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BERR - Consultation on Legislation to Address Illicit P2P File-Sharing

This is my response to the BIS P2P Consultation. The submitted response was in the form of a .pdf file and a (slightly modified) version can be found here. Any comments are most welcome on the talk page.

If someone knows how to, could they perhaps sort out the contents so it looks shinyer (without the whole "2.1 3 - thing")? --Duke 23:13, 29 September 2009 (UTC)

Contents 1 Introduction 2 Comments on the Consultation Document 2.1 3 - Current Position & Context 2.1.1 Size of content industry 2.1.2 Estimated damage caused by P2P file-sharing 2.1.3 What's happening elsewhere 2.2 4 - The Proposed Obligations 2.2.1 Preventing and reducing online copyright infringement: the obligations 2.2.2 Notification Obligation 2.2.3 Serious Infringer Obligation 2.2.4 Ofcom power to impose other obligations 2.2.5 Code of practice 2.2.6 Time line 2.2.7 Role of a self regulatory body 2.2.8 Impact on Small Businesses 2.3 5 - Developing regulatory options: better regulation 2.4 Comments on Annexes 3 Questions 3.1 Notification obligation 3.2 Serious Infringer Obligation 3.3 Ofcom power to impose other obligations 3.4 Code of practice 3.5 Role of a self regulatory body 3.6 Impact on Small Businesses 3.7 Proportionality 4 Conclusion 5 Appendixes 5.1 Appendix A: How P2P works and how it could be made to work legally 5.1.1 What illegal P2P file-sharing has to offer consumers 5.1.2 What rights holders have to offer illegal file-sharers 5.1.3 How a legal P2P system could work 5.1.4 A Case Study; Doctor Who 5.1.5 Conclusion 5.2 Appendix B: Glossary 5.3 Appendix C: Spore 5.4 Appendix D: Network Neutrality 6 Notes

Introduction

This response to the Department of Business Innovations and Skills Consultation on Legislation to Address Illicit P2P File-Sharing consists of a commentary on the consultation document as well as answers to the individual questions raised by it. There are also (appended) some summaries of issues that may be of relevance to the consultation and are referenced throughout the response. The response is by an individual, representing his opinions alone. It should be noted that while the respondent has a honours degree (in mathematics) he has no technical or legal training or education, as such, there may be errors or inaccuracies due to the lack of knowledge. As a further disclaimer, the author is a full member of the Pirate Party UK, a political party which (among other things) aims to "Reform copyright law, ... end the excessive surveillance, profiling, tracking and monitoring of innocent people by Government and big businesses" and "ensure that everyone has real freedom of speech and real freedom to enjoy and participate in our shared culture."^[1] However, this document does not represent the opinions of the Party, merely the individual.

All references, links and quotes included were accurate as of replying. There are many direct references to Wikipedia^[2] throughout the document and while it may not be completely reliable as a primary source, it usually contains sufficient information (itself verified and cited) to be viable. It also has a function enabling previous versions of articles to be viewed, reducing the chances of any references to it to be viewed even if the relevant page has subsequently been edited.

Comments on the Consultation Document

This section concerns issues found with the content of the consultation document itself and the 'facts' presented within it. This commentary is not directly aimed at the questions posed but the responses to the questions included make references to the commentary.

3 - Current Position & Context

Size of content industry

3.7

This section notes that approximately 20% of the UK’s market share for music is controlled by just four record labels, which have been known to co–operate closely (within organisations such as the BPI^[3] and RIAA^[4]). This suggests a slightly alarming oligopoly existing in the music industry, with a small number of companies controlling the music industry. It has also been argued that the "record labels" such as these are the main beneficiaries of the current law concerning the copyright on music in the UK (due to being able to buy the copyright to works, create a monopoly on them and benefit from the long extensions to the duration of the copyright - something individuals are unlikely to be able to do). Another fact worth noting is that of the "big four" labels, they (or their parent companies) are based in the United States^[5], France^[6] and the UK^[7] (the fourth, Sony Music Entertainment is owned by the Sony Corporation of America, a subsidiary of Japan's Sony Corporation). Currently, the main countries in which stricter copyright laws and measures to prevent illicit file-sharing are occurring are these ones. While this may merely demonstrate the respective governments protecting the interests of corporations based in their countries, it could be seen as evidence for corporations pushing government policy for their own benefit.

3.9

The quoted 21% increase in spending on films in the UK (between 2007 and 2008) would suggest that the UK film industry is continuing to grow despite the alleged losses inflicted on them due to illicit file-sharing.

3.10

Again, here we see an increase of nearly 50% (£2.2bn in 2006 to £4bn in 2008) in the UK computer game industry. This would also suggest that the sector is not suffering too greatly from the illicit distribution of games through P2P networks.

Estimated damage caused by P2P file-sharing

This section cites various sources to estimate this damage, however there are few direct sources. A particularly helpful study is a paper from the Harvard Business School, published in May 2009, entitled File-Sharing and Copyright. The study gathers the data from various other reports and collates them quite conveniently. Among other findings, it notes

While some studies find evidence of a substitution effect, other findings, in particular the papers using actual file-sharing data, suggest that piracy and music sales are largely unrelated.^[8]

It also states

Overall production figures for the creative industries appear to be consistent with [the] view that file sharing has not discouraged artists and publishers.

It is also worth considering (in cases where figures are given for "industry losses") where the supposedly lost money would come from/where it went. For example, the BPI claims to have lost £180m pa in 2008 due to P2P file-sharing; this figure, whether accurate or not (see notes under 3.12), would suggest that, without P2P file-sharing, the music industry would have made an additional £180m (around 3% of the £6bn it is quoted as "contributing")^[9]. However, one must ask where this money would have come from and if it actually exists. If this figure represents the retail price of every illegal download counted as a lost sale, it would mean that without P2P file-sharing, each file downloaded would have been paid for legally. Research carried out recently by the University of Hertfordshire revealed that

61% of 14 to 24 year-olds use file-sharing networks, with each amassing an average of 8,000 tracks on their computers.^[10]

Now, assuming a (generously low) value of 50p for each track,^[11] that amounts to an average of £4,000 from each individual. It is highly questionable whether people in the 14-24 age group would be able to afford this much.

This idea was examined closely examined in an article for the Guardian which questioned "why ... the music industry [persists] in saying that every download is a lost sale?" and concludes that money is being spent elsewhere within the entertainment industries.^[12] It also shows an increase in the total money spent within the industries. The article also brings up some criticism of the BPI for manipulating/losing their statistics.

Another Guardian article notes that, despite (or because of) illicit file-sharing "2008 was a record breaking year for the UK games industry".^[13] With statistics like this it is difficult to see the alleged significant damage inflicted on the industry by illegal file-sharing.

3.12

This section (rather worryingly) reproduces (without citation) the figures given by the BPI for their estimated losses due to P2P file-sharing and the figure given by an Ipsos MediaCT report which (if this is the correct one) was "conducted on behalf of the film industry"^[14] and suggests that these two (questionably biased) reports make the level of damage clear. Both the groups behind these figures have an interest in inflating the figure. The BPI has come under criticism for misleading or openly lying.^[15] In particular they have been criticised for treating each illicit download as a "lost sale" at full price; a myth that has been widely 'debunked'. The references article also notes where they deliberately turned around the findings of one report to change the tone of the conclusion. Even if these figures are to be trusted, there are allegations that fighting P2P file-sharing could cost the industry even more than theses supposed losses.^[16]

Moving away from the BPI, there are a large number of studies^[17](including one commissioned by Industry Canada^[18]) which seem to disagree with the view that P2P file-sharing is harmful to these content industries. While some of these studies may be a few years old, they should at least challenge the idea that the film and music industries are being "clearly" damaged. More recently a new study conducted by Ipsos Mori found

... people who download and share music and video illegally are amongst the most avid buyers of legal music and video...^[19]

which is similar to the research of other studies.

In conclusion, it is particularly worrying to see a government report quoting industry figures (without citing the sources) and treating them, and them alone, as fact.

3.13

This strikes me as one of the most significant paragraphs in the entire document.

... it is estimated by the Business Software Alliance that the global business software industry suffers annual losses of some US$48 billion out of a total market of US$450 billion due to piracy. The bulk of these losses is caused by unauthorised copying of software within businesses, rather than by P2P.^[20]

This works out as over 10% of their market value. Again the size of this figure may be debatable, but, using the figure given for the UK games industry alone (recorded sales of £4bn^[21] - due to the lack of a figure for the UK software industry) would suggest over £400 million annual "losses" from this industry, the bulk of which comes from within businesses. Whichever value is taken of those given for the losses in the entertainment industry this value is significantly higher which leads to wondering why the government is using significant resources to legislate and halt the use of P2P networks to distribute media rather than try to stop the much greater losses being allegedly suffered by the software industry through copying within businesses. Interestingly, earlier this year (2009) there was a paper suggesting that the ICT industry could save $1 trillion a year by moving to Open Source software.^[22]

Moving on to the figures quoted for games, the numbers of downloads given are more informative when put into context.^[23] The Sims 2 was released in 2004^[24] and has since then sold more than 100 million sales^[25] (it can now be bought used for <£8) and this does not include the (approximately 18) additional packs. As such, the illegal downloads quoted work out as approximately 1% of total sales which does not seem significant compared with the 50%-70% reduction in price over this period.^[26] Assassins Creed was released (on PC) in April 2008, 5 months after the initial release and has sold over 8 million copies as of April 2009.^[27] The figure for downloads works out at close to 12%. However, in this case there has been a significant price reduction over time of up to 85% off the retail value.^[28]

It is also worth noting that of the top 5 downloaded games, 4 are published by Electronic Arts who, after the controversy over their DRM policy^[29] have introduced new anti-piracy measures that they hope will significantly reduce the effect of illicit P2P sharing of their products.^[30] The issue of P2P sharing has been discussed much throughout the gaming industry with several non-legislative and non-punitive measures put in place which may prove effective. The figures given in the Consultation document give the "Most downloaded video games" which does not make it clear that they were illegal copies as there are many legal systems for acquiring video games^[31]

3.14

This section seems to suggest that the various entertainment industries need to work on developing new business models to

...allow consumers to access the type of content they want in a form and manner that best suits them and at a price they are willing to pay.^[32]

It would seem, however, that some elements have elected to push for legislation or commence mass legal action instead. Certain consumer groups are increasingly feeling as though they are being treated as criminals by the industry (with insulting warnings on DVDs and in cinemas, most of which are now being withdrawn^[33], excessive (and often ineffective) copy protection on media (see Appendix C) and legal threats. This has helped to create a divide between the consumers and industry, leading to both feeling less sympathetic towards the other.

In certain communities (such as the news site Slashdot) the film and music organisations (often grouped under the parody initialism MAFIAA^[34]) are seen as the enemy of the community. There are also high levels of distrust between the groups; people feel less guilty about not buying (and feel less willing to buy) products from these organisations due to the hostility (resulting in tools designed to help avoid their products)^[35] However, some companies have listened to and worked with their consumer communities to develop models that are a better compromise:

• Apple responded to criticism of its (breakable) copy-protection on tracks purchased through its iTunes store by removing much of the copy protection technology (allegedly pushing the major record labels to agree to this) and as of April 2009, all files are available in Apple's DRM-free format.^[36].
• After the long-running controversy over the DRM included with video games published by Electronic Arts (see Appendix C) the company have announced plans to remove the invasive technology in favour of encouraging those who have illegally downloaded the product to buy it by adding additional content only accessible through a registered copy.^[37] EA's CEO suggested in interviews that he felt the answer to 'piracy' was to offer a better service than the pirates can, suggesting a radical change in business model (although not enough time has passed to see how successful this approach will be).
• Valve's Steam content delivery system,^[38] despite functioning as an anti-piracy tool has mostly avoided the outcry over DRM systems due to the many advantages the system offers the customer (easy, cheap games, from a variety of publishers, automatically downloaded, installed and updated and with an integrated community section).

A possibly significant aspect of some of these systems has been to reduce the price of content (Valve found that, on average, by cutting prices by 75%, sales increased 1470% (leading to an increase in revenue of approximately 370%), with their flagship game increasing by 3000% over one weekend^[39]). They also observed that:

• Pirates are ahead not just on price, but on service
• DRM appears to increase, not decrease piracy (agreeing with the table on page 12 of the Consultation document as at least 7 of the games listed there contain significant DRM software)
• Shrinking distance to customer empowers content creators^[40]

while not especially relevant to this section, these observations may be worth noting.

3.15

The PRS exampled used in this section as an organisation altering their business model is interesting due to the dispute with Google/Youtube that surrounded this. It was claimed by Youtube that there were

...two obstacles in these negotiations: prohibitive licensing fees and lack of transparency. ... PRS [was] asking [them] to pay many, many times more for [their] licence than before. ... PRS [was] unwilling to tell [them] what songs are included in the license they can provide.^[41]

As a result of this dispute YouTube blocked access to much of the possibly-infringing content to users in the UK (only), with the songwriters/publishers, musicians and music fans/YouTube users losing out (due to the lack of licence fees, "free" publicity and "free" music respectively). It was alleged that this dispute helped the PRS in deciding to reduce their per-play rates by 60% rather than increasing it. The dispute was settled in September.^[42]

This highlights an example the change in business model being forced/pushed by dubiously legal consumer action (those uploading videos to YouTube).

3.16

This section suggests that what is being sought is a "legal alternative to P2P". Firstly, P2P software is not inherently illegal, but more importantly, why is P2P software to be avoided? To my knowledge, one thing lacking from most of the examples of "new" business models is the use of P2P software, which offers a very powerful and efficient way of distributing content. As described in Appendix A, P2P software has been demonised by much of the media industry (going back to the idea of hostility between communities mentioned in 3.14) and yet could represent part of a solution to the problem. Illicit file-sharing has advantages over most of the current legal models due to offering a faster, more reliable and more encompassing service at a lower price.^[43] The industries need to consider both these issues when looking for solutions (legislation and legal action addressing neither) and a legal P2P system (as was developed for the BBC's iPlayer^[44], Channel 4's 4oD^[45] and BSkyB's Anytime^[46] video on demand services) offers advantages to the consumer and content provider on both price and quality of service.

3.17

There are several organisations that would wish to challenge or change the Copyright, Designs and Patents Act (1988) or the relevant sections including, but not limited to, the newly formed Pirate Party UK.^[47] Part of their core ideals is that the law is not up to date with technology and a 10+ year-old law on copyright that has not been challenged would seem to be an example of that. ::-Obviously this would need editing if this response was made on behalf of the party --Duke 02:11, 27 September 2009 (UTC)

What's happening elsewhere

3.19

The consultation document seems to suggest here that it was unfortunate that La Loi HADOPI was defeated at several stages in its creation (both by the National Assembly and the French Constitutional Council). Rather, this shows how controversial such a law would be. Such laws seem to put legal power in the hands of corporations and eliminate the possibility of a fair trial as well as the ideal of "innocent until proven guilty" as the legal system would be unable to cope with such a law^[48] and the cost estimate (£15 million a year) seems somewhat excessive. There were also allegations of trickery involved in the passing of the law, with only 16 (of 577) MPs being present at nearly 11pm when the vote was not expected for several days.^[49]

3.21 & 3.22

The recording and film industry in the US has been attempting (and demonstrably failing) to tackle P2P file sharing for several years; shutting down websites (through direct legal action^[50] or pressuring foreign governments^[51] which have had little effect. They also had several campaigns of sending takedown notices and threatening legal letters to suspected infringers which have resulted in 2 trials.

It should be noted that in both the case of AT&T in the US and Eircom in Ireland the decisions made were unpopular (and in the second, forced through legal action)^[52]

3.23

The law in New Zealand^[53] was allegedly pushed to enable the country to "sign a free-trade agreement with America"^[54] but the specific section relevant to this discussion (Section 92A) was abandoned after receiving criticism from "New Zealand artists, technology specialists, ISPs, businesses, media commentators, librarians and members of the public."^[55] Perhaps the UK government could follow from their example, due to there being similar opposition here.

4 - The Proposed Obligations

4.2

The key concern here is the definition of "reasonable levels of proof" and how the information collected is ensured to be and to what extent it is "anonymised". One of the potential troubles with the proposed law (mentioned above, and which has also been a concern of the French HADOPI law) would be the volume of traffic it could create for the court system (particularly with an estimated 7 million people sharing files illegally)^[56] Another concern would be over the fairness of such a system; it would be up to the rights holder^[57] to select which cases to pursue, enabling them to potentially focus on 'weaker' targets, less likely to be able to legally defend themselves (such as students or those on benefits). This would seem to breach the traditional impartiality of justice.

4.3

Of the suggestions for methods ISPs can use suggested here, two seem reasonable (and are already in place in some systems; those of bandwidth capping and shaping. However, it would be difficult to restrict these to possibly infringers as it is very difficult technologically to determine if infringing is taking place. While it is relatively easy to detect P2P traffic, such traffic is not, of itself, illegal (and punishing those using it would also affect the legitimate users) and bandwidth capping would act similarly. If these methods were to be put in place, they should be clearly laid out in the contract between the consumer and ISP. Due to the difficulty in identifying infringing traffic immediately (even with invasive and potentially illegal monitoring of data) content filtering would also seem impractical.

Blocking would seem to be the easiest method but on deeper consideration raises some important and somewhat alarming issues;

• Firstly, allowing (or forcing) ISPs to block certain sites, IP addresses, protocols would be a significant step against the principle of net(work) neutrality^[58]. There are more details on this idea and the issues surrounding it in Appendix D. Once you allow ISPs to interfere with how the consumer accesses the internet there is a danger of losing some of the great benefits of this global network; consumer choice, freedom of communication, freedom of information and freedom from discrimination. Currently consumers are in control on the internet; being able to choose between content and services freely from (nearly) any part of the internet no matter who owns the network. It should not be up to private companies with individual, commercial goals (ISPs) to decide what to make available. In the extreme, this could lead to ISPs blocking their competitors, charging websites to not be blocked or censoring content they feel contradicts their commercial interests. Cutting off information channels^[59] can be seen as a severe means of repression (arguably breaking Articles 10 and 14 of the European Convention for the Protection of Human Rights and Fundamental Freedoms).^[60]

Network neutrality has been hailed as a desirably benefit across internet communities; in one instance a comment by a certain ISP's CEO claiming that "this net neutrality thing is a load of b****cks"^[61] created enough worry to force the company to calm fears by stating that it did "not intend to hinder access to content providers who do not pay."^[62]

Breaking net neutrality would also remove the concept of ISPs being safe from liability for copyright infringement under the "safe harbour" idea of laws such as the American Digital Millennium Copyright Act.^[63]

• One must ask who would decide which sites are to be blocked and what reasons are acceptable. Currently, in the UK, the Internet Watch Foundation^[64] "provides a dynamic list of URLs for websites which contain potentially illegal child sexual abuse content"^[65]. Despite the noble intentions of the organisation it has come under serious criticism for supplying false positives (blocking sites that are not illegal), the apparent "forced adoption" of their blocklist, the legality of their operation and the secrecy and technology behind it.^[66] If an organisation is set up that has the power to force ISPs to block certain websites this system would be open to abuse (as described above) and such a system would need to address all of these issues (being open, sufficiently independent to be free from bias, accountable to the consumer and have a system to appeal decisions at the least).

If private organisations (ISPs, Media industry lobby groups) are given the power to decide what content can be viewed on the internet the system is open to abuse as described above (with the potential of corporate interests being put above the freedoms of the people - although, arguably, this entire debate is based on doing just this). If a government department is in charge, this could lead to allegations of government censorship and removal of freedoms of speech.

• It is important to consider which sites would potentially be blocked by such measures. Typically the websites used to locate files to download via P2P software merely contain databases of where the files can be found elsewhere and function in a similar fashion to a search engine. In fact, most common search engines can be used for locating the relevant files (for example, a search on Google for "Wolverine filetype:torrent" returns approximately 113,000 results^[67]) also the widespread distribution of such files would mean that an excessively large number of sites (compare that 113,000 with the 1000 currently blocked by the IWF) to have a significant effect. If only sites that 'enabled' or 'aided' illegal file-sharing, then every search enging (including Google) would have to be blocked under such legislation. Not only is there the issues of not catching enough sites, but there is also the issue of generating 'false positives'. Many websites (such as the Pirate Bay) host torrent files for content that is legal (or legal in different countries), for example, music by independent artists who are increasingly seeing the advantages of distributing material for free via P2P networks, and so shutting down or blocking such sites could negatively affect legitimate users.

• Finally, we must question how effective such measures would be. If certain sites, ports or protocols were blocked to prevent P2P file-sharing it would probably just result in the file-sharers changing to new methods (different sites). This is best demonstrated through the effects of the recent case against The Pirate Bay,^[68] arguably one of the largest indexes of content (some legal) available through BitTorrent P2P networks. In August the site was shut down by legal action by the media industry against the site's ISP's ISP. Despite the questionable legality of the case - it was compared with suing a company that makes the tools (the ISP's ISP) for the company that builds the roads (the ISP) which are operated by a company (The Pirate Bay), because people are speeding (illegal file-sharers) - the website was cut off, however this resulted in a minimum downtime of 3 hours with the site being fully operational within 24 hours.^[69] It should also be noted that cutting off the Pirate Bay also led to several other services, hosted in the same location, being cut off despite the court order only being for the dubiously illegal content hosted on the Pirate Bay,^[70] demonstrating one of the many possible issues with blocking sites - the lack of precision with targeting. There are also systems already in place (or being worked on) that would legally help users bypass any blocks and restrictions put in place such as The Onion Router^[71] and IPREDator^[72], which was set up specifically to counter the controversial^[73] and draconian^[74] EU Directive on the enforcement of intellectual property rights. Any technological method of restricting access to illegal content that is desired by as large and well-educated (technologically) a community as in the case of P2P file-sharing will be eventually rendered ineffective. This is not an 'arms race' that any government or corporation can win. Arguably, it is not even one that the government should consider taking part in, merely to support the failing business model of an industry.

It should also be noted that any of the measures described in section 4.3 of the consultation report would target entire households or subnetworks, not just the individual infringers. The actions of one illegal file-sharer could result in punishment and restrictions being applied to many other non-offenders who share the same connection.

4.4

It would be helpful if "stakeholders" could be defined clearly. The current situation appears to be that this discussion is happening between the government, ISPs and content the pro-copyright lobby (who have the most to gain). There appears to be little input (aside from these consultations) from the general public or the anti-copyright lobby. This is partly due to the dispersed nature of this 'faction'. While there are numerous^[75] communities and organisations (such as the Open Rights Group^[76] or the newly-formed Pirate Party UK^[77]) there is no central body comparable to the BPI or IFPI and as such their opinions seem to be ignored (such as with the recent controversy surrounding Lord Mandelson's sudden involvement in this issue^[78] - while there may be an estimated 7 million illegal file-sharers in the country, they (nor individuals like the author) tend not to get the opportunity to have dinner with senior government figures).

4.7

Similar to the points made under section 4.4, it is questionable whether an "industry" body would be the best way of dealing with this issue as such a body would seem to not have a representative of the consumers; specifically the file-sharers (legal or otherwise). This "fight" is happening between 10 international corporations (4 record labels and 6 film companies - all with billion-dollar incomes) and several million individuals - an industry body would run the risk of listening to the commercial interests of companies over the views of the general public.

Preventing and reducing online copyright infringement: the obligations

4.8

As mentioned above, involving ISPs in this issue opens up many different problems; ethical, technical and legal and is something that would need to be very carefully considered (rather than, for example, some senior minister deciding that anyone accused of infringing be cut off from the internet). As with much of this document (perhaps unsurprisingly, considering the title) there seems to be a focus on legislation and technical measures designed to stop illegal P2P file-sharing from happening. Such measures have proved impractical, ineffective or excessive wherever they have been attempted. More focus should, perhaps, be placed on finding alternatives; encouraging illegal file-sharers (many of whom download for convenience or as a sample, while still buying or owning the product legally)^[79] to use the legal avenues of acquiring content by making them at least comparable (if not better) in terms of quality of service.

A similar debate occurred in the 1970s and 1980s when another new technology was hailed by the film and TV industry as threatening their existence. Much lobbying occurred to force legislation that would stop the spread of VHS 'piracy' (including use of the FBI - compare with the issue over the Wolverine film). However, as we now know, the legislation was abandoned and yet the film industry continued to thrive; by offering their own VHS recordings of products at higher quality and lower (or comparable) prices to the 'pirates', resulting in much of the 'pirate' VHS industry collapsing. Perhaps a similar approach should be taken here; P2P technology is a very powerful way of mass-delivering content and the industries might be better considering using it (as some organisations such as the BBC have) rather than outlawing it and criminalising their customers. There is an interesting film made by the US movie industry in 1979 that deals with the issue of cassette piracy^[80]. In hindsight it is obvious what the 'solution' was and what they are doing wrong, and yet we see the industry making similar decisions now - substituting cassettes etc. for file-sharing and that video could have been produced within the last year.

Notification Obligation

4.9

This paragraph notes that the ISP can only notify the relevant account holder. It should be emphasised that from the ISPs position, there is no method of telling who has commited the actual infringement (on the assumption that they are given sufficient evidence that such an act has taken place). Multiple users may have access (openly or secretly) to any network.

4.11

Again the distinction between a 'rights holder' and 'content creator' should be noted here. This section seems to suggest that companies could be founded simply to persue such cases. There is a risk that legislation forcing ISPs to comply could lead to the creation of a new 'witch-hunting' sub-industry; corporations who try to identify illegal file-shares and then charge rights holders to provide the data (either to them or directly to the ISP). For example, the UK law firm Davenport Lyons^[81] was mired^[82] by allegations of sending "threatening letters" demanding money from alleged infringers^[83], many of whom claimed no knowledge of the infringing material:

when Watchdog sent [the alleged infringer]'s computer to expert Nigel Pugh from Forensic Footprints, it turned out that the [material] had never been on her computer at all.

This action led to an official complaint being lodged with the Solicitors Regulatory Authority by Consumer group Which?, complaining of "bullying" and making "incorrect assertions about the nature of copyright infringement".^[84] It should be noted that the firm failed to take any of the infringers to court.^[85] Clearly the cost of sending such letters was low enough and the letters effective enough that the firm was able to collect money (including from innocent people who were too afraid to challenge the accusations) to make a profit. There were also accusations of companies buying the rights to material and then uploading specifically so legal threats could be made; specifically a company granting the exclusive right to distrubute the material through specific P2P networks.^[86] Any legislation compelling ISPs to act should include restrictions on who can send infringing letters, ideally only the ISP after being notified by a third party acting directly for (with written permission from) the rights holder, should include strict guidelines on what such a letter should say (such as not demanding money and the inclusion of methods the receiver can use to verify/challenge the allegation) and severe enough penalties for 'false' accusations (including accusations of infringing copyright not held by the accuser) to prevent organisations 'fishing' and only beginning the process when they are confident their claims are correct. The legislation should also either force the rights holder to pursue the legal action (if challenged) or add punitive charges if the action is dropped when challenged. This would also help prevent malicious rights holders from launching 'attacks' on ISPs (particularly the smaller ones) by forcing them to comply with the legislation on large scales.

4.14

The report suggests that rights holders should "establish an infringement on the balance of probabilities."^[87] However, this statement would seem to be remarkably vague. As such an allegation is effectively a legal threat the evidence should be enough to stand up in a full trial (which is likely to occur if any legislation is put in place).^[88] Current methods used by firms to identify those infringing copyright over P2P networks has been widely criticised with techniques being judged illegal in Switzerland^[89] and Italy^[90] and with legal action being taken in the US to challenge the methods used^[91] and with one firm involved ignoring regulators by continuing with legal action despite being told to cease.^[92]

Firms have also come under fire after their technology to track file-shares resulted in a total of 13 letters being sent to "3 laser printers and a wireless access point".^[93] The study that discovered this concluded that:

• Practically any Internet user can be framed for copyright infringement today.
• Even without being explicitly framed, innocent users may still receive complaints.^[94]

Clearly the technology involved is unreliable.

Due to the nature of P2P technology (described in Appendix A) there are many technical and philosophical complications with identifying and defining copyright infringement through this method, as well as the general technical issues with identifying individuals across the internet. It should be noted that there is no way of uniquely identifying one individual. For example, IP addresses do not uniquely identify one account holder; one account holder does not identify the computer; which doesn't identify the user and users are not limited to one computer; which is not limited to one account; which, in turn, is not limited to one IP address.

4.15

Some issues should, perhaps, be raised over the concept of "automating" a legal process. One would expect that the ISPs should, at the least, be obliged to check that the claim of infringement is reasonable (for example, if there is a significant amount of traffic from the identified account at the specified time). It is possible that the volume of notifications should be restricted to a "reasonable" level by legislation (if it occurs) but with the the expectation that any rights holder (or their representative) who wishes to send out notifications on a large scale consult the relevant ISPs first and come to a private agreement.

4.18 Costs of notification obligation.

The process of obligatory notifications is essentially a legal action taken by the rights holder (or their representative) against the individual infringer and therefore it would be logical to treat it as such. The ISP is merely acting as an intermediary; providing the rights holder with information. As such, perhaps the costs of the process should be borne by the rights holder (who has the most to benefit), which should help reduce the cost-effectiveness of mass-sending notifications, with the possibility of the costs being recovered from the accused infringer if they are found guilty or do not challenge the accusation. This would also encourage the rights holders to fully pursue any action, rather than relying on threats. Unfortunately this would rely on the result of accurate identifications being the payment of money to the rights holder in compensation (which is something that the industries have not been concerned with previously, as demonstrated in particular by the Davenport Lyons example, but which is increasingly being seen as the wrong approach within the industry^[95]). Alternatively, it could be seen that it is up to the rights holder to determine if the cost of identifying infringers and sending notifications is worth the expected gains from a subsequent decrease in illegal file-sharing. If the music industry is losing £180m pa as they claim, logically they should be willing to spend up to this amount to solve the problem. If they are unwilling to do so, that would suggest that their figure has been inflated at some point. Making the rights holder pay the costs would also potentially encourage them to make their system more reliable and efficient.

Forcing the ISP to pay some of the cost would result in higher fees for internet services which is unlikely to help create the 'Digital Britain' that is currently desired. Also, as ISPs can be seen as delivering a service, causing them to pay some of the costs could be compared to forcing the Royal Mail (or whichever provider is used to deliver the notifications) to pay the costs. It would also be sensible to get some estimate of the costs before any legislation is put in place.^[96]

Serious Infringer Obligation

4.19 & 4.20

Many ISPs do not provide static IP addresses to their customer with the result that the an IP that was identified as allegedly infringing may not (at a later date) be assigned to the same customer as it was when the identification took place. Similarly, two separate IPs infringing at different times may belong to the same account holder. To help identify users (and to comply with the Part II of the Anti-terrorism, Crime and Security Act 2001^[97]) ISPs can keep a record of which addresses were assigned to which account holder at different times. However, in order to maintain a list of how many times individual accounts have been accused of infringing copyright, the ISP must either link the number to the account or create a separate database of anonymous identifiers (which they alone can link to the account holder), the number of notifications received and the IP addresses assigned at certain times. In the former case, it would be unlikely that they would be able to supply the information 'freely' (as opposed to 'on request') to rights holders without contravening the Data Protection Act 1998^[98] thus the ISPs would be forced to create the separate database, described in the latter case, which they could then publish to the rights holders who could check the database themselves. However, they would need to ensure that the identifiers used were completely anonymous.

4.21

This section raises the question of why legal action should only be taken against those identified multiple times. This would seem to imply that the rights holders were encouraged to discriminate in pursuing legal action - choosing which cases to take.

Ofcom power to impose other obligations

4.23

The arguments against the possible measures listed here can be found under the commentary for section 4.3. The study here notes that "technology changes"^[99] and it could be suggested that the way to deal with new technologies is to embrace them and try to use them as best as can be, rather than to legislate to restrict their use. It is worth noting, however, that P2P technology has been around (and used for illegal file-sharing) for at least 10 years now.^[100] Also, it is questionable whether Ofcom's "long term objective" should be specifically to "reduce copyright infringement significantly" or to help the content industries develop suitable business models while encouraging cultural development.

4.27

Comments on the use of "stakeholders" can be found under 4.4 and examples of powers being used "frivolously" are mentioned in 4.11. The report seems to suggest that "concerted action from the industry to change consumer behaviour"^[101] is desirable. Traditionally (as the author understands) businesses are expected to change and adapt to the whims of the consumer, not the other way around. Perhaps the government should be looking at ways to help encourage the industry to change in order to adapt to consumer action (including P2P file-sharing).

4.28

This section contains some rather crucial ideas; that any legislation

is objectively justified, proportionate, transparent and does not unduly discriminate [and has] an effective right of appeal which provides remedies and redress in appropriate circumstances.^[102]

In deciding whether measures comply with this, it is important to ensure that the voices of the consumers, individuals and technology experts and considered as well as those lobbying for legislation. It is also important to remember that those who would require the appeal process may be particularly vulnerable (i.e. not having the legal expertise, sufficient funds to afford legal advice or the knowledge as to how to acquire it).

Code of practice

4.29

The reference to the "urgency of the problem" is slightly puzzling. As mentioned earlier, the use of P2P file-sharing for the illegal distribution of copyrighted materials has been occurring for at least 10 years and cassette tapes have been around since the the 1960s^[103] and are used for sharing copyrighted music (and video/software). The issue of illicit file-sharing and copyright infringement has been around for as long as there have been files and copyright. For example, the work of Gilbert and Sullivan was hindered by the existence of "pirate productions", particularly in the United States, where (at the time), copyright law only applied to American authors; "In 1879 an American newspaper reported, 'At present, there are forty-two companies playing Pinafore about the country...' Yet from this unprecedented American success, not one penny of profit came to Gilbert and Sullivan."^[104] There is no urgency to the issue of illicit file-sharing and it could be suggested that any sense of urgency could lead to rushed legislation that could prove to be unsuitable later. It should be noted that the Gilbert and Sullivan case revolved around commercial copyright 'infringement', whereas P2P file-sharing is almost exclusively non-commercial.

4.35

It is encouraging to see reference to fining rights holders who provide "incorrect evidence" or use "a flawed identification process" but as mentioned under section 4.14, such fines should be prohibitive (similar to the basis of the legislation in prohibiting illicit file-sharing) in nature; discouraging rights holders (or agents acting on their behalf) from raising frivolous challenges.

4.37

Protection for consumers is particularly important. As noted in the case of Davenport Lyons mentioned earlier, some people feel threatened by receiving official-seeming or legally technical documents and more afraid of the implications of a costly court case and so are reluctant to challenge accusations that they know are false.^[105] As such, the entire process, particularly the appeal, should be transparent and clearly laid out to consumers in language they can understand.

Time line

4.40

This section also implies that there is some sense of urgency; suggesting that "there may be further scope for shortening the timeline". As mentioned earlier, there is no significant reason for rushing any legislation and, due to the international scope of the issue, as and decision or legislation is likely to examined around the world, it would seem important to ensure that it is as fair and suitable as possible.

Role of a self regulatory body

4.42

There is reference to an "industry body" being established. It would be important to ensure that such a body does not become another industry/corporate-monopolised body (such as the BPI or PRS); being controlled by those who have the most to gain by tougher copyright measures such as large record labels (noting that it has been claimed that "most artists profit from piracy"^[106], "weaker copyright protection [benefits] society"^[107], many musicians feel that "it's not a crime to download"^[108] and that "the major record labels are [songwriters'] biggest 'commercial' opponents"^[109]) with no input from consumers or content creators. Any body that is "co-ordinating education and awareness raising" should be similarly regulated to prevent bias; illustrated by the notorious and much-parodied "educational" anti-piracy adverts produced by the MPAA and added to DVD titles released in the UK claiming that "downloading pirated films is stealing"^[110] when, in the UK, Oxford v. Moss (1979) 68 Cr. App. Rep. 183 ruled that "information could not be deemed to be intangible property"^[111] and thus downloading pirated films should not be legally defined as theft or stealing, rather it should count as copyright infringement (falling under the Copyright, Designs and Patents Act 1988 rather than the Theft Act 1968).^[112]

4.43

It is crucial that non-rights agency stakeholders have proper input into this debate (as, hopefully, will happen through this consultation). Unfortunately (as mentioned elsewhere) there are few significant "consumer groups" involved in this process and due to the potential legal issues, those who do use P2P networks to download content illegally feel too afraid to openly discuss it (particularly when faced with such powerful corporate "enemies" as the multi-billion-pound media industry). However, increasingly groups are forming such as the Pirate Party UK (now an official political party)^[113]. However, such organisations will struggle to compete with the pro-copyright lobby and so Ofcom (and the government) must ensure that they are allowed to speak their opinions and that their voices are heard.

4.44

The blocking of sites has been commented upon earlier as being both ethically and legally dubious and ineffective. If anything, Ofcom should be ensuring that ISPs are not blocking legal content and that measures are in place to allow consumers and site owners to know that the sites are blocked and who to consult to discuss the issue. As for "illegal sites", it should be noted that the website TV-links.co.uk^[114], a website that listed links to TV shows uploaded elsewhere (similar to the principle of sites such as The Pirate Bay and other BitTorrent sites), was shut down with the owner being arrested under Section 92 of the Trade Marks Act 1994^[115] ( not the Copyright, Designs and Patents Act 1988 ) and was "not ... charged with any offence, and has ... released pending further investigation."^[116] The site itself, while widely used as a source of television episodes, was not illegal and so would not be covered under this legislation.

4.45

It is worth considering that if information such as an IP address can be used to identify an individual (for the purposes of initianting legal action, for example) whether or not it would count as "personal data" and thus be governed by the Data Protection Act.

Impact on Small Businesses

4.53

The concerns raised here seem to add to the suggestion of making rights holders (or their agents) cover the costs of carrying out the obligations put on them by legislation. Otherwise smaller ISPs may be vulnerable to attacks from malicious rights holders, who could, for example, distribute the content they own the rights to through that ISP (there have already been examples of companies being accused of deliberately distributing files for commercial gain^[117]) so they can force large costs on the ISP potentially putting it out of business, for the benefit of a competitor.

4.54

Interestingly the idea of "active file-sharers migrating to" other ISPs would seem to be an example of consumers choosing a better/more suitable service. Once again, we see that the consumers are affecting the markets but proposed legislation would forcibly disrupt this.

4.58

P2P file-sharing has been around for 10 years and thus one can assume that it functions reasonably at speeds below 1Mb/s. In fact, for larger files at low speeds or with less reliable connections, P2P file-sharing may be more suitable that 'traditional' methods as the data is broken into smaller pieces which can be individually downloaded and then re-assembled (see Appendix A).^[118]

5 - Developing regulatory options: better regulation

5.3

Once again, it is worth emphasising that any legislative process needs to use "the best evidence from a wide range of sources" and needs to be "fair to everyone", not just ask for opinions and then repeat what the industry lobbyists have said, as the consultation document appears to have done so in section 3.14.

Comments on Annexes

Annex B: Acknowledgements

This list of organisations appears to consist mainly of content owners, rights groups and ISPs with no obvious examples of the anti-copyright lobby or (with the exception of Consumer Focus) consumer organisations. This suggests that there may already be a bias in the process even before the consultation which is worth noting.

Annex C: Identifying the infringer

The processes used by rights holders to identify on-line breaches of copyright has been discussed earlier and the rather large technical problems (such as printers being identified as downloaders^[119]) with their methods. Other potential problems are discussed in section 4.14. In the case of P2P file-sharing, the rights holder (or their agent) attempts to download the copyrighted material in question from a file-sharing website and then notes the IP addresses from which the file is being downloaded. This has many flaws;

• IP addresses can be spoofed or faked^[120] (the uniqueness of IP addresses has been discussed earlier)
• IP networks can be broken into (as mentioned in the consultation document) and not just with malicious intent,
• On P2P networks a downloader rarely acquires the entire file from one uploader. The main principle behind P2P technology is that the uploading is spread across a number of users (as upload speeds provided by IPSs tend to be significantly slower than download speeds) thus any one uploader is likely to have only supplied a small subset of the material. The file is assembled on the downloader's computer.
• There is no guarantee that the specific uploader has the entire file; as long as they have some of the file, data can be downloaded from them. This raises the question of whether the entire file is copyrighted or if subsets of it are.
• The individual "pieces" transferred (the smallest unit to have to come from a single uploader) may be as small as 64kb (or even smaller - that was the size found on a quick sample). This is a stream of 65526 (64 x 1024) bits, each of which is either a 1 or 0. Hence this data is expressed as a number (of less than 2^65536 in this case). It is debatable whether such a number itself can be copyrighted (as this would create "illegal numbers"^[121]) and it is entirely possible that a "piece" in one file could be identical to one in another file. In fact, a number with an infinite number of digits in their decimal (or binary) expansion (such as the mathematical constants pi, e or phi) must contain any finite number within that expansion and hence any digital file appears "in nature". This again raises the rather interesting issue of what is actually copyrighted; in the case of a music track, the recording (which is likely to be unrecognisable and impossible to recover from just a subset of the whole file) or the digital encoding of the data (which is just a number).
• There is no guarantee that the data downloaded is the correct data. It may have been corrupted, either unintentionally or deliberately, thus meaning that the uploader has not infringed the relevant copyright.
• The file downloaded may not be the copyrighted file in question even if it is titled as being particular material
• In order to gain "evidence" of uploading, an agent must download the file which, unless they have been given specific permission by the rights holder to do so, could be considered an infringement itself.
• Even if it is assumed that the process of identifying the account holder for one IP address, there is no guarantee that that individual was the uploader, new the uploading was taking place or owned the computer on which the infringing files were.

As with elsewhere in this response, technical details of how P2P file-sharing networks function is based on the author's knowledge and familiarity of the BitTorrent protocol^[122] which has been gained through legal use.

It is encouraging to see that the consultation document acknowledges that

the process by which rights holders [identify] the internet connection used... cannot be regarded as a reliable indication that the broadband subscriber identified was the individual responsible for the infringement or will have knowledge of the individual responsible

This would seem to imply that the evidence collected by rights holders is not reliable, thus breaching the guidelines and requirements set in the consultation document as the basis for any legislation.

Annex D - What effect will these obligations have?

Certain paragraphs of this section require commentary;

It is also clear that a big attraction for file-sharers is pre-release material. ... It is also this material which is arguably the most damaging in terms of revenue to the content industry. The recent release of "Wolverine" was marked by the posting of a pre-release copy. This was downloaded an estimated 100,000 times in one day.^[123]

It would be interesting to see the arguments put for this material being the most damaging. In the case of the film "X-Men Origins: Wolverine", the "leaked" version was an "incomplete and early version" with much of the CGI missing. One viewer noted that "even if you see the workprint you're still going to have to go see it in the theatre"^[124] and the publicity over the leak only increased the spread of the file. Yet despite the leak, the film still made an estimated $35 million on its first day^[125] with $5 million just from midnight showings^[126] with a global opening total of $158.1 million, placing the film as "the 16th highest-grossing opening day ever".^[127] The film is now estimated to have collected over $370m worldwide (ranking it 128th)^[128] and this is despite it receiving review-ratings of 36% on the review site Rotten Tomatoes^[129] and 43 (out of 100) from reviewers and 5.8 (out of 10) from users on Metacritic.^[130] This puts the industry's claim of losing out due to the leak in a slightly different light, particularly as this one (supposedly highly-pirated) film has made significantly more within half a year based on cinema sales than the estimated annual losses due to P2P file-sharing given by the IFPI.

In the case of the U2 album; despite (or potentially because of) the leak the album topped the charts in at least 28 countries (reaching 2nd in Sweden and 3rd in Russia)^[131] with opening UK sales of 157,000^[132] and with at least 991,000 sales in the USA.^[133] With the average price of the CD on amazon.co.uk being £14.22, the UK opening sales alone work out at over £2.2m (working out at over 10 times that including all the sales listed on the referenced Wikipedia article) it is hard to feel that the sales were damaged.

IFPI’s 2007 Music Report that states: "We have taken some 30,000 actions against illegal filesharers globally and, as the research in this report shows, these actions clearly work. Illegal file-sharing in Europe was contained last year against a 30 per cent increase in broadband household penetration."^[134]

Upon consulting the Report in question, it states that

recent findings ... in key European markets (UK, Germany, France, Italy, Spain and Sweden) suggest that IFPI’s legal campaign against large-scale uploaders is having an impact.^[135]

However, by this time there had been no significant legal action taken by the IFPI within these countries - in the UK in particular, the campaign of sending letters started over the summer of 2008. If it is assumed that the "the highly publicised launch in Stockholm of an international wave of actions" refers to the Pirate Bay Trial^[136], it should be noted that the initial action (the Swedish police seizing their servers, allegedly under political pressure from US media lobby groups) led to the number of users of the site (once it was operational again; a few days later) more than doubled.^[137] and the publicity surrounding the trial 3 years later (including the strong allegations of bias by judges) was hailed as responsible for a sudden increase in membership of the Swedish Pirate Party helping them win enough votes in the subsequent European elections to have an MEP^[138] More recently, a similar party in Germany gained 845,904 votes (2%) in the general election in September 2009^[139] with polls suggesting they received up to 13% of the votes from male first-time voters. This would suggest that even if there has been a reduction in the number of illegal file-sharers, there has been an increase in interest in the surrounding issues.

It is also worth examining the methodology of the study. It claims that the action is having an impact at reducing file-sharing and notes that the percentage of internet users "regularly sharing unauthorised music" remained roughly constant (at 15%) from 2004-2006. But they also note an increase of 190% over the same period in the percentage of households with broadband. Assuming that the percentage of illicit file-sharers of broadband users is the same as for all internet users this represents a net increase of nearly 180% (0.032% to 0.056%). It is important to remember that statistical analysis can be easily manipulated to suggest dubious conclusion^[140] and treat the "facts" offered, particularly by 'interested parties' carefully. Finally, even assuming that there was a decrease in file-sharers correlating with the increase in legal action, one cannot directly imply causation as there may be many other factors contributing partly, or wholly to the change.

In August 2008, action taken against an individual who placed a video game on-line resulted in a £16,000 fine (£6,000 fine plus £10,000 costs).^[141]

The relevance of this is questionable as;

• the campaign in question, discussed earlier, resulted in the law firm receiving an official complaint,^[142]
• the ruling was a default judgement as "the recipient of this huge penalty did not defend herself, she did not respond to letters and her side of the story has never been heard"^[143] - as such it was impossible for her to win and the referenced article notes that of the 6 cases pursued by the law firm, all were against people who did not reply at all and only 4 (as of that article) had received default judgements.
• this was not a "serious repeat infringer" as described in the consultation document; the legal action focussed on one instance the sharing of one piece of software (a video game).

Questions

Question 0: Is legislation on P2P file-sharing needed?

This question is the most important and yet was not included in the report. The current evidence for the effect of file-sharing on industry is varied, with rights holders (or rather, their umbrella organisations) claiming that they are making large losses (although even their figures are debatably significant) with other studies suggesting that file-sharing is helping industry and society. Even if an industry is struggling due to not changing to a suitable business model to cope with consumer action, is it the place of the government to introduce legislation to protect corporate interests at the expense of the people? Over the last 10 years (and longer) the content industries have been given an opportunity to use an amazing set of technologies based around the internet to help them distribute their content and yet the response of the larger groups (although not all; some corporations have adapted quite successfully, for example Valve)^[144]) has been to ignore the technology and them complain that they are making losses due to consumers using the technologies without them. Recently the Sony Pictures CEO was quoted as saying that he is someone "who doesn't see anything good having come from the Internet"^[145] - could it be that it is the industry that needs to change, rather than the law or consumer behaviour?

Notification obligation

Question 1: Is this restriction right? Is there anyone else who ought to have a right to trigger the obligation?

This restriction should, if anything, be stricter partly to prevent the possibility of the commercial exploitation of the obligations and legislation. This is discussed under 4.11.

Question 2: Should there be a time limit from the date of a specific infringement by which a require needs to be made? If so, what should it be?

A time limit might help ensure the validity of the evidence gathered, i.e. within the time limits imposed on ISPs for retaining data and to reduce the possibility of complications due to an account holder changing account (through moving house or changing ISP). However, any limit would depend on the length of time the process of detecting infringements takes and must be long enough to ensure that the rights holder (or agent) can be thorough. Possibly a limit somewhere between 1 and 6 months would be suitable.

Question 3: Is this list right? Is there anything else that should be specifically added to this list? Should there be any more detail on any of these points in the legislation, or is it OK to leave that for the code?

Such a letter should, ideally, be standardised throughout ISPs and rights holders and include, as well as the items listed (with the possible exception of details as to how to secure wireless networks)it should include;

• what was allegedly downloaded and when,
• the appeal process available,
• where to get legal support,
• method of lodging an official complaint if the individuals feels they are being unfairly targeted,
• confirmation that not responding is not an "admission of guilt" and that they are under no legal obligation to act on the notification

Any documents should be clearly laid out in plain English (avoiding too much technical or legal material that might confuse or frighten account holders) and any facts stated (particularly under "information about copyright and why it is important") are accurate and unbiased. This is discussed in section 4.11 & 4.12.

Question 4: Does this need to be set out in any more detail in the legislation, or is it sufficient to require it to be set out in the code?

Setting out guidelines on the level of evidence (in consultation with the judicial system and technical experts) would help prevent potential issues if (or when) a case ended up in court and such evidence was legally challenged. This would lower the possibility of resources being 'wasted' in cases where the evidence has not been thoroughly checked. However, legislating might result in the judiciary feeling that any evidence that appears to comply with what is set out would, by itself, be sufficient and not require investigating and thus should be avoided. The level of evidence is discussed in section 4.14 and the commentary to Annex D. It should be noted that any legislation for a proposed process for dealing with infringers should under no account bypass or act as a replacement for the judicial system.

Question 5: This obligation is specified without any volume limit. Is that right? Should there be a restriction on how many notices a rights holder can serve, or that an ISP needs to honour (either from a specific rights holder or in total)?

The imposition of a numerical value to a limit would seem extreme and potentially arbitrary. Rather, any legislation should specify a "reasonable limit" with Ofcom having the power to investigate any specific rights holder upon receiving complaints from ISPs about the volume of notifications. It would then be up to Ofcom to determine if this limit was broken based on the specific details (the rights holder, the ISP, whether complaints have been received from other ISPs etc.). See section 4.15.

Question 6: Alternatively should volumes be agreed (say) 6 months in advance between rights holders, ISPs and Ofcom to allow ISPs to prepare accordingly?

Again, rather than legislating, it would seem preferable to encourage ISPs and rights holders to discuss this on a case-by-case basis between themselves and come to some unofficial (but transparent) agreement. This would be then reviewed alongside the effectiveness of the legislation as a whole or earlier if a large volume of complaints is received. See section 4.15.

Question 7: Is this approach to costs the right one? Is there anything else in relation to costs that should be taken into account in the legislation? Should the legislation specific exactly how costs are to be shared or is it right to leave some flexibility in how the legislative requirements are reflected to the code?

The legislation should make it clear that ISPs should not be forced to pay costs. In relation to costs, the figures provided by the industry for their 'losses' should be taken into account; for example, if a rights holder claims to be losing £n million due to P2P file-sharing, they should be willing to spend nearly as much in preventing or reducing illegal file-sharing. This is discussed in section 4.18.

Serious Infringer Obligation

Question 8: Do you see any legal difficulty with linking a new notification with a previously gathered set of anonymised data in this way? If so, what specifically is likely to be the problem?

This is discussed under 4.19 & 4.20

Question 9: There is some evidence that further warning letters result in a further reduction in people file-sharing. Do you think multiple letters should be sent ... and, if so, what should trigger these?

The number of letters sent would seem to depend on the methods used to detect infringers. Due to the emphasis on stopping serious or repeat offenders, perhaps it would be better if the first letter was sent after 2-5 notifications were received (to reduce the effects of 'false positives' or 'accidental' users) with the second being sent after 5-15 and then in multiples of 5 or 10 depending on the methods used. Possibly there should be no upper limit on the number of letters sent, leaving the decision of when to proceed to the rights holder. While there should be some escalation in the tone of repeat letters, they should all still follow the guidelines stated above and avoid any 'threatening' content.

Question 10: Do you agree to the approach on costs set out here? Are there any additional factors that we should take into consideration here?

This is discussed in section 4.18 and the response to Question 7. There seems no logical difference why the number of notifications should affect anything other than the rights holder's willingness to pursue legal action.

Ofcom power to impose other obligations

Question 11: Do you agree with the list of further measures that could be imposed and the conditions to which their application must satisfy?

As described in section 4.3 the measures listed are either extreme, morally or legally questionable and/or ineffective. There application (if used) must be under sufficient conditions that a legal case could proceed against the account holder with a high probabilit of success for the rights holder.

Question 12: Is 12 months about right to allow a proper assessment of the efficacy of obligations? If not, what would be a better period, taking into account the need to react both expeditiously and on the basis of good evidence?

This time limit (along with the others mentioned) would seem to depend on the technology and methods used and, in this case, the response to Question 2. Enough time should be given to allow methods and technology to be put in place and for any study on the efficiency to be verified (ideally independently and by a variety of sources). More details on the questionable nature of studies are given under Annex D - quote 2.

Code of practice

Question 13: Do you agree with this list of things that Ofcom need to satisfy themselves of before approving a code? Is there anything else that Ofcom should be obliged to consider before approving such a code?

This list appears to be suitable, although particular emphasis should be placed on (b) for reasons discussed throughout the response.

Question 14: Do you agree that a code needs to be in place in time for common commencement? Is it realistic to expect such a code to be developed in less than 12 months, could it be done sooner, and if not what would be a realistic estimate?

It would seem reasonable to have a common commencement of activity and to insist that the code be ready in time for this. As discussed in section 4.29, any sense of urgency felt may be false.

Question 15: This list seeks to set out all the requirements of the code to enable the operation of the first two obligations. Does it do so? Is there anything else that the code must cover in order to enable the effective operation of those obligations and if so, what?

This list would seem suitable for the purposes described. The resulting code should also be widely published among all stakeholders.

Question 16: Are there any other restrictions or requirements that should be placed on Ofcom in pursuit of their role in relation to this code?

Other than ensuring that Ofcom remain impartial, independent and transparent, there would seem to be no restrictions or requirements.

Question 17: What are your views on the time line suggested above, and the ways in which it could be reduced? Are there other ways in which this could be shortened without hazarding essential safeguards and the need for decisions to be made on the basis of the best available evidence?

As described elsewhere (particularly in section 4.29), there would appear to be no particular reason to rush this processes however there should be safeguards in place to ensure that there is enough time for fair, independent studies.

Role of a self regulatory body

Question 18: Do you agree that this is an appropriate role and structure for the rights agency?

It is critical to ensure that any such agency is unbiased and representative of all the stakeholders, not just those with large lobbying budgets. It should not exist (as with the entire legislation) to protect or expand the commercial interests of an industry, rather it should uphold and offer guidance on the law. If the potential agency is accused of merely supporting industry policy this would likely increase the hostility between the various groups involved. Sections 4.42 to 4.45 try to raise the main issues with this.

Impact on Small Businesses

Question 19: Do you agree that we should proceed with an intention to exempt small businesses? If so, have we chosen the right criteria?? Do you have a preferred method of exemption? Please give reasons if you object or if you foresee any unintended consequences not discussed here.

Protection for small businesses should be covered under the responses to Questions 1, 5 and 6 and they reference the relevant sections that discuss possible consequences.

Proportionality

Question 20: Do you consider there to be a case for considering any exclusions on other grounds including technical or proportionality? Please give reasons.

There would seem to be no other grounds to consider, with the possible exception of excluding public networks such as those within public libraries or schools from being affected by any measures to restrict illegal file-sharing, rather relying on them to deal with it internally.

Conclusion

The consultation seems, on the whole, to be well-thought out with only a few issues being noted on the details of the proposed legislation. However, the respondent strongly feels that any legislation is unnecessary and could potentially be harmful to consumers, artists, content producers, ISPs and the country's international reputation, with the only real gains being made by the legal profession and the companies who have hoarded the copyright of others (such as the major record labels who are allegedly songwriters' "worst enemy"^[146]). Illicit P2P file-sharing and relaxed copyright do not harm artists^[147], society^[148] or consumers, with some artists (specifically the Featured Artists Coalition^[149] saying that it should not be a crime to download.^[150] "Blaming piracy is easy. But it hides other underlying causes."^[151] Perhaps the Department for Business, Innovation and Skills should be strongly encouraging the sectors of the content industry that are not already doing so to come up with innovative 'solutions' themselves rather than considering controversial legislation designed to prop up their failing business models at the expense of the rest of society.

If the Department should also note the points raised in section 3.13 concerning the potentially far more significant effect of software 'piracy' by businesses.

One final quote worth considering is this, from a new artist:

"Fans go to shows, buy merch and support bands for all the right reasons. I’ve downloaded lots of albums I loved and bought physical versions. I’ve downloaded plenty of albums I hated and deleted. I can’t begin to count how many bands I know and love because of Napster/Soulseek/Bittorrent. File-sharing was never really about stealing music, it was about finding music you loved. Labels will complain and sue their very core audience just to make a dollar. I can’t blame them, it’s the way they’ve built their company. Change scares them, especially when they don’t control it. I honestly believe that I wouldn’t be a musician today if Napster hadn’t appeared. I think Napster fostered the incredible current musical culture and nobody gives them credit for it. I find it very hard for an upcoming artist to get any exposure without being willing to promote their music on p2p networks."

The clash between artist and labels, and the ever increasing piracy statistics are forcing the big labels to rethink their business models. Nowadays, BitTorrent has the power to promote artists based on their music, not on the advertising budget. It is hard to deny that the music labels are in a crisis, however, music itself is more alive than ever before.^[152]

Like cassette tapes and CDs, P2P technology has the potential to be the future of the content industry, if only the current executives will let go of their out-dated ideas. This cannot be achieved by the proposed legislation.

Appendixes

Appendix A: How P2P works and how it could be made to work legally

Several P2P (peer-to-peer) protocols have been developed over the last decade and this response will focus on BitTorrent; the protocol with which the author has the most familiarity. As such, some parts of this s will apply only to this case, but others to all P2P technology.

The Internet can be seen as one global file-sharing network (with various sub-networks). The principle behind it is that there are connections between servers and computers all around the world through which data or information can be transmitted and exchanged. Traditional methods of transferring data (such as websites, email, specific file-upload sites such as YouTube^[153], flickr^[154] or MegaUpload^[155]) involve the data being uploaded by one individual to a central server where it can be accessed and downloaded by individual from any part of the internet who have sufficient access. However, this process relies on the integrity of that server; if anything happens to disrupt access to the data on it (such as the server losing connection, being damaged or the data being deleted) then the entire network fails. Also, the server needs sufficient bandwidth available to cope with the requests. For popular websites (or for hosting large files) this can be expensive. A main cause of websites failing or being hard to access is due to too many connections attempting to be made and access files on the server (sometimes known as the Slashdot effect^[156]).

P2P sharing bypasses these issues. Rather than the content being hosted on one server, it is hosted in a network of locations (on users' computers, for example) with the data being uploaded and downloaded from one computer to another. Central servers ("trackers" or indexes) are often used to keep a record of where the file can be found and so where it can be downloaded from. While it is possible for sharing to occur on a one-to-one basis (with one person copying a file from one other person) typical upload speeds provided by ISPs are considerably smaller than download speeds (for example, Virgin Media's 10Mb download package has a maximum upload speed of 512kb^[157]) as the majority of users' traffic is downloading this can be a very tedious process for the downloader (or "peer") as they are restricted by the uploader's speed. P2P networks can avoid this problem by breaking down files into "pieces"; smaller chunks of data (varying in size at least from 4MB to 32kb, but with no limit); then, rather than one uploader (or "seed") having to provide the entire file in one go to the peer (a process that can easily be interrupted by connection failures at either end) each piece can be separately copied from different seeds simultaneously, thus making better use of the higher download speed than upload speed available. This also means that in the event that any one computer is disconnected (crashes, looses connection etc.) the only data lost are the specific pieces being downloaded at the time. Once all the pieces have been downloaded the entire file can be assembled from them. Another advantage of this method is that in order to download of another user, it is sufficient that the uploader have at least one piece that the downloader does not, thus one peer can copy some of the file from another peer while they are still downloading it themselves. Significantly, none of the content is necessarily stored on any one site - websites such as the Pirate Bay merely host the indexes and trackers and act as a search engine.

As can be imagined, this technology enables files to be distributed rapidly and with the cost in bandwidth, time and hard drive space being spread across many different users. The BBC used this to great effect with their iPlayer service; initially, the BBC did not have the infrastructure to cope with the download requests of viewers wanting to access the video files it hosted, so a P2P service was set up whereby the BBC hosted the file and a tracker for the service so that members of the public could download files, at potentially very high speeds, from each other. P2P software also has an inherent control for coping with the more popular files; the more users attempting to download a file, the more peers there are connected and so the more places there are to download the file from. It can be quickly determined what files are popular within P2P communities by looking at the number of seeds and peers for each file.

For a content distributor, this process has a significant advantage over server-based distribution channels due to much of the cost being borne by consumers. In fact, once the file has been downloaded a few times, the contend distributor can remove the file from their system and yet the file can still be distributed.

The main disadvantage of P2P networks is the reliability. If a file is unpopular and there are very few seeds (or in some cases, no seeds; with the initial seeder no longer hosting the file) it can be impossible to complete a download, with files becoming "stuck".

P2P file-sharing is often compared to the practice in the 70s-90s of copying records/music onto cassette tapes to then share among friends. When confronted with this, industry representatives claim that this is not the case due to the scale of the sharing. While the scale is notably different, it may not be in the way the industry would like the general public to think. There are suggestions that file-sharing involves copying to thousands or millions of people and while there are clearly millions of people involved, it can be easily shown that the average number of times each user uploads a file to another through a P2P network is 1. Due to the nature of the technology, for every bit downloaded by one peer, it must have been uploaded to them by one other peer. Similarly, every bit uploaded must be downloaded by one peer. As such, for every bit, piece or file uploaded, it is downloaded once. Thus the mean upload to download ratio must be 1:1. P2P file-sharing is thus not like sharing a cassette with a few friends, but with just one friend. What is different is that that friend is part of a much larger, global, online community.

What illegal P2P file-sharing has to offer consumers

Availability

There is a general consensus that "if it exists, it is on the internet". Due to the work of file-sharers, there is very little content that cannot be found on P2P networks. As the process involves sharing files with anyone and potentially everyone on the internet, there is a high chance of finding anything desired somewhere. Popular files (as mentioned earlier) can be found very quickly, often with options for different formats or versions and some material which is no longer legally available anywhere (such as episodes of the BBC's Classic series Doctor Who).

There is also a time advantage. Due to licensing agreements many TV series are broadcast in different countries with significant delay^[158] (and with some series not appearing at all)^[159] and as such there is a large incentive^[160] for fans of the series to acquire the episodes as soon as possible and usually there is no legal way.

Similarly, files (particularly films and TV episodes) are put on file-sharing networks with subtitles for different languages. This unofficial translating is done for free by fans and enables the much wider distribution of media (some of which may take years to be available in other languages, if ever).

Accessibility

All that is required to acquire files (such as music tracks or films) through P2P networks is an internet connection (and possibly a "client"). A file that is desired can be quickly found through a number of different search or index sites (including the Pirate Bay or Google) and then can be quickly downloaded (depending on the popularity and connection speed; an album may take minutes, a film a few hours) directly to the user's computer. This has considerable advantages over traditional distribution models (such as buying CDs, even online) although, increasingly content distributors are making their files available for direct download (such as the iTunes store, Amazon's MP3 download service or Valve's Steam content distribution system) - a process driven by consumer action and the economic advantages.

Freedom of use

An audio or video file downloaded illegally from a P2P network can usually be copied onto as many systems as the user desires (including burnt onto CDs) and played with no restrictions. They are typically free from any form of DRM (although, again, distributors are beginning to supply drm-free products) and (partly due to their illegal nature) are free from legally confusing or restrictive licence agreements.

Storage

A digital download file can be easily stored on a hard drive and with hard drive prices falling (1TB of space being available for significantly less than £100) there is little to limit on how many files can be stored. A standard 3.5" desktop hard drive has a volume of less than 380cm^3 ^[161] and (at 1TB) can store over a thousand films at reasonable quality (and less than 1GB each). A standard DVD case has a volume of approximately 360cm^3 ^[162] thus around 1000 digitally downloaded (or "ripped") films can fit in the same physical space as one DVD. This makes storing and transporting downloaded material much easier. Many people who have downloaded files already posses physical copies but find the inconvenience of transporting (and even using them) compared with instantly playable digital files worth the potential risks of downloading.

Community

P2P networks can easily develop a feeling of a community. By sharing files with many different people from across the world it is possible that users feel a part of something larger than themselves - the principle of P2P file-sharing relies on people seeding files (continuing to share them once they have finished downloading) which there is no obligation to do (and is the main risk for attracting legal action). The users can develop a certain sense of honour and pride about their efforts in helping others and spreading culture.

Price

Price is an advantage of the illegal files. While it may not be as large an advantage as some might suggest, for the student on a budget, if material can be acquired for free rather than for a fixed price, this has an obvious attraction, enabling the individual to choose to spend what money they have on the product if and when they can or on other materials. Illegal downloading also offers the possibility of 'trying' material, to see if it is worth buying upon a recommendation. It is worth noting that once a track or film has been converted to a digital format it is arguably valueless; due to there being a near-infinite supply (the number of copies that can be made is only limited by the hard drive capacity of the world) and a finite demand. There is also feeling that the current prices charged for content are arbitrarily high (due to the costs of distribution being so low) and with record labels and other rights-holder organisations making billions of pounds in profit, many users are less reluctant to pay such high prices.

What rights holders have to offer illegal file-sharers

Legality

While there are some illegal file-sharers who just want the material for free, a large proportion would prefer a legal option that had a comparable service. While such services are beginning to appear for music files the same does not appear to be happening yet with the TV or film industry.

Reliability

As mentioned above, one of the main troubles with P2P sharing is when there are no seeds left. If a rights holder were to act as the initial seed for a file, there would be a guarantee that the file could be downloaded. With an official system there is also a lower risk of getting damaged (or malicious) files; a small concern of illegal P2P sharing

Higher quality

In some cases, files available on P2P networks may be of low quality (due to being recorded in cinemas or directly from the television) although high-quality files are also available in some cases (for example, DVD-rips). Rights holders potentially have access to the highest quality possible.

How a legal P2P system could work

A legal service would need to offer most or all of the advantages of the illegal service, ideally offering other things as well, to help draw users. Consider a content producer (such as the BBC). They wish to set up an alternate, legal service. This could be done by forming their own P2P network (such as the original iPlayer service). They would not even need to develop their own protocol as services such as BitTorrent already offer the possibility of private trackers which can restrict access to authorised users. The producer could then offer their content for download through this service. Theoretically, they would not even need to host initial seeds of the content; they could offer immunity from possibly prosecution and/or free/discount access to users who initially seed the content themselves (after checking the validity of the file if needed). In order to make the service appealing, however, they would need to ensure that the above conditions were mostly met. The files would need to be of a reasonable quality, available as soon as possible, be free from restrictions (possibly other than insisting that the work be not distributed elsewhere; this would need to be done on 'trust' as technical measures to enforce this (DRM) would count as a disadvantage compared with illegal networks - the producer has nothing to lose by doing this as the content would most likely be available elsewhere anyway) and be at a reasonable price.

Possible pricing options would involve advertising on the indexing site or using a private tracker and forcing registration, then using either a registration fee of sorts (monthly payments) or mirco-payments for each file. Due to the low cost of maintaining such a system, the payments could be significantly lower than even current content distribution services (such as iTunes) and the cost to the content producer of making the material could be lessened by the requirement of less advertising/marketing (if a file on a P2P service is good it usually becomes widely known through the community aspects and as the peer count increases on one file, more people are likely to download it due to the perceived popularity and faster speeds; as such less marketing would be required) and (in the case of music, mainly) not being forced to produce CDs. It would also give the producer the ability to instantly change the price of files; decreasing over time, perhaps - or having sales at certain times^[163] and potentially giving away older content for free. For a possible example of how the interface for such a model could work, Valve's Steam^[164] is worth examining, although that system is not P2P and includes some DRM technology. The interface makes it very easy to find and purchase games (downloading and installing them automatically) as well as offering a library for browsing installed games. Even if only a small profit was made by such a system, it would be more than zero direct profit obtained by the current system.

A system like this would also have the advantage (to both the producer and consumer) that older material that the producer no longer wanted to host could still be available (possibly for free or at greatly reduced cost) by it being seeded from consumers' machines. A case of this is highlighted below.

A Case Study; Doctor Who

As a case study, the classic BBC series "Doctor Who"^[165] consists of over 150 stories, (most with at least 4 parts); this represents 300 hours (a very rough estimate) of footage. While several episodes are available on VHS or DVD, due to the limited market, it would seem economically unsound for the BBC to invest the time and resources in publishing the entire collection in a physical medium (including reconstructing "missing" episodes - many of which were destroyed by the BBC due to excessive costs demanded by the television producers due to fears that keeping the footage would destroy their industry). Even if the collection was gathered in a digital format, it would likely amount to several hundred gigabytes of data; and so the cost of hosting that file would be disproportionate to the gain. This would seem to be a great loss for British culture. However, certain fans have collated the episodes, including reconstructions of the missing episodes, and have hosted them (illegally, of course) on P2P networks. Due to the size and popularity, the complete files could, potentially, take years to download fully, but it would similarly take years to watch. While we should not encourage illegal behaviour, if the BBC were to authorise such distribution, it would help preserve and distribute a significant portion of British culture and, by relying on fans to gather the collections and seed the files, would have virtually no cost to the BBC. In many cases, the material is not available legally and so the BBC has nothing to lose by the distribution and if, for example, they set up their own tracker/file-indexing service and charged users small amounts to use it, they could easily make some profit from the material.

Conclusion

Due to the ease of use, it is not surprising that new musicians are increasingly using P2P networks to distribute their music for free.^[166] While this may seem to be a rather sketchy business model, a 2006 study found that among the 35 top-earning musicians, 73% of their income came from concert sales with less than 10% coming from recordings.^[167] P2P file-sharing offers a virtually free way of distributing music to millions of consumers and thus gaining publicity which can be turned into concert sales. It may not be long before we begin seeing amateur or independent films being released this way, with producers possibly relying on merchandise (T-shirts, signed material) and eventual DVD or cinema sales to turn a profit.

It is not artists who lose from illegal P2P file-sharing^[168], or society^[169] or consumers. So who is losing out? P2P technology can be seen as competing with the big record labels themselves - by offering distribution channels, publicity etc. - the very businesses who seem to be pushing so hard to legislate against this. A coincidence?

Unfortunately, over the past few years, the content industry (specifically the Record labels) have done their best to demonise P2P file-sharing, often ensuring that any contracts prevent their signed artists from releasing any of their content this way. As such, it may take some more convincing before P2P is openly embraced.

Appendix B: Glossary

• BitTorrent - A P2P protocol accounting for 27-55% of global internet traffic. Also the company that created the protocol and the original client for it.
• Client (P2P) - Software used by a user to connect to a P2P network and manage downloads and uploads.
• Content creator - The individual (or group) responsible for writing, composing or producing material. Not to be confused with the 'rights holder'.
• Data - Information; in this case, specifically encoded in a binary/digital form (i.e. a binary number).
• Digital Rights Management (DRM) - Software or Technology designed to place limitations on the usage of digital content.
• File - A collection of data identified by a name.
• File-sharing - The distribution of files (whether legally or otherwise) between individuals, computers, servers or similar devices.
• Peer (P2P) - A user or machine that is forming part of a P2P network, either through uploading or downloading the file.
• P2P (Peer-to-peer) - A method of distributing data by connecting directly from one user to another.
• Piece (BitTorrent) - Files transferred using the BitTorrent protocol are split into a number of identically sized pieces, usually between 64kB and 4MB which are downloaded separately (typically in order of rarity) from other peers and then collated by the user.
• Rights holder - An individual or corporate entity that holds the legal copyright on certain material. Not to be confused with the 'content creator'.
• Seed - A P2P user who is exclusively uploading, having downloaded the entire file.
• Tracker (BitTorrent) - A server that aids file-sharing using the BitTorrent protocol by helping communication between peers.

Appendix C: Spore

Spore is a computer game developed by Maxis and published by Electronic Arts (EA) in September 2008.^[170] Within three weeks it had sold nearly 2 million copies. The controversy surrounding the game began several months before the release when EA announced that they would be including DRM technology supplied by SecuRom with their games.^[171] This software

[caused] controversy due to an online verification system connected to its CD key. The system requires a connection to the Internet during installation to check (that) the CD key is valid, and then registers the key with the users' computer. After this the game will try to re-check the CD key every 5-10 days to ensure it hasn't since been found posted on a forum, or used in some form of piracy. If the game can't verify the key within this period it will continue to try for a further 10 days, after which it will stop working until the key is checked. The protection will also only allow the game to be installed three times.^[172]

This technology is seen as intrusive, inconvenient and appears to treat normal users as potential pirates, "checking up" on them every 10 days. Also, concerns were (and are - the software still exists) over the use on computers not regularly connected to the internet and how resale would work. The limit to three installations also would potentially cause issues for anyone who upgraded their computer in any way. SecuRom software had already raised controversy over claims that it was (and still is) not removed upon the uninstallation of the game it was included with (and it is particularly hard to remove still, despite the company releasing a "Removal Tool" for it^[173] and that it acted as a rootkit.^[174] As a result of the controversy over this there were calls for a boycott of the game, despite it being widely anticipated and having gained significant following since its initial demonstration. Up to and after the release several news organisations^[175] reported on the controversy including the mass protest that took place on Amazon (both .com and .co.uk) with thousands of reviewers giving the game the lowest rating and warning potential buyers away (Spore currently has an average of 1.5/5 stars on Amazon.com^[176]). Within two weeks of the release EA had announced that they would lessen the restrictions (increasing the number of installs the game was limited to from 3 to 5 and offer an easier way to obtain more)^[177] but claimed that "that DRM policy is essential to the economic structure [they] use to fund [their] games". They allegedly did not think that the restriction would cause a problem as "less than 1 percent of its users relied on three or more computers", although this was after announcing over 400,000 activations of the game.^[178] A former Maxis employer summarised how badly EA and handled the situation:

Firstly, SecuROM didn't even work, as the game was pirated before release. ... Also, they have thrown away a lot of the goodwill that gamers have towards Will Wright. I understand why they think the DRM is a good idea, but they haven't even tried to make it 'good' DRM, by defending their position, making it clear when and if the DRM will be removed, or abandoning it the day it got pirated. "From a PR point of view, this is a disaster, as they have come across like they have their fingers in their ears and aren't listening. Ultimately I think it's sad, because this was a very original, high budget PC game release that could have been a great shot in the arm for PC gaming. Everyone loses as a result of this, EA, Maxis, and PC gamers. ... It's a totally avoidable disaster.^[179]

The inclusion of the DRM software (and the fact that it "was not mentioned on the box, in the manual, or in the Software license agreement"^[180]) led to lawsuits being filed both for the main game^[181] and the free demo.^[182] As a form of protest there was a call around certain communities to 'pirate' the game, partly to prove that the controversial DRM was ineffective and the fact that it was downloaded so many times would demonstrate this to be the case. Many users also downloaded an illegal copy after buying the game, so that they could install a version without the SecuRom software. There were also cases of people downloading the game and not playing it. One commentator summed up the situation quite nicely;

There is a lesson here for all media companies. Whether they are producing videogames, movies, or music, adding DRM won't stop piracy. The best way to stop piracy is to hobble the pirated version, not the official one.^[183]

On a personal note, as a result of previous unpleasant experiences with SecuRom restrictions (resulting in having to consult technical support for one game) and despite following the game with great interest since its original announcement, the author decided against purchasing the game (and several subsequent games published by EA containing similar SecuRom software including Mass Effect, Command & Conquer 3: Kane's Wrath and Red Alert 3 - although with some of these titles now available without the SecuRom software through Steam^[184] they are again being considered). Instead he purchased a game published by a company that refused to include DRM on its products. He did not attempt to obtain a pirated version of any of these.

Due to this controversy, using it as an example of how the video games industry has suffered as a result of P2P file-sharing is questionable at best. Quoting a one game developer;

Blaming piracy is easy. But it hides other underlying causes. When Sins [of a Solar Empire] popped up as the #1 best selling game at retail a couple weeks ago, a game that has no copy protect whatsoever, that should tell you that piracy is not the primary issue.^[185]

In June 2009 EA announced that it would drop all DRM from subsequent games, instead thinking of games as offering services and "making the service so valuable that in comparison the packaged good [the actual software, capable of being pirated] is not."^[186] This is a good example of a content producer developing a new business model under pressure from consumers, rather than trying to add more restrictions or legislate. It is possible that the content industry could learn something from this.

Appendix D: Network Neutrality

Net Neutrality is the guiding principle that preserves the free and open Internet.^[187]

It is the principle that internet users should have control over what content, services and applications they can access through the internet. The creator of the internet described it in the following way:

If I pay to connect to the Net with a certain quality of service, and you pay to connect with that or greater quality of service, then we can communicate at that level. ^[188]

In a truly neutral network all traffic is treated equally no matter what the content, source, destination or protocol used is.

An example of a neutral network is the national electric grid; the grid does not care what the electricity is used for, or who is using it (provided it has been paid for). Because of this, the grid "has survived and supported giant waves of innovation in the appliance market."^[189] The grid functions in a the same way now, powering MP3 players and surround-sound music systems, as it did when it was created in the 1930s, powering the early radios. A similar principle applies with the telephone network; Once connected, the network operates regardless content of the conversation or the parties involved (assuming they have a high enough quality of service as described above). Another example is the postal service; while the Royal Mail has certain conditions on what it will deliver for safety reasons^[190] will offer the same service (upon appropriate payment) regardless of the sender, recipient or content.

Net neutrality ensures that service providers (in this case, ISPs) cannot discriminate against certain consumer groups or businesses. With It is arguably "the reason the Internet has driven economic innovation, democratic participation and free speech online." Once this neutrality is lost, it gives the service providers the option of discriminating between traffic at their whim. This power could be used to control information by restricting access to sites that have content the ISP finds undesirable (for example, criticism of their service or information on competition). This could be done either by blocking or redirecting (the latter of which the author has already observed, with mistyped URLs being redirected to a page operated by his ISP rather than returning an error^[191] - the ISP has also admitted that generates revenue from this redirecting) and can be particularly dangerous as it can be done in a way so that the effect is not obvious (without consulting someone on a different service). In 2006 the internet service provider AOL was accused of blocking emails sent through its system containing a link to one of their opponents' websites, although they later claimed this was due to a software "glitch".^[192] As an example of the possibilities of port blocking, in 2004 a small US telecom company blocked some of their internet customers from accessing a VoIP service that could potentially compete with part of their own service. As a result, they were fined $15,000.^[193] Allowing content or port filtering would also enable ISPs "to discriminate in favor of their own search engines, Internet phone services and streaming video - while slowing down or blocking services offered by their competitors."^[194]

Such traffic filtering is not limited to commercial 'abuse'. For many years the Chinese government has been notorious for blocking or redirecting access to materials for political reasons, being placed in the highest category for political filtering by the OpenNet Initiative^[195] and is included in Reporters Without Borders's (RSF) list of 13 "internet enemies".^[196]

Despite the possible benefits of being able to manipulate consumers' traffic at whim there are advantages of Net Neutrality for ISPs, most specifically, surrounding the concept of a "safe harbour". In the United States, this principle was introduced in 1998 as part of the Digital Millenium Copyright Act (DMCA) and provides ISPs (and similar organisations) with legal immunity for any traffic that passes through their network and the request of users provided that it is handled automatically and not modified.^[197] Similar to the idea that a water, electricity or telephone company should not be held liable for crimes committed using their service (i.e. if electricity is used in a crime, or it is organised over a 'phone), this provision protects the ISP from being held responsible for anything that occurs on their network. However, once the ISP starts filtering some content, it could be argued that they are accepting some responsibility for their traffic and could potentially be held liable for any illegal traffic on their system (as they did not filter it). This could have quite serious implications for ISPs as if they claimed to block access to some illegal sites (i.e. P2P network indexes), they could face accusations of aiding copyright infringement for any that they failed to block.

Disclaimer: The author has no legal training or experience and all of this final paragraph should be treated as opinion.

In summary, allowing ISPs (or the government) to interfere with internet traffic (either by blocking/redirecting certain sites, IPs, ports or protocols) could be lead to legal and ethical complications.

Notes

1. ↑ The Pirate Party UK
2. ↑ Wikipedia
3. ↑ British Phonographic Industry - Wikipedia
4. ↑ RIAA - Wikipedia
5. ↑ Warner Music Group
6. ↑ UMG, through their parent company Vivendi
7. ↑ EMI, owned by Terra Firma Capital Partners
8. ↑ File-Sharing and Copyright, Oberholzer-Gee & Strumpf (2009)
9. ↑ Section 3.6 of the Consultation document
10. ↑ 14-24 Year Olds Pirate 8,000 Music Tracks Each
11. ↑ Amazon.co.uk appears to offer tracks for approximately 75p, Play.com; 65p
12. ↑ Are downloads really killing the music industry? Or is it something else?
13. ↑ UK games market worth GBP 4 billion - but what does that mean?
14. ↑ http://www.ipsos-mori.com/DownloadPublication/1292_MediaCT_thoughtpiece_Digital_Film_Aug09_WEB.pdf
15. ↑ Recording Industry Now Making Up Facts...
16. ↑ Music piracy costs money; does fighting it cost more?
17. ↑ Study: File sharing boosts music sales, Music sharing doesn't kill CD sales, study says, Study: File-Sharing No Threat to Music Sales, Downloading 'myths' challenged, A Heretical View of File Sharing, Music File Sharers Spend The Most
18. ↑ Gov't Commissioned Study Finds P2P Downloaders Buy More Music
19. ↑ Pirates are prime prospects for music and video (2009)
20. ↑ Section 3.13 of the Consultation document
21. ↑ Section 3.10 of the Consultation document
22. ↑ How Open Source Software Can Save the ICT Industry One Trillion Dollars per Year
23. ↑ Spore is a special case due to the unusual controversy it created and as such is covered separately in Appendix C.
24. ↑ The Sims 2 - Wikipedia
25. ↑ TheSims2.com - 100 Million Sold
26. ↑ The Sims 2 - RRP £29.99, current price £13.99
27. ↑ Assassin's Creed - Wikipedia
28. ↑ Assassin's Creed - Amazon.co.uk; RRP £34.99, used from £4.49
29. ↑ DRM - Digital Rights Management; see Appendix C
30. ↑ Electronic Arts; EULA Agreements and DRM - Wikipedia
31. ↑ Such as Valve's Steam, IGN's Direct2Drive, Stardock's Impulse or EA's Direct Download service.
32. ↑ Section 3.14 of the Consultation document
33. ↑ BBC - Goodbye "Knock-off Nigel"
34. ↑ MAFIAA - Wiktionary
35. ↑ RIAA Radar - a search engine for telling if an album is covered by the RIAA.
36. ↑ iTunes Store; Digital rights management - Wikipedia
37. ↑ EA's new motto: please pirate our games... er, storefronts
38. ↑ Steam - Wikipedia
39. ↑ DICE 2009 Keynote - Gabe Newell, Valve Software - 6.51pm onwards)
40. ↑ DICE 2009 Keynote - Gabe Newell, Valve Software - 6.19pm)
41. ↑ YouTube Blog: YouTube, the UK and the Performing Rights Society for Music
42. ↑ Harmony restored as YouTube deal with PRS ends video dispute
43. ↑ See Appendix A
44. ↑ iPlayer; Download Service - Wikipedia
45. ↑ Channel 4; 4oD - Wikipedia
46. ↑ Sky Anytime - Wikipedia
47. ↑ The Pirate Party UK
48. ↑ PirateParty.org.uk: The Price of Justice
49. ↑ HADOPI Law Passed – by 12 Votes to 4
50. ↑ Napster; Shutdown - Wikipedia
51. ↑ The Pirate Bay Trial - Wikipedia
52. ↑ Eircom - Wikipedia
53. ↑ Copyright (New Technologies) Amendment Act 2008
54. ↑ Key: We still need a new internet copyright law
55. ↑ Copyright (New Technologies) Amendment Act 2008 - Wikipedia
56. ↑ Seven million 'use illegal files'
57. ↑ At this point, the distinction between "Rights holder" and "content creator" should be noted.
58. ↑ Network Neutrality - a good introduction
59. ↑ The internet is effectively a network for distributing information.
60. ↑ Convention for the Protection of Human Rights and Fundamental Freedoms as amended by Protocol No. 11
61. ↑ Virgin Media CEO attacks net neutrality
62. ↑ Virgin Media mops up CEO's 'boll*cks' outburst
63. ↑ Digital Millennium Copyright Act; Title II: Online Copyright Infringement Liability Limitation Act - Wikipedia
64. ↑ About the Internet Watch Foundation
65. ↑ IWF URL list recipients
66. ↑ Internet Watch Foundation; Criticism - Wikipedia
67. ↑ Wolverine filetype:torrent - Google Search
68. ↑ The Pirate Bay
69. ↑ Wireless TPB
70. ↑ The website does not host any actual "content", merely lists of users who have such content - see Appendix A.
71. ↑ Tor: Anonymity online
72. ↑ ipredator
73. ↑ IPred; Criticism - Wikipedia
74. ↑ The Draft IP Enforcement Directive - A Threat to Competition and to Liberty
75. ↑ http://farm1.static.flickr.com/24/43991064_08dcc81a02_o.jpg
76. ↑ Open Rights Group
77. ↑ Pirate Party UK
78. ↑ How Mandelson's sudden urge to stop net piracy came after a meal with the rich and powerful
79. ↑ For example, a TV series may contain 5 or 6 DVDs, which is inconvenient to store/transport/use, whereas downloaded files of the same content at acceptable quality can fit on modern USB flash drives and can be quickly accessed.
80. ↑ "60 Minutes" on Video Piracy - 1979 - part 1 of 2, "60 Minutes" on Video Piracy - 1979 - part 2 of 2 - Note, these films appear to be taped from the TV, ironically, and under the current copyright law, may be illegal.
81. ↑ Davenport Lyons
82. ↑ Davenport Lyons - Techdirt
83. ↑ Davenport Lyons - threatening letters - Watchdog
84. ↑ Which? makes formal "bullying" complaint about Davenport Lyons
85. ↑ The one case that happened and was hailed as a victory for the industry emerged to be a default judgement as the defendant could not be found UK Game Piracy: Propaganda, Evidence and Damages All the cases that made it to court were default judgements.
86. ↑ TorrentFreak
87. ↑ Section 4.14 of the Consultation document
88. ↑ If the cases are not permitted to go to a full trial, it would suggest that the justice system is being bypassed for the sake of the commercial interests of organisations.
89. ↑ Antipiracy group's tactics violate Swiss law
90. ↑ Anti-Piracy Company Illegally Spied on P2P Users
91. ↑ Are The RIAA's Investigation Techniques Illegal?, In the Fight Over Piracy, a Rare Stand for Privacy
92. ↑ Business as usual as MediaSentry ignores Michigan complaints
93. ↑ MPAA accuses laser printer of illegal file sharing
94. ↑ Tracking the Trackers - Investigating P2P copyright enforcement
95. ↑ It has been seen as such in other communities for some time.
96. ↑ For example, assuming 7 million infringers, the cost of merely sending letters could be as high as £2m (Second Class mail - Royal Mail).
97. ↑ Part II - Retention of Communications Data
98. ↑ Data Protection Act 1998
99. ↑ Section 4.23 of the Consultation document
100. ↑ How the Old Napster Worked
101. ↑ Section 4.27 of the Consultation document
102. ↑ Section 4.28 of the Consultation document
103. ↑ A History of Magnetic Audio Tape
104. ↑ International Copyright Relations (235) When Gilbert and Sullivan attacked the 'Pirates.'
105. ↑ Davenport Lyons - threatening letters - BBC Watchdog
106. ↑ Why most artists profit from piracy
107. ↑ Harvard Study Finds Weaker Copyright Protection Has Benefited Society
108. ↑ It's not a crime to download, say musicians
109. ↑ Big labels or Google - who is the songwriters' worst enemy?
110. ↑ piracy is a crime - YouTube
111. ↑ Oxford v. Moss - Wikipedia
112. ↑ Note: The author is not a legal expert so his interpretation of this ruling may be incorrect.
113. ↑ UK gets its own official Pirate Party
114. ↑ TV links - Wikipedia
115. ↑ The Inside Story of the TV-Links Bust
116. ↑ TV-Links man was arrested under trademark laws
117. ↑ Are Copyright Holders Purposely Putting Content On P2P In Order To Demand Money?
118. ↑ Note: The author has had no technical training or education in this area, so this is supposition.
119. ↑ MPAA accuses laser printer of illegal file sharing
120. ↑ IP Spoofing: An Introduction
121. ↑ Illegal number - Wikipedia
122. ↑ What is BitTorrent?
123. ↑ Annex D, page 35, paragraph 3 of the Consultation document
124. ↑ FBI called in over Wolverine leak
125. ↑ 'Wolverine' Rages on First Day
126. ↑ 'Wolverine' wolfs down nearly $5 mil
127. ↑ Wolverine (film); Theatrical run - Wikipedia
128. ↑ All-Time Worldwide Box office
129. ↑ X-Men Origins: Wolverine (2009
130. ↑ X-Men Origins: Wolverine
131. ↑ No Line on the Horizon; Charts and certifications - Wikipedia
132. ↑ U2 Debuts At No. 1 In 14 Euro Territories
133. ↑ U2 Expanding 'Unforgettable Fire' This Fall
134. ↑ Annex D, page 35, paragraph 5 of the Consultation document
135. ↑ Digital Music Report 2007 - Page 18
136. ↑ The Pirate Bay Trial - Wikipedia
137. ↑ Should The Pirate Bay thank MPAA for its cult following?
138. ↑ Pirate Party Wins and Enters The European Parliament
139. ↑ Provisional result of the Election to the German Bundestag 2009
140. ↑ Misuse of statistics - Wikipedia
141. ↑ Annex D, page 35, paragraph 6 of the Consultation document
142. ↑ Which? makes formal "bullying" complaint about Davenport Lyons
143. ↑ UK Game Piracy: Propaganda, Evidence and Damages
144. ↑ Valve Software
145. ↑ Sony Pictures CEO hates the Internet
146. ↑ Who is the songwriters' worst enemy?
147. ↑ Why Most Artists Profit from Piracy
148. ↑ Harvard Study Finds Weaker Copyright Protection Has Benefited Society
149. ↑ Featured Artists Coalition
150. ↑ It's not a crime to download, say musicians
151. ↑ Piracy & PC gaming
152. ↑ Artists See a Future With BitTorrent
153. ↑ YouTube
154. ↑ flickr
155. ↑ MegaUpload
156. ↑ Slashdot effect - Wikipedia
157. ↑ Traffic management - Virgin Media
158. ↑ For example the last episode of season 5 of the TV series "House" was broadcast in the UK on Sky1 in late September 2009, with the season having not yet started on 'terrestrial' television, and yet the first episode of season 6 has already been broadcast in the US and so is widely available on P2P networks
159. ↑ The final two seasons of the TV series Stargate SG-1 were not broadcast on terrestrial television in the UK, despite the previous 8 being and the series Alias as stopped mid-season
160. ↑ Particularly among international fan communities; where there is a risk of accidentally hearing "spoilers" for an episode over a year before it is legally possible to view it.
161. ↑ Hard disk drive; Form factors - Wikipedia
162. ↑ Keep case; Physical dimensions - Wikipedia
163. ↑ Valve discovered that having large reductions in price for short periods led to drastically increased sales: DICE 2009 Keynote - Gabe Newell, Valve Software
164. ↑ What is Steam?
165. ↑ Doctor Who - The Classic Series
166. ↑ Artists See a Future With BitTorrent
167. ↑ File-Sharing and Copyright (2009) - Table 6
168. ↑ Why Most Artists Profit from Piracy
169. ↑ Harvard Study Finds Weaker Copyright Protection Has Benefited Society
170. ↑ Spore Available at Retailers Worldwide This Week
171. ↑ Report: Gamers angry at DRM system from EA
172. ↑ EA To Use Controversial Internet-Required DRM On New Games
173. ↑ SecuROM Removal Tool Information
174. ↑ Software designed to hide or obscure the fact that it has been installed. Spore Seeds Rootkit
175. ↑ The Spore DRM revolution at Amazon.com, Copyright row dogs Spore release, Spore hit by DRM protest, Why Spore won't work
176. ↑ Spore - Amazon.com
177. ↑ EA retools 'Spore' DRM activation features
178. ↑ EA Admits Spore Launch Botched by DRM; Still, Financial Damage Already Done
179. ↑ Former Maxis Man: Spore DRM is a Screw Up
180. ↑ Spore; Controversy - Wikipedia
181. ↑ EA Hit with Class Action Lawsuit over Spore DRM
182. ↑ Eldridge v. Electronic Arts, Inc.
183. ↑ Spore And The Great DRM Backlash
184. ↑ EA Launches with 10% off all Games in the UK
185. ↑ Piracy & PC Gaming
186. ↑ EA's new motto: please pirate our games
187. ↑ What is Net Neutrality - Save the Internet
188. ↑ Net Neutrality: This is serious
189. ↑ Network Neutrality FAQ
190. ↑ Royal Mail general terms and conditions
191. ↑ Advanced Network Error Search
192. ↑ AOL charged with blocking opponents' e-mail
193. ↑ In the matter of Madison River Communications, LLC and affiliated companies - Federal Communications Commission
194. ↑ Who wants to get rid of Net Neutrality? - Save the Internet
195. ↑ China - OpenNet Initiative
196. ↑ List of the 13 Internet enemies
197. ↑ Online Copyright Infringement Liability Limitation Act - Wikipedia