The three large internet service providers backing a new service from Phorm have stood by the Aim-listed online advertising group in spite of fears over privacy issues sending its shares down 31 per cent.

BT, Virgin Media and Carphone Warehouse’s TalkTalk broadband business, which collectively control about 70 per cent of the UK broadband market, last month signed up to a service that promises them a cut of the fast-growing online advertising market for the first time.