One of the most potentially intrusive technologies for profiling and targeting Internet users with ads is on the verge of a comeback, two years after an outcry by privacy advocates in the U.S. and Britain appeared to kill it.

The technology, known as "deep packet inspection," is capable of reading and analyzing the "packets" of data traveling across the Internet. It can be far more powerful than "cookies" and other techniques commonly used to track people online because it can be used to monitor all online activity, not just Web browsing. Spy agencies use the technology for surveillance.

Now, two U.S. companies, Kindsight Inc. and Phorm Inc., are pitching deep packet inspection services as a way for Internet service providers to claim a share of the lucrative online ad market.

Kindsight and Phorm say they protect people's privacy with steps that include obtaining their consent. They also say they don't use the full power of the technology, and refrain from reading email and analyzing sensitive online activities.