Phorm loses money and members of the board

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Phorm has announced dramatic losses of $15 million but fundraising has helped kept the company afloat.

The losses were incurred in the six months leading up to 30 June and, although significant, they were still $10 million less than the same period in 2008 when the company made losses of $25 million.

Phorm’s chief executive Kent Ertugrul said that the losses were incurred due to “continued investment [into] business infrastructure, technology and people as well as the further development of products” but claimed it was making savings elsewhere.

“During the period we completed our operational restructuring, launched during 2008, and, as indicated at the full year results announcement, reduced our average monthly cash burn to approximately $1.8 million," Ertugrul said in a statement.

“In the six months to 30 June 2008, our average monthly cash burn was $3.1 million. In addition to reducing our monthly expenses, we believe that we have materially improved the effectiveness of our business.”

However, it seems the key to the company’s survival is down to fundraising. In June, it raised $24.2 million before expenses.

It also appears that not all is well within Phorm’s corporate structure as IT PRO has been informed that both its chief technical officer, Stratis Scleparis, and director of corporate communications, David Sawday, have left the company.

Phorm confirmed the departures. Sawday has now joined the communications team for Halfords and Scleparis has left to “pursue other interests.”

The company has also shut down its website stopphoulplay.com, which was set up to defend the company against critics.

In a statement, a company spokesperson said: “We have undertaken a major revision of our online presence which has resulted in the creation of a new corporate website. This has eliminated the requirement for a number of previous sites such as Stop Phoul Play, OIX.com and Webwise.com.”

Phorm has been surrounded by controversy since it became known in the UK 18 months ago.

Concerns were raised around privacy with the technology that tracks internet movements allowing advertising to be targeted to each independent user. The company secretly trialled the tech with BT and had private contracts with other ISPs – Talk Talk and Virgin Media.

A stream of condemnation for the technology has followed, from government groups, the open rights group and even Sir Tim Berners-Lee.

Both BT and TalkTalk pulled out of the scheme and Virgin Media has said it is not planning a roll out.

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