DEB - Costs Consultation
The Government has published a consultation on how the costs of the notification obligations under the Digital Economy Bill should be shared out between Rights-holders, ISPs and subscribers. Responses are required by May 25th.
(And no, you haven't missed anything. It still is a Bill, not an Act, though consulting on its implementation does seems to presume that something pretty like the current text will be passed before the General Election on May 6th).
Three groups of costs are identified:
- Capital and operational costs for ISPs of receiving and processing Copyright Infringement Notices and managing serious infringer lists;
- Costs of the process for hearing appeals against notices;
- Costs incurred by OFCOM in establishing and supervising these processes.
The Government seem to have moved from their original idea that costs should be split 50:50 between ISPs and Rightsholders, to a position that Rightsholders, as major beneficiary, should bear the majority (75% has been suggested) of the costs. However this still means that ISPs will be incurring new costs that cannot be recovered (item 1) as well as paying fees to other organisations (items 2 and 3).
A further significant issue raised by the consultation is whether a subscriber should have to pay a fee to appeal against an Infringement Notice. The consultation suggests that a nominal fee (refundable on success) would discourage frivolous appeals but also recognises that a fee might disadvantage those of limited means. Given that the Appeal will be the only way to detect and fix faults in reporting systems, my personal inclination is that I'd be nervous to see any barrier to invoking it.
As with the rest of the Bill, this consultation is firmly stuck with the problems caused by the unclear definitions in the Bill itself. The consultation paper quotes two separate assessments that either 20 or 450 "ISPs" will be in scope; of course if the Minister's statement in the Lords that most universities (and colleges, presumably) will be "regarded as ISPs" then the number is going to be a lot greater than either of those.
I'll be preparing a JANET response commenting on those uncertainties and encouraging full consideration of the incentives created by the cost allocations. I've not worked out exactly what those incentives are yet, but at first glance it seems unlikely that the same split is right for all three groups of costs. For example the 25% cost allocation for notification systems is supposed to encourage ISPs to make those systems efficient, but I can't see how that applies to the appeals process, which ISPs have little or no control over. Comments and suggestions are very welcome, especially if you spot something I've missed.
(UPDATE: much of the analysis in the Government's proposal is based on a paper they commissioned earlier in the year. That has a very clear explanation of how the process might work, so is worth a read for that alone).
