UK web spy firm Phorm got something that Silicon Valley's NebuAd couldn't: That is, government blessing for its plan to track consumer Web surfing through Internet service providers.

MediaPost reports that the UK Department for Business, Enterprise and Regulatory Reform gave Phorm's plan to track UK Web users its stamp of approval because they intend to inform users before doing so. "After conducting its inquiries with Phorm, the UK authorities consider that Phorm's products are capable of being operated in (a lawful) fashion," the agency said.

This puts Phorm one-up on NebuAd, which is stuck in limbo after a Congressional inquiry revealed that several ISPs had implemented NebuAd without notifying consumers. Keep in mind no one has said NebuAd broke any laws, but the bad publicity caused ISPs to suspend work with the company until the House Energy and Commerce Committee finishes its investigation.

But the damage to NebuAd has probably already been done. CEO Bob Dykes jumped ship earlier this month and new CEO Kira Makagon says the company is refocusing on garden-variety behavioral targeting and not the creepier "deep-packet inspection" through ISPs that got privacy groups worked up.

Phorm plans to launch soon with BT Group, TalkTalk and Virgin Media. Will Phorm launch in the US? The company is listed in London, but also has offices in New York and Moscow.

See Also:
Web Spy Firm NebuAd: We're Not Dead And The Doors Are Staying Open
Think Your Internet Provider Might Be Spying On You? Just Check Our List
AT&T To Congress: Google Spies On Web Surfing So We Will, Too