KPN Admits To Using Deep Packet Inspection

Dutch telecom company KPN Thursday admitted scanning customers’ mobile-data traffic, a move that has fired up concerns over privacy issues.

KPN said it uses deep packet inspection, or DPI, to determine data traffic of its customers, but denies scanning the content of data traffic.

This is “theoretically possible,” Daphne van der Kroft, spokeswoman of civil rights organization Bits of Freedom, told Dow Jones Newswires. “When using DPI, you are not looking at the surface layers of data traffic, but as well into the deeper layers, and this violates Dutch law,” Ms. van der Kroft added.

Ms. van der Kroft said with the use of DPI, the company is able to determine if customers use instant messaging, and also scan all data traffic on mobile networks, including the content of emails.

KPN’s customers have increasingly been using instant messaging or Voice over Internet Protocol, or VoIP, services instead of sending text messages or placing calls, and the company plans to charge customers when using these services on mobile devices.

At its analyst conference Tuesday, KPN claimed it is the first network provider that can determine if its customers use text over IP services, like WhatsApp.

Consumers are becoming increasingly sensitive to how companies use their personal data. Apple recently responded to mounting criticisms over data privacy. The company denied claims that it tracks its iPhone users but acknowledged flaws in how it collects and stores data required for location-based services.

In the Netherlands, a Dutch navigation-equipment maker recently caused an outcry after it became public that the Amsterdam-based company sold collected data to a third party that ended up in the hands of the police, which used them to position speed traps.

In April, KPN was forced to issue a profit warning

Google Street View, which allows users to virtually tour locations on a map, has also sparked intense debate over privacy issues across Europe, the U.S. and elsewhere. Earlier this week, Google threatened to pull its Street View application from Switzerland if the country’s highest court doesn’t overturn a ruling that would force the company to blur out every face that appears on the service.

For KPN, the leading Dutch mobile network provider with a market share of around 50%, the use of IP-based services like WhatsApp or Research in Motion’s Ping on BlackBerrys could become a problem.

In April, KPN was forced to issue a profit warning, after its Dutch first-quarter mobile-service revenue dropped 8.1%, and announced it will eliminate 4,000 to 5,000 jobs between 2011 and 2015, which represents around 20% to 25% of its workforce in the Netherlands. The former state monopoly has already slashed almost 10,000 jobs since 2005.

Spokespersons for U.K.’s Vodafone Group and Deutsche Telekom , which operate mobile networks in the Netherlands, could not be reached for comment.

A spokesman for KPN refused to comment when asked if the use of DPI is covered under its terms and conditions for subscribers. The spokesman referred to a company statement that said it is currently investigating if it complied to data-saving rules while using DPI.

The Dutch Data Protection Authority, which said last month that it will fine Google up to €1 million if it fails to comply with a new set of data-protection demands linked to Street View, wasn’t available for comment.

[Source: By Archibald Preuschat, Tech Europe, The Wall Street Journal, 12May11]

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