BSkyB sparks privacy concerns by trialling personalised TV advertising

In a move that could spark privacy concerns, BSkyB has started trialling personalised TV advertising using information about householders gathered from customer research, postcodes and viewing habits.
 
The company is testing a scheme called AdSmart, in which commercials will be stored on customers' Sky+HD set-top boxes and transmitted during live broadcasting. The aim is to roll the initiative out to its 20 million subscribers next year, although they will receive the targeted ads only if they have given permission to do so.
 
The tactic, known as 'addressable advertising' employs a similar approach to that used in online ads and is intended to halt the advertising drift from TV to the internet. An estimated 50% of all advertising expenditure is currently wasted and agencies that buy TV advertising space are supporting BSkyB's move in the hope that more relevant commercials might prevent viewers from channel-hopping during breaks.
 
A BSkyB spokesman said: "A single male might see an advert for a Mondeo, but the family next door could see an ad for a people carrier. We could deliver localised ads so you might see one for the Ford dealership in your area."
 
The broadcaster is also able to update old ad campaigns, however. "If viewers record a programme at Christmas, we could replace all those Boxing Day furniture sale adverts when the programme is played a month later," the spokesman said.
 
He added that the firm would not target customers by analysing their individual viewing preferences, however, nor would it buy in data about their purchasing habits. The goal is to avoid the controversy that surrounded BT's Phorm system, which tracked consumers' online habits in order to target them with personalised advertising. It dropped the system in 2009 as a result of the outcry.
 
BSkyB's rivals are also following suit, however. Virgin Media has developed a new TiVo set-top box that can identify up to eight different users and their viewing tastes in order to recommend programmes and films based on past choices.