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IISpy, or I2Spy systems (shorthand for intra-ISP spyware) are behavioural targeting (BT) advertising systems that sit within an ISP in order to scan the content of web browsing and build a profile of your interests so that relevant adverts can be sent back to you.
The phrase was first coined by members of an anti-ISP monitoring forum called Badphorm but no formal definition yet exists by adware vendors of any system that would be classified as such.
Privacy campaigners have argued against any system that sits within an ISP, and in Europe such systems are illegal under the Directive on privacy and electronic communications (Directive 2002/58/EC)
Product vendors argue that behavioural targeting enriches the internet on several fronts. Firstly, website owners are offered an improved click-through rate (CTR), which could increase profits or reduce the amount of page-space dedicated to advertising. Owners of previously thought ad-unfriendly websites are offered a chance to make money not on the subject matter of their website but on the interests of their visitors.
Advertisers are offered better targeted adverts, hence reducing the "scattergun approach" (publish as many ads as possible in the hope of catching a client) and users are offered more relevant adverts: just because you visit the financial pages of a newspaper doesn't mean all you're interested in is financial product and books on investing!
ISPs get paid for allowing access to their network on a per-user per-active profile basis.
Vendors argue that their technology will bring-down the cost of internet access.
Campaigners argue that principals of privacy and human rights are breached by such systems.