Digital Economy Act: how are the ISPs reacting?

27 January 2012, 14:28   By Neil Hawkins

THE Digital Economy Act (DEA), rushed through the parliamentary wash-up in 2010 contains a wide range of measures touching upon broadband, mobile phone networks, video games and e-books.

piracy computer
Credit: AlexLMX/

What really got the nation's broadband providers, geeks and tech journos chomping at the bit, though, were the measures introduced to tackle the hornet's nest that is online copyright infringement.

Many ISPs took an instant dislike to the bill after considering that it would almost certainly mean added costs, website blocking and concerns that the legislation was not compatible with EU law.

The act has been vigorously challenged by the big ISPs in court and whilst not affected as much, smaller ISPs also object in principal to some aspects of the Act.

What does the DEA mean for ISPs?

Under guidelines issued by the telecoms regulator Ofcom, broadband providers with more than 400,000 users will be required to send out letters to customers who have downloaded content illegally.

Users who receive more than three letters in a year will face the possibility of legal action and disconnection.

Under the guidelines BT, TalkTalk, Virgin Media, Sky broadband, Orange, O2 and The Post Office will all be required to send out warning letters, smaller providers will be exempt from having to comply with the guidelines.

Even while the bill was being debated in parliament a number of broadband providers spoke out against it claiming that sending out letters and threatening legal action was not going to solve the problem of illegal downloading.

Initial criticism

Some providers - including TalkTalk and O2 - were outspoken in their criticism of the Bill.

TalkTalk pointed out that broadband providers will incur extra costs as a result of all this letter writing and described the guidelines as having the potential to turn into a bureaucratic dog's breakfast, with millions of legitimate internet users falsely accused, put onto an offenders register and potentially ending up in court.

TalkTalk highlighted in its blog that the owner of a broadband connection will be held responsible for protecting their own network from hackers. In the case of businesses with a Wi-fi hotspot, they'll be responsible for their customers.

This could mean that a home owner who has had their network hacked or a cafe owner offering free Wi-fi will be held responsible for any illegal downloading taking place, even if the owner is unaware of the infringement.

Others have also voiced concerns over plans to block websites which offer links or access to illegal content stating that legitimate content could be blocked.

Some have even drawn a comparison between this and the current search engine filtering operating in China at the moment.

TalkTalk has also voiced its concern over the way the bill was passed, highlighting the fact that big music and film companies managed to influence the government (just as they have lobbied ISPs for years) without any proper debate by MPs.

Certainly the numbers don't make pretty reading for British politics: 64% percent of MPs didn't show up to vote, only 80 MPs showed for the second and third reading and a further 187 MPs only showed up at the end of the debate to vote.

After all the furore it is not surprising that the DEA was challenged by two of the UK's biggest ISPs, BT and TalkTalk, who campaigned to have the Act subject to a judicial review.

The BT and TalkTalk judicial review

BT and TalkTalk were granted a judicial review of the DEA in April of 2011.

ISPs protestations

BT and TalkTalk argued that the legislation was not compatible with three European standards - the Technical Standards, Privacy and Electronic Communications and E-Commerce Directives - and also that the Act's proposals to punish consumers accused of illegal downloading were not proportional.

Furthermore, they argued that the European legislation already states that broadband providers should not be held to account for data going though their networks.

They added that the Act impinged upon users' "basic rights and freedoms" and had not received enough scrutiny in parliament.

Creative industries view

Many creative industries and copyright bodies, which broadly support the legislation, were not happy to hear of this news.

Chief among them is the Federation Against Software Theft (FAST), whose CEO James Lovelock said that it was, "staggering that this Act, born out of years of consultation, of debate and of Parliamentary time, is now being challenged in some last ditch attempt by the ISPs to ensure they are not hit financially."

Broadband providers are liable to pay for 25% of the costs of tracking down, warning and disconnecting those accused of illegal filesharing under the Act.

Small success

The judicial review process dealt a hammer blow to the challenge brought by BT and TalkTalk with the judge throwing out their arguments on all but one count.

The judge didn't agree that the government should have notified the EU Commission that the bill made ISPs liable for damages arising after copyright infringement took place on their networks, nor that it breached data protection law, nor that it was a disproportionate reaction to copyright law violations.

An area where broadband providers had a small victory is that they will no longer be required to foot the bill for the setting up of an appeals body. They will however still have to pay a quarter of the costs for the warning letter system proposed by the DEA.

Recently, BT and TalkTalk exhausted their final legal option with the high court in London refusing permission for an appeal against the failed judicial review.

A boost for smaller ISPs?

Whether the fact that ISPs with over 400,000 subscribers will now have to potentially disconnect and shop suspected illegal downloaders to the authorities will mean smaller ISPs benefit with added custom remains to be seen.

A survey by Be Broadband suggests that 47% of filesharers will continue to use filesharing software but are likely to try to conceal their IP address whilst doing so.

AAISP argue that the Act shouldn't have anything to do with ISPs, stating that broadband providers should be treated as the Post Office is, a common carrier.

Trefor Davies, Chief Technology Officer at Timico wrote on his blog: "Blocking is likely to be expensive, ineffective, have unintended consequences (e.g. innocent websites being blocked), [be] seen as censorship, stifle the open growth of the internet ecology and require huge involvement of the judiciary - I certainly would not be happy with ISPs or Rights Holders taking ownership of choosing which sites to block."

Smaller ISPs, it seems, are just as unhappy about the implementation of the DEA as large providers.

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