As the campaign initiated by the RIAA in the United States seemed to show, suing file-sharers does little to reduce online piracy. The swapping of files online continued unabated throughout the last decade of litigation, prompting a new strategy from the international music and movie industries – trying to hold ISPs responsible for the activities of their subscribers.

However, under the AFACT umbrella, Hollywood lost its most prominent case against ISP iiNet after the court decided that the ISP was not responsible for the infringements of its subscribers.

Despite being ordered to pay all costs, AFACT announced it would not only go back to court in an attempt to avoid paying them, it would also appeal the entire decision, claiming that the judge was wrong on just about every point.

This stubborn attitude hasn’t gone down well, with many observers openly criticizing Hollywood’s bullish stance and insisting it should accept defeat graciously. But of course, that’s not going to happen. After all, what could they do having failed to force ISPs to carry the can? Start suing file-sharers RIAA-style?

Worryingly, an AFACT spokeswoman quoted in a News.com.au article this morning (which has since inexplicably disappeared), said the anti-piracy group now has that armageddon option under consideration. She claimed they are yet to make a final decision.

In the meantime it’s back to the old FUD strategy to try and scare people away from file-sharing networks.

“If you’re using (torrents) (we) can see every movie you want, everyone who is sharing it and everyone who has it on their hard drive,” said the AFACT spokeswoman. “It’s very public what you do and as copyright holders we have a third-party company that is mining all that information and sending it to Internet Service Providers,” she added.

Well that’s not going to scare iiNet customers very much is it?

Nevertheless, AFACT claims there are a number of things ISPs can do to stop piracy, including banning access to torrent sites. Thing is, generally they aren’t, and with this latest iiNet decision there is even less incentive for ISPs to send out warnings or even temporarily suspend accounts, as shown by Exetel which recently reversed its policy.

But there are other ways to encourage reductions in piracy. You don’t have to sue ISPs, spread FUD or imply that suing end users is an option under consideration. Instead of being aggressive towards customers, why not try to pull them onside?

The Intellectual Property Awareness Foundation (IPAF) was created to “promote the value of the industry by raising awareness, understanding and appreciation of intellectual property, and its role and value in society.” In other words, this is a more outwardly friendly anti-piracy group that aims to educate and persuade rather than deal the traditional death-by-lawyer.

Today IPAF announced the appointment of a new CEO, ex-Sony and Fox director Gail Grant who will lead the organization “to motivate a change in public attitude away from piracy” and “encourage supporting the more than 50,000 people employed in all aspects of the industry through the enjoyment of original and legitimate film and television experiences.”

Fair enough. Persuading the public is certainly better than beating them into submission. But there is a problem. While IPAF plays softly-softly with its consumer friendly image, its main sponsors are doing completely the opposite. In case you’re wondering, those sponsors are AFACT and the MPA.

As earlier pointed out by iiNet chief Michael Malone and countless others, the best way to combat piracy is to make movie and TV content available online readily and cheaply. Maybe the studios could get together and create a new group with a CEO dedicated to that, instead of spending money on all of these other good-cop/bad-cop groups with conflicting messages.

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After endless negotiations between the copyright industries and Internet service providers which ultimately led nowhere, Spain’s Ministry of Culture has decided to take action to break the impasse.

The new Sustainable Economy Law, sponsored by President José Luis Rodríguez Zapatero, includes draft amendments to legislation “to protect intellectual property against piracy on the Internet”.

The proposals will add to the country’s current ‘information society services’ legislation. Article 8.1 already allows for restricting access to the Internet on several grounds – protecting public order, a criminal investigation, national security, protection of public health, protecting personal dignity, anti-discrimination and the protection of children.

It is proposed that new grounds for disconnection will be added to “safeguard intellectual property rights”. This will hand “competent bodies” the authority to require Internet service providers to supply information on customers who are deemed to be breaching copyright.

El Pais reports that there will not be an emphasis on disconnecting individual Internet users, but instead the focus will be on sites providing links to copyright works, of which there are several hundred in Spain.

In a statement, Spain’s Minister for Culture, Ángeles González-Sinde, said that sites offering links to copyright works could be taken offline without a judicial order, an announcement which has met with firm opposition from activists.

While González-Sinde denied yesterday that individual Internet users could have their connections disconnected, there are conflicting reports that the government could add a further amendment to the Sustainable Economy Law to allow for such disconnections under the supervision of a court.

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The copyright infringement case of AFACT – representing several Hollywood studios – and Aussie ISP iiNet (multiple links to all our earlier coverage can be found here, here, here, here and here) is set to conclude today.

Lead barrister for AFACT, Tony Bannon, continued with his aggressive approach to this case by issuing warnings to Australia’s Internet service providers on the issue of copyright infringement.

He said that iiNet and other ISPs who don’t want to handle copyright infringement notices (such as those issued by his clients) are happy to take money from their subscribers, but are shirking their responsibilities. The solution to this, he said, was for them to shut down.

“They [ISPs] provide a facility that is able to be used for copyright infringement purposes. If they don’t like having to deal with copyright notices then they should get out of the business,” he said, as quoted by ITNews.

This reluctance to deal with infringement notices at the behest of the studios has been one of the main points of contention in the case. The studios feel that iiNet should hand infringement notices to their customers and even disconnect them, while iiNet feels that it has no obligation to do so under the law, particularly when acting on the unverified evidence of a 3rd party.

Bannon went on to say that iiNet had made zero effort to deal with even a small percentage of the alleged infringements on their network, commenting: “…they say they can’t send a single notice to anybody, it’s like saying they can’t stop physical violence happening to the person next to them because there’s physical violence happening all around the world.”

Bannon said he believed that terminating a customer or two on allegations of infringement would have sent out a clear message to other potential infringers. But of course, iiNet knows that if they complied with that request the studios would be back saying “you did it there, why can’t you do it here…here….here….here…..”

Bannon went on to say that while iiNet denied it had any control over BitTorrent clients and the potential for users to operate them for infringing purposes, it did have the power to render the software useless.

“But if the user isn’t online there’s nothing the BitTorrent client can do to infringe,” Bannon told the court.

For its part, iiNet sits firmly behind Section 112E of the copyright act:

A person (including a carrier or carriage service provider) who provides facilities for making, or facilitating the making of, a communication is not taken to have authorised any infringement of copyright in an audio visual item merely because another person uses the facilities so provided to do something the right to do which is included in the copyright.

Earlier the Internet Industry Association (IIA) had applied to contribute to the case as amicus curiae, or ‘friend of the court’. Justice Cowdroy decided today that the industry group would have little to add to the case, since the issues it planned to raise had already been covered in detail by iiNet, mostly concerning the ISP’s commitments under the Copyright Act and Telecommunications Act 1997.

Earlier this week at their annual general meeting, iiNet boss Michael Malone gave company shareholders some painful news. The costs of defending the AFACT case had amounted to $4m AUD (approx $3.7m US).

The court proceedings are scheduled to conclude today, but the verdict will not be issued for several months.

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In file-sharing terms, Spain currently has among the most relaxed laws of leading European countries. The country is believed to have some of the highest rates of online sharing of music and movies and currently it is perfectly legal, providing no money is made directly from infringement, to run BitTorrent and eDonkey sites.

As the copyright industries ramp up their lobbying, the government is finding it more and more difficult to maintain their current position, and is currently examining new ways to deal with illicit file-sharing.

At the opening day of a conference bringing together leaders of the telecommunications industry, European Commissioner for Information Society and Media, Vivane Reding, said that if the Spanish government implements measures to disconnect copyright infringers from the Internet without the oversight of a judge, it risks coming into conflict with the EU.

“Spanish measures that allow for the disruption of Internet access without a fair hearing before a judge, are certain to clash with the European Union,” she told the Telecommunications Market Commission (CMT) conference in Barcelona yesterday.

Criticizing France’s Hadopi legislation, Reding stressed that repressing people would not solve the problems of Internet piracy, noting that disconnections may even run counter to the “rights and freedoms which have become part of Europe’s values since the French Revolution.”

Furthermore, the “fundamental freedoms” of EU citizens which Reding insists forbids countries from disconnecting alleged file-sharers without a procedure involving a judge, also applies to Internet service providers.

This is of particular interest to customers of Ireland’s largest ISP, Eircom. Earlier this year IRMA – which controls 90% of Ireland’s recorded music and represents the likes of EMI, Sony, Universal and Warner – reached a private agreement with the ISP to implement a 3 strikes deal for alleged pirates, with IRMA discontinuing legal action against it in return.

The arrangement is an entirely private one, with no judicial oversight, which will likely bring it into conflict with the EU.

IRMA also took legal action against BT, Ireland’s largest ISP, and the country’s largest cable operator, UPC Ireland, to force them to follow suit.

However, last week IRMA discontinued its lawsuit against BT Ireland, as the ISP has already transferred its Internet customers to Vodafone. It is unclear if IRMA will now go after Vodafone, but the music group says it will continue to pursue UPC.

In addition, it will be interesting to see how the statement by the European Commission affects the Digital Economy Bill that was presented in the UK last week. The proposed legislation will also call for a disconnection of repeated copyright infringers, a measure that’s proving unpopular among the public. Thousands of people have already petitioned against the new bill.

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This March, IFPI – backed by several Hollywood movie companies – gave Telenor, Norway’s largest ISP, a warning: block your users from accessing The Pirate Bay within 14 days or we will take legal action.

Without any legal basis, Telenor refused to comply.

“This would be the same as demanding that the postal service should open all letters, and decide which ones should be delivered,” said Telenor boss Ragnar Kårhus.

The verdict in the case was due to be delivered October 30th, but was delayed until today.

IFPI has lost the case and Telenor will not have to block The Pirate Bay.

The court ruled that Telenor is not contributing to any infringements of copyright law when its subscribers use The Pirate Bay, and therefore there is no legal basis for forcing the ISP to block access to the site.

“Obviously we are pleased that the District Court has arrived at this conclusion,” said Telenor’s Ragnar Kårhus in a statement.

“At the same time it is important for us to emphasize that this case is not about being in favor of or opposed to copyright, but about whether or not it is reasonable to saddle Internet service providers with a censorship role in respect of content on the Internet,” he added.

Kårhus went on to say that the most important way for IFPI and other rights holders to maintain healthy revenue streams, is to develop business models and services that render the use of sites like The Pirate Bay less attractive to Internet users.

In making its decision, the court also had to examine the repercussions if it ruled that Telenor and other ISPs had to block access to certain websites. This, it said, is usually the responsibility of the authorities and handing this task to private companies would be “unnatural”.

This is a breaking news story and will be updated.

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This March, global music industry group IFPI gave Norway’s largest ISP an ominous warning – block your users from accessing The Pirate Bay within 14 days or we will see you in court.

Without any legal basis it would be unacceptable for the ISP to comply, so it was left with no option but to refuse.

“This would be the same as demanding that the postal service should open all letters, and decide which ones should be delivered,” said Telenor’s Ragnar Kårhus.

IFPI, rarely one to make hollow threats, especially where lawsuits are concerned, made good on its word and sued Telenor.

The then-Pirate Bay spokesman Peter Sunde felt that the lawsuit was an indication that IFPI was unhappy with the competition.

“They have had a monopoly on distribution and we’re breaking that monopoly, and in turn they sue people that allow access to our distribution method,” Sunde told TorrentFreak at the time.

The trial began on October 12th in Norway and for its part, Telenor argued that Norwegian law protects Internet service providers from liability for the actions of their subscribers. IFPI feels that the site is illegal and should therefore be blocked.

The verdict in the case was due to be delivered today, but there will be a delay.

According to Telenor’s Information Manager Atle Lessum, the judge has announced that due to illness the result will now be handed down next week.

The Pirate Bay is no stranger to blockades. From September 1st, an out of court settlement between Irish ISP Eircom and IFPI came into effect, which blocked customer access to the ‘Bay. Similar blocks are pending in Italy and The Netherlands.

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Back in August the UK government announced tough plans for dealing with online piracy. While the music and movie industries were notably supportive, opposition to the proposals were widespread. Those hoping that politicians might have had second thoughts are disappointed today.

While delaying a final decision until the next parliament, Business Secretary Peter Mandelson yesterday confirmed plans to have UK residents accused of illicit file-sharing disconnected from the Internet as a “last resort”.

Preceded by months of sending warning letters with an aim of achieving a 70% reduction in online piracy by 2011, Mandelson claims that only persistent offenders would be affected by the harshest measures – those accused of infringing copyrights multiple times.

However, downloading a single music track constitutes an infringement, so being accused on the basis of three or four tracks downloaded over a period of months could be enough to have an entire household disconnected from the Internet. Hardly the promised “proportionate” response.

While the Business Secretary is insisting that there will be an independent appeals process to ensure that any accusations are accurate, his words aren’t inspiring confidence with Internet service providers.

Yesterday, BT Group made a statement indicating its concern at the government’s proposals, noting its disappointed that ISPs will have to bear some of the costs of the scheme, resulting in increased prices for broadband customers.

As detailed earlier, those costs are likely to spiral to £365m per annum, putting the alleged music industry piracy “losses” of £200m in the shade.

“We are also interested to hear whether or not customers will have some form of fair legal hearing before their broadband supplier is required to take any action against them,” said BT.

TalkTalk, the UK’s second largest ISP, owner of the Tiscali and AOL brands and operator of the Dont Disconnnect Us website, went much further.

“The approach is based on the principle of ‘guilty until proven innocent’ and substitutes proper judicial process for a kangaroo court. What is being proposed is wrong in principle and it won’t work in practice. We know this approach will lead to wrongful accusations,” said Andrew Heaney, TalkTalk’s Executive Director of Strategy and Regulation.

According to a report this morning, TalkTalk is now threatening to launch legal action if Mandelson makes good on his threats and implements any disconnection scheme without due process.

“If the government moves to stage two we would consider that extra-judicial technical measures and would look to appeal the decision because it infringes human rights,” Heaney told The Guardian. “TalkTalk will continue to resist any attempts to make it impose technical measures on its customers unless directed to do so by a court or recognised tribunal.”

One pressing issue that seems to have been completely ignored is the existence of current copyright laws which are already being used to punish alleged file-sharers in the UK.

Companies like ACS:Law are already making accusations against UK Internet users who they claim are infringing the rights of their clients, demanding £600+ for the alleged infringement of a single music track.

Are we to have a dual system where Internet users can be both disconnected by the government and financially punished by private companies for the same offenses? The government should decide which system is to prevail and pick one, changing the law if necessary.

The full proposals for the graduated response scheme will be detailed in the Digital Economy Bill, set to be published later on this year.

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Tom Watson is a Labour Party politician for West Bromwich East in the United Kingdom. Famous for becoming the first MP to start his own blog, Watson was a Parliamentary Secretary at the Cabinet Office until his resignation in June this year.

During his time in the Cabinet Office, Watson says he spent 18 months “immersed in conversation with the UK’s digital pioneers” and is convinced that the country’s economic future depends on “developing a set of economic and regulatory arrangements (which includes copyright, the legislative mechanism at the heart of the filesharing debate) to hothouse our digital natives”.

Watson has been most vocal in his opposition to the proposals by the government to throttle, disconnect or otherwise interfere with the Internet connections of alleged file-sharers. “Not only do the sanctions ultimately risk criminalising a large proportion of UK citizens,” he said, “they also attach an unbearable regulatory burden on an emerging technology that has the power to transform society, with no guarantees at the end that our artists and our culture will get any richer.”

Taking his opposition to these proposals to the next level, Watson has now tabled an Early Day Motion (EDM) on the issue. An EDM is a device used by Members of Parliament to demonstrate the level of support among other MPs for a particular point of view. Although EDMs tend not to achieve results directly, they can attract the attention of the press, which fosters further debate and discussion.

Tom Watson – EDM 1997 – ILLICIT FILE SHARING – 12.10.2009

That this House notes with concern the Government’s proposals on file sharing which would allow rights holders to request internet service providers to disconnect for a period of time, or throttle, the internet connection of people who may be accused of copyright infringement via peer to peer networks; believes that disconnecting alleged offenders will be futile given that it is relatively easy for determined file-sharers to mask their identity or their activity to avoid detection; acknowledges that illicit file-sharing only costs rights-holders money when people download infringing content in preference to buying it; further notes that identifying offenders using the Internet Protocol address of a specific machine may punish those who share a web connection; and calls on the Government to ensure that any citizen accused of illicit file-sharing is given the right to legal redress in a court of law before sanctions are imposed.

At the time of writing this EDM tabled by Tom Watson has the support of 18 other MPs, and not solely from his own Labour Party either. Support is coming in from across the political spectrum, from Labour through to their opposition in the Conservative Party Liberal Democrats, Social Democratic and Labour Party and Plaid Cymru.

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