Ireland's largest ISP to start 'throttling' illegal downloaders

As record companies across the world continue to fight a largely losing battle to protect their copyrights, they are looking to a voluntary agreement with Eircom, Ireland's largest Internet service provider (ISP), as a possible new model.

Next month, Eircom will be rolling out the trial phase of the strategy promised in the agreement, testing a new "three strikes and you're out" approach to first delay, and then deny, Internet service to people who use filesharing networks to illegally download music.

First-time offenders will get a warning on their bill; a second offense will see service "throttled," which means that download speeds will be reduced to a snail's pace, and a third offense will cause disconnection.

One Dublin based file-sharer, Stephen Whelan, isn’t working up a sweat over the Eircom deal: “There’s plenty of other operators out there."

The music industry has been casting about for a means to limit filesharing for years; until recently, it was relying on a model of fear and punishment. But its public image has taken a beating – particularly after the heavy publicity it received for the recent $2 million judgment in its favor against a Minnesota woman who downloaded 24 songs.

Approaches like the one in Ireland are emerging as a new favorite. Last year, legislation in a number of countries moved closer to establishing this sort of graduated response model.

But Ireland is first in reaching a voluntary agreement and not requiring that an ISP have a court order to disconnect. An Internet detection company, DetecNet, will ferret out the IP addresses of those it believes are illegally downloading.

This week, Karoo, the sole ISP in the northeastern British city of Hull, formally announced a similar three-strikes policy. Earlier this month, the music industry sued two other Irish ISPs, BT Communications Ireland and UPC Communications Ireland, demanding they adopt a similar approach to Eircom's. Those companies have so far remained defiant, insisting they're not going to act as policemen for their subscribers.

A UPC spokesman says Irish law doesn't require ISPs to control content. "The company intends to vigorously defend its position in Court,” he says.

Consumer anger

Digital rights and consumer groups have reacted angrily to the arrangement.

"It is incredible," says TJ McIntyre, a law lecturer at University College Dublin and chairman of Digital Ireland, an advocacy group. "In Ireland, the music industry and Eircom seem to think it appropriate to impose this privatized Internet death penalty, with no public debate, no parliamentary scrutiny, and no court involvement."

Mr. McIntyre is particularly angry that Ireland's digital landscape could be changed so sweepingly without public input.

"In other jurisdictions, there has been public debate. There have been consultation papers in the UK, there has been legislation in France, there has been debate in the European Parliament, but in Ireland it's all proceeding in blissful secrecy behind closed doors."

Willie Kavanagh, managing director of EMI Ireland, sees it differently. His company joined Sony, Universal, and Warner in taking Eircom to court two years ago, and he says that illegal downloading has badly damaged the music industry in Ireland.

"Legitimate downloads and CD sales combined [dropped] from €146 million (about $208 million) a year to €102 million (about $145 million) a year between 2001 and 2007.... One-third of our market walked out the door in six years."

Why did they do it?

It's not easy to say why Eircom conceded so much to the record industry (How does the company view the deal? Click here.) It also agreed to voluntarily prevent its users from accessing filesharing sites like The Pirate Bay.

EMI's Mr. Kavanagh believes that Eircom simply decided they were going to lose in court. "It doesn't take much to work out that the next thing we're going to go for is loss of earnings and that will be tens of millions," he says.

But McIntyre calls that perspective "nonsense."

"European law is very clear here; the e-commerce directive provides an immunity. It says that ISPs may not be found liable where they act as a 'mere conduit' – in other words, where they're transmitting material from A to B, which is what they're doing in these cases. That is crystal clear."

The debate over filesharing has tended to crystalize along legislative lines. Consumer groups wave privacy legislation or the e-commerce directive at the music industry, which in turn waves copyright legislation back at them.

Kavanagh says that what's happening in Ireland will have global ramifications and cites a 2007 Belgian judgment – SABAM vs. Scarlet – that held a local ISP liable for copyright infringement. Scarlet, the ISP, has an appeal pending in a higher court.

University College's McIntyre predicts that any music industry hopes of using Ireland as a model will be thwarted.

"The tide is turning against these types of claims," he says. "The music industry has lost its attempt to push this through at a European level, it's lost its attempt in France, it's not receiving a receptive response in the UK."

Just last week, a Spanish court ruled that not-for-profit filesharing was legal, while in France, legislators delayed considering a bill to punish downloaders until sometime after the summer.