The Digital Economy Act was the brainchild of Lord Mandelson during the last Labour government. It was rushed into law via the controversial ‘wash-up’ process at the end of that parliament – meaning it received very little parliamentary debate. It has remained a controversial Act ever since.
The Act includes a controversial ‘3 strikes’ provision, but has required guidance from Ofcom before it can be brought into force. Ofcom’s draft code for consultation was published last month, just before the European Parliament rejected ACTA and its own graduated response provisions. “If a customer receives three letters or more within a 12-month period”, says Ofcom, “anonymous information may be provided on request to copyright owners showing them which infringement reports are linked to that customer’s account. The copyright owner may then seek a court order requiring the ISP to reveal the identity of the customer.”
DEA contains further provisions that could “require ISPs to take steps (such as internet bandwidth reduction, blocking internet access or temporarily suspending accounts) against relevant subscribers in certain circumstances”, says Ofcom. Its announcement starts, “Internet users will be encouraged to download music and films through legal channels under measures outlined today by Ofcom,” prompting Jim Killock, Chief Executive of the Open Rights Group to suggest “Ofcom are being asked to put lipstick on a pig with this code.” Darren Farnden, head of marketing at Entanet, agrees with Killock: “Pursuing people through the courts based on shaky IP address information and then threatening them with warning letters and disconnection is not the way to tackle this issue.”
Ofcom’s own timetable indicates that DEA measures will not start until at least 2014. It is this that prompts Entanet to suggest it can no longer be effective. “With so much notice,” says Farnden, “surely the most prolific infringers will have discovered even more ways to circumvent the DEA by the time it’s enforced.” In particular he points to the use of VPNs and proxies. “The most commonly talked about circumvention techniques are the use of proxies or VPNs. Research by the Cybernorms research group at the Lund University in Sweden revealed a 40% rise in the use of VPN systems by the 15 to 25 year age group since 2009 in Sweden, surely proof that such circumvention is already being implemented.”
Farnden points to a contradictory healthy growth in legal online music sales. He quotes the 2012 IFPI Digital Music Report, which states: “Many major markets are seeing healthy increases in single track download sales, including the US, up 10 per cent (Nielsen SoundScan); the UK, up 8 per cent (Official Charts Company/BPI) in 2011; and France up 23 per cent (GfK). Consumer demand for iTunes, the market leader, is growing healthily.” This prompts Farnden to conclude that “Entertainment companies need to reassess their business models to take advantage of the opportunities the Internet brings, not fight them.”