In response to a Congressional inquiry about its pilot test of NebuAd's services, internet service provider (ISP) Embarq insisted it revised its privacy policy at least two weeks before it integrated the platform.

NebuAd partners with ISPs to serve ads to users based on their aggregate online activity. The behavioral ad firm sparked a debate over privacy in the Senate earlier this month. Amidst the fracas, it lost a planned liaison with Charter Communications.

"Embarq followed the industry practices of the most similar business model, that of online advertising networks," wrote Embarq SVP David Zesiger of regulatory policy and external affairs in a letter to Reps. John Dingell (D-Mich.), Ed Markey (D-Mass.) and Joe Barton (R-Texas).

"It appears that industry standards in this area are evolving rapidly toward a more robust form of notice and choice."

Lawmakers last week demanded to know whether Embarq tested NebuAd's services without notifying subscribers directly. Its response — that it changed its privacy policy two weeks prior — lends the sense it did not.

"Embarq's apparent use of this technology without directly notifying affected customers that their activity was being tracked, collected, and analyzed raises serious privacy red flags," said Markey.

Phorm, a UK-based company that employs a similar business model to NebuAd's, is suffering similar scrutiny in the European press. Its ISP partner BT worsened the matter when it admitted to running Phorm trials on unwitting customers in 2006 and 2007.