BT has shelved its commitment to controversial online behavioural monitoring software Phorm, in what internet privacy advocates are describing as a major victory.

Phorm, which uses deep packet inspection to deliver targeted advertising based on browsing habits, has come under heavy criticism since it emerged that BT secretly trialled the technology in 2006 on 18,000 customers without offering them the chance to ‘opt out’. Subsequent trials have been conducted openly.

BT claimed it was abandoning the trial in a reallocation of resources, but did not rule out further investment in interest-based advertising at a later date.

“Given our public commitment to developing next generation broadband and television services in the UK, we have decided to weigh up the balance of resources devoted to other opportunities,” BT said in a statement.

“However, the interest-based advertising market is extremely dynamic and we intend to monitor Phorm’s progress with other ISPs before finalising our plans,” it said.

Those other ISPs, according to Reuters, could potentially be Virgin Media or Carphone Warhouse, which are both rumoured to be considering a trial of the technology. Nonetheless, BT’s decision was a major blow to Phorm, sending the company’s stock plummeting overnight by nearly 30%.