorities however. This week Amazon UK announced that it would block Phorm’s Webwise behavourial ad system on its site.

Privacy campaigner, The Open Rights Group, welcomed the move by Amazon and encouraged other web sites to follow suit. “By choosing to block the contentious online advertising system from scanning its web pages, these firms have taken the positive choice to protect their users’ privacy and their own brands. We expect more sites to block Webwise in the near future and also call on ISPs to drop plans to snoop on web users,” the group said.

The UK’s failure to clamp down on Phorm has been further exacerbated by reports this week that one of Phorm’s non-executive directors Kip Meek is also a government adviser on internet issues.

According to The Register, a spokesperson for the department of Business Enterprise and Regulatory Reform said that Meek was appointed as an independent “Spectrum Broker”. Meek’s role apparently involves providing advice on how radio spectrum should be allocated to help develop the UK’s mobile broadband infrastructure.

Meek is also the an non-executive director of government and industry body the Broadband Stakeholder Group (BSG) and was also a board member of telecoms industry regulator Ofcom.

Meek’s appointment is not the only recent questionable choice of IT adviser made by the UK government. Former chief executive of systems integrator LogicaCMG, Martin Reed was recently hired to oversee IT and back-office systems elements of the Treasury’s Operational Efficiency Programme. Reed pushed his retirement from Logica forward in May 2007 following the IT services company’s poor performance and increased spending.

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