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Cost of Digital Economy Act could push broadband prices up

by Sarah Griffiths on 14 September 2010, 15:56

Tags: General Business

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Money money money

Internet providers have warned customers may be forced to pay more for broadband if the Government goes ahead with plans to hit providers with a hefty fee for tackling online copyright infringement under the Digital Economy Act.

Under the new plans, copyright holders would cop 75 percent of the costs for fighting infringement, while internet service providers will have to stump up the remaining 25 percent, The Daily Telegraph reports.

The Government confirmed how it plans on paying for actions laid out in the Digital Economy Act, which would see warning letters sent to web users suspected of downloading or sharing content illegally.

Ed Vaizey, the minister for communications, reportedly said: "Protecting our valuable creative industries, which have already suffered significant losses as a result of people sharing digital content without paying for it, is at the heart of these measures."

"The Digital Economy Act serves to reduce online copyright infringement through a fair and robust process and at the same time provides breathing space to develop better business models for consumers who buy music, films and books online," he added.

The hefty fees for copyright holders and ISPs are thought to cover the cost of getting in touch with suspected infringers plus funding the inevitable appeals process as consumers who want to challenge a ‘notification of copyright infringement' will reportedly be able to do so for free.

While this may seem like (slightly) good news for web users, the ISPs have warned they might have to pass on some of the cost of the fee to their customers.

Robert Hammond, head of post and digital communications at watchdog Consumer Focus told the newspaper: "Consumers should not be picking up the tab for the enforcement of copyright laws that will benefit the music industry to the tune of millions of pounds. The previous government admitted any extra cost on internet service providers may push up the cost of broadband, making it unaffordable for thousands of vulnerable consumers who need internet access to get vital services and cheaper deals."

The ISPA, which represents the ISPs is said to believe rights holders should cough up the whole sum as they stand to benefit the most from the scheme.

But Vaizey has reportedly said the Government's decision is ‘proportionate' to the huge problem.

"We expect the measures will benefit our creative economy by some £200m per year. As rights holders are the main beneficiaries of the system, we believe our decision on costs is proportionate to everyone involved," he reportedly added.

The Government does however appear to be slightly worried that the free appeal system will attract lots of unnecessary challenges and has vowed to keep a close eye on the situation. It has also not ruled out introducing a small fee later on in the scheme's existence if the free process proves a problem.

Regulator Ofcom will implement the notifications which are set to begin next year, while the act must now be rubber stamped by the European Commission before it is put before parliament as a Statutory Order, according to the newspaper.

HEXUS Forums :: 21 Comments

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i hate this country.
Hmm, so legit users are going to have to pay (again) for selfish pirates? Nice…
So we are going to throw money at something just to further prove it doesnt work… great.

Piracy is IMPOSSIBLE to beat, all you can hope to do is minimize it by providing good service at a good price. if iTunes hasnt proved that then what more do they need?
All these stupid anti-piracy measures (DRM and copy protection for example) do is harm legit users, neither are even a minor hindrance for pirates. Something needs to be done about piracy but it shouldn't be at the expense of legit users!
I'm not surprised there are so may pirates though - what do you get for paying for stuff? Shafted. What happens if you steal it? Nothing plus you get a DRM, crapware-free version! And obviously ethics don't come into it for a lot of people…
"Cost of Digital Economy Art" in the title :)