Original URL: http://www.theregister.co.uk/2010/01/22/mandybill_file_sharing_payoff/

Lords mull Hail Mary penance for file sharers

Peers discuss costs, ambulance chasing

By Andrew Orlowski

Posted in Media, 22nd January 2010 11:04 GMT

Mandybill The Lords this week discussed new compensation for copyright holders this week - including a voluntary 'Hail Mary fine' payable by file sharers, instead of suspension - but nobody noticed.

It was late on Wednesday night, and the Lords were six hours into their fourth session this month discussing the Digital Economy bill. Lord Lucas moved Amendment 156, giving an infringer a choice:

[It] requires the payment of an additional fee by the subscriber for the maintenance of unrestricted internet access, which is to be remitted to a licensing body established under the Copyright, Designs and Patents Act 1988.

Lucas said he anticipated a more progressive licensing regime, similar to the performance right on compositions, which is non-exclusive:

"No one stops a person performing, but if they do perform, they have to pay a fee," he said. "Given the fact that someone is having a technical obligation imposed on them, it seems that they might choose to pay a fee to such an agency, which would go to relevant copyright holders. Terminating, suspending or limiting someone's internet access just does someone harm."

The Amendment won the backing of a couple of peers. Earl Erroll said it was sensible to keep copyright infringement under a civil offence, not a criminal one.

"It is a very positive, sensible and forward-thinking way of dealing with the situation without terminating a lot of people's internet service. If they are caught red-handed, let them voluntarily - with a little bit of persuasion - provide a remedy to the people harmed," he said.

'Voluntary with persuasion' is reminiscent of the Krays - and when a similar idea was floated in 2008, it was described as a music business extortion racket. But peers who'd spent hours castigating copyright holders for extortion didn't quite see it that way.

Baronness Howe and Lord Whitty also commended it, or in Whitty's case, something similar. Lord Young for the government described it as a product of Lucas' "fertile imagination". Someone facing suspension shouldn't be able to say a quick penance and pay for the problem to go away, he said.

"We are not talking about an ingénue or innocent who has stumbled across the content. We are talking about someone who has had repeated attempts to help them. We have sent them one, two or possibly three letters, but they have continued committing the same offence. The amendment says, 'That's okay. You can continue to download illegally, but just pay a fine'. This goes against the whole purpose of what we are trying to do."

Young also said it would also harm the market:

"The unintended consequence of this is that it has the potential to be quite an unhelpful intervention in the market for legal content offerings. That is what we have all said that we are trying to encourage."

Lucas is a self-styled libertarian, so he must realise the inherent contradiction of the state acting in this way. He withdrew the amendment, but hoped it would point the way to more progressive licensing:

"I was not suggesting that the amendment is a permission to continue downloading any more than limiting someone's internet access is a permission to continue downloading. It is, as it were, a compensation for past sins, which you can pay for either by not being able to access the internet properly or by making a contribution," he said.

"I suspect that I have concluded that the right way for copyright to move on the internet is towards the pattern used for sheet music - a matter not of control but of payment. This is reflected in what the Government propose in Clause 42, where they are clearly anticipating that kind of move to the point where the important thing is that the copyright holder gets paid, not that the copyright holder absolutely controls the timing and means by which the copyright material is acquired," he added.

The key obstacle to better music services is just that: the master rights holder's 'exclusive right to make a copy of a sound recording' is what blocks legitimate P2P services.

It's a fascinating debate that goes to the heart of what emphasis on policy should be: encouraging new services, or punishing infringers. Mandelson has said the two go hand-in-hand, but new services are conspicuous by their absence.

Lucas had earlier reminded the House that, "more money for copyright holders is the goal - not reducing file sharing for its own sake."

Whitty agreed, saying "It is not sensible to use sanctions simply to reduce the traffic. The aim must be that the majority of the market uses legal means of downloading, uploading and file-sharing."

You'd think P2P and internet suspensions were a burning consumer issue - they never fail to set the mailbox and comments alight here - but the apathy about the new legislation here is overwhelming. Nobody has reported the last two Lords sessions, and even the Open Rights Group - which bills itself as a "consumer" outfit rather than an anti-copyright campaign - hasn't made a blog post on the subject since January 6. (The counterpart US anti-copyright outfits dispatch two or three notices a day). So for the record, there were some interesting points raised this week.

Costs and ratchets

One was whether the file sharing detection breached RIPA. The Earl of Erroll thought it might be Phorm-like. Young said it would have to be consistent with RIPA, the Regulation of Investigatory Powers Act, "so anything that would not be possible under those Acts will equally not be possible as a result of the Bill."

There has been lots of discussion by the Lords of copyright shakedowns, with ACS Law sending menacing demands but refusing to allow the accused to go to court. You may recall Davenport Lyons ended the practice in 2008, but ACS continued.

For the Government, Young said he doubted the scale of the problem - nobody had complained - and perhaps even the sincerity of the LibDem Clement Jones in pursuing the case - since Clement Jones hadn't even advised anyone to complain.

The thorny issue of costs hasn't been addressed without being resolved. The government had said that 75 per cent should be borne by the rightsholder and 25 per cent by the ISP, based on costs. It now justifies that figure on rewards rather than costs.

Clement Jones said he was happy with the initial proportion, but noted mobile operators were wary of rightsholders increasing the burden later on. Rightsholders had proposed a 50:50 split.

Damages is another issue. Some infringements are far more costly than others, Lucas pointed out:

"A pre-release film, for example, would cause a very different amount of damage from a number of relatively old music singles."

Lord Howard of Rising was wary of copyright holders clubbing together to form blacklists of suspects who had evaded them. Young warned them that a rightsholder couldn't obtain an alleged infringers identity without going to court. There could be no technical measures before an appeal.

Overall Lucas summed up the criticism of the Bill when he described a ratcheting process: "...a cumulative effect - all kinds of little ways in which Ofcom will not set out to help the consumer and all kinds of little ways in which someone accused under the Bill will find their life made difficult and tiresome, with a great deal of effort and uncertainty imposed on them in dealing with the allegation. Although each little piece of the argument has its own logic, as a whole it paints an uncomfortable picture, which is tilted too far towards the copyright owner rather than the citizen."

Nevertheless, the Lords have dealt with the copyright portions now, and aside from some procedural additions, these remain intact. Two more committee stages are scheduled for the Lords before it lands in the Commons. ®