Phorm aims to raise £15m to continue trials
Phorm hopes to secure £15 million in order to continue its behavioural targeting operations in the UK and South Korea.
The company plans to sell a 19.4% stake through a new share offering in a bid to raise the capital needed to continue trialling its controversial technology with BT, TalkTalk and Virgin Media.
So far, Phorm has failed to bank any significant revenue from its trials – in 2007 the company spent $22.4 million and reported a $32.8 million loss.
In a statement, Phorm said it “intends to use the proceeds from the placing to continue the implementation of its service in the UK and Korean markets, and for general working capital purposes, as the company continues its discussions with other ISPs both in the UK and internationally”.
Phorm’s chief executive, Kent Ertugrul, added: “With the addition of these new funds, we are well positioned to deliver strong growth, as we engage with ISPs across the globe with a view to deployment in multiple markets.”
Last week, the company announced plans to launch a personalised web browsing service, Webwise Discover, which aims to personalise users’ website visits by highlighting the content it recognises they are interested in (see Phorm launches personalised web browsing service).
However, Phorm has come under intense scrutiny over the past few months with the Open Rights Group urging companies such as Microsoft, Google and Facebook to block the online advertising system from tracking users (see Amazon blocks Phorm).
In response, Phorm launched a website – ‘StopPhoulPlay’ – to “hit back at the privacy pirates smear campaign” against its service (see Phorm fights back with new website).
Earlier in the year, Amazon UK and Wikipedia both blocked Phorm from their portfolio of sites and the European Commission started legal proceedings against the UK over the behavioural ad company to address “several problems with the UK’s implementation of EU ePrivacy and personal data protection rules” (see European Commission begins legal action on Phorm).
Phorm is expected to publish its full year 2008 results tomorrow.