New Zealand’s Economic Development Ministry is currently reviewing the fees the recording industry and movie studios pay ISPs to send out infringement notices. Submissions sent in by the entertainment industry as part of that process and later obtained by Fairfox under the Official Information Act have turned up some interesting claims, not least that the movie industry has sent out a grand total of zero warnings.

But despite ignoring the system they lobbied to have introduced, the Hollywood-backed Federation Against Copyright Theft told the government that the illegal viewing of the top 200 movies by New Zealanders dropped from 110,000 instances in August to just 50,000 in September 2011, a better than 50% reduction.

However, NZFACT complain that progress has since ground to a halt. So in order to reduce piracy further they’re going to have to do what they have failed to do so far – actually send out some warnings. What is stopping them doing so, they say, is the high cost. Currently the price they have to pay ISPs is $25 NZD (roughly $20 USD) per notice, but the studios want this cut back “to pennies” each.

And the studios aren’t the only ones complaining about the costs either. RIANZ, the Recording Industry Association of New Zealand, said that in order to do something about the 41% of locals who access copyright infringing services, they would like to send out 5,000 notices per month, up from the total of 2,766 they sent between October 2011 and April 2012. But to make that cost effective the price would have to be cut from $25 NZD to just $2 NZD per notice.

But the indications are that in their submissions the ISPs are pulling in the opposite direction. Telecom said that the fee per infringement notice should increase four times over to $104 NZD each. The ISP said that it had spent more than half a million dollars putting the three strikes mechanism in place but had sent out just 1,238 notices since it began.

In addition to the movie studios effectively boycotting use of the entire system, it seems that the recording labels have no appetite to go through with the punishments they demanded for the most persistent offenders. Three ISPs report having customers on their “third strike” and due to go to the Copyright Tribunal to be fined up to $15,000 NZD. But the labels let all of their cases lapse meaning that they now have a completely fresh start.

InternetNZ chief executive Vikram Kumar told Stuff he was glad that no one had been fined, and that the answer to the piracy problem lies elsewhere.

“Make material available in time, in the way people want it, and most of the problem will disappear,” he said.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Those who are discovered uploading copyright material are first sent two warnings via their ISP. On receipt of a third, copyright holders can take Internet account holders to the Copyright Tribunal where they will face fines of up to $15,000 and disconnection.

While it may sound straightforward, the steps in the previous paragraph face problems. At best the evidence gathered by rights holders is only accurate enough to identify an ISP account from where an infringement took place, it cannot identify the actual infringer. The New Zealand government have dealt with this eventuality by making account holders responsible for infringements even if they didn’t carry them out.

This situation hasn’t gone unnoticed by Reddit user “drunkonthepopesblood” who says he has somehow gained access to the Internet via a government-owned connection (he doesn’t say how – could be wireless, he could be a government worker) and is now sharing copyright material.

“I’m officially downloading copyrighted material on P2P protocol on Government ISP. Lets see what happens,” he announced.

Several hours later his update read: “6:30am no signs of a dawn raid & thoroughly enjoying all of my newly acquired Miley Cyrus movies and soundtracks.”

The clear intention here is for the government to receive 3 strikes warning notices from the entertainment companies’ P2P monitoring partners so that they are disconnected from the Internet – to give them taste of their own medicine, if you will.

Gareth Hughes, ICT spokesman and MP for the Green Party has been an outspoken critic of the 3 strikes legislation. Even so, it was quite a surprise to see him pop up during the Reddit discussion.

“Wow that was fast, but not surprising,” he said in response to the attempt at framing the government for illicit sharing.

“I asked a series of questions [in] Parliament about this yesterday and have written to the Speaker because I don’t think he’s considered the impact this will have on him – as [the] account holder responsible for all alleged infringements,” he added.

“This law could bring the gears of government to a grinding halt because the holder of the account — Parliamentary Services — provides internet access to hundreds of users anyone of whom could cause infringement notices to be sent,” he noted in a separate statement Wednesday.

Hughes also levelled criticism at the government when it was revealed that the official website informing the public of the law’s implications won’t be launched until next Wednesday, one week after the infringement process begins.

“The Government has a responsibility to ensure that public institutions can navigate around the new law and not run the risk of fines or disconnection,” said Hughes.

“By not providing information or advice and relying on InternetNZ, Internet Service Providers, and the media, Mr Power has left schools and universities in a legal grey area.”

Hughes raised the issue with Commerce Minister Simon Power during a parliamentary session yesterday (video embedded below) but the question was disallowed.

However, perhaps the most disappointing part of the video comes at 4m 28s as Hughes asks Simon Power what the government is doing to encourage legal downloading, such as the uptake of Netflix.

“That is a good question,” said Power, laughing into his response.

“Because I have no idea what [Hughes] is referring to…”

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

Opponents to three-strikes, or ‘Graduated Response’ laws have been boosted in recent weeks by the news that the UN has condemned such laws, citing their disproportionate  nature (that the punishment is far greater than the alleged crime warrants). In the wake of this statement, UK groups have started pushing ever harder to get significant parts of the Digital Economy Act (DEAct) – which has already cost the taxpayer around £5.9Million – repealed.

The Act, passed in an incredible rush in 2010 has been constantly under fire for legitimizing the practices of accusation-based punishment. On June 14 an Early Day Motion was submitted to the Government, building on the UN’s report, asking that a review of the DEAct be undertaken, and is currently signed by 20 MPs.

The UK Pirate Party is also putting pressure on the Government, with it’s “Axe the Act” campaign. The campaign asks UK citizens to urge their MP to support the Early Day Motion, as well as a petition.

Since errors in graduated response schemes have now been publicly documented, and the whole system has come under global condemnation, how long will it be before content industries are pushing a new ‘golden bullet’ to solve the claimed problems of piracy.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

When ‘caught’ uploading copyright works for the first time, the owner of the Internet connection used for the alleged infringement will receive an email warning. On allegations of a second offense, a physical letter will drop through the door. On the the third, the account holder will be summoned to appear before a judge who will have the power to fine, or even disconnect them from the Internet.

French senator Michel Thiolliere has told the BBC that the so-called Hadopi legislation will have the desired effect, with nearly everyone warned a second time abandoning illegal file-sharing for good.

“What we think is that after the first message… about two-thirds of the people (will) stop their illegal usages of the internet,” he explained

“After the second message more than 95% will finish with that bad usage.”

It is, however, much more likely that after getting a first warning, or even before, French Internet users will try to find a way round this system. They will discover that it’s surprisingly easy.

6 Ways Savvy Internet Users Will Neutralize Hadopi

Free options

MP3 Search Engines

One of the simplest ways to find music online is to use an MP3 search engine. That won’t be difficult as there are dozens to choose from. Sites like Skreemr, Songza, beeMP3, MP3Realm and AirMP3 are very simple to use and since there is no uploading, they drive a cart and horses through Hadopi. For those who don’t mind getting their hands dirty, Google offers similar functionality with their filetype: search operator.

Direct Downloads

During 2008 and 2009, the continued rise of blogs and forums that link to music, movies, tv shows and games stored on so-called cyberlocker sites was difficult to ignore. Although links can get taken down very quickly by copyright holders, they are often replaced just as swiftly by the communities that frequent such sites. The international music industry is particularly worried about the phenomenon, as tracking those that download from sites such as Rapidshare and MegaUpload is completely impractical.

Of course there are also perfectly legal alternatives, such as the excellent Jamendo.

Streaming Music and Video

While there are dozens of sites to visit directly, for those who really can’t be bothered to look any further and don’t mind closing a couple of slightly annoying popups, OVGuide is a huge portal to thousands of movies, TV shows and general video. With the assistance of the DivX plug-in, most content can be streamed directly in compatible web-browsers.

Music fans who don’t mind to stream tracks in their web browser actually have a few dozen legal alternatives. Grooveshark is one of the most elaborate music services. It holds more content than the average download store, supports playlists and it will roll out an iPhone app.

Premium options

Overseas MP3 Sites

Just over the English Channel from France lies the UK. Research carried out there recently by the BPI indicated that usage of MP3 pay sites had increased by 47%. While users do have to hand over money to use these services, at a tiny fraction of prices they would pay in their homeland they prove attractive to those on a tight budget.

Newsgroups

Using Usenet, or newsgroups as they are commonly known, is one of the most secure ways of downloading movies, TV shows, music and video games.

While the learning curve on Usenet is considered by many to be quite steep, once an individual discovers .NZB files – the .torrent of the newsgroup world – everything is hugely simplified. Within seconds of starting a transfer, the user’s connection will be completely maxed-out.

On a practical basis, and certainly as far as Hadopi is concerned, paying a few euros each month for a decent newsgroup account means that French citizens need never fear being disconnected from the Internet. Indeed, not even the first warning email will arrive.

Anonymous VPN

While the above options require that Internet users modify their behaviors, by spending a few euros a month on an anonymous VPN account they won’t have to change any of their habits at all. They can continue to use BitTorrent, eD2K or any other P2P method of file-sharing.

Once subscribed to a service such as Netherlands-based ItsHidden (who also offer a free, but speed-limited service), Hadopi file-sharing investigators will believe that the user behind that IP address is from another country and simply move on.

As the failed and now largely abandoned campaign against file-sharers in the United States proved, scare tactics simply don’t work. There are millions of file-sharers in France and many will simply carry on their activities in the belief that the odds of being caught are extremely slim.

And they would be absolutely right.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

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.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

However, none of this stopped the lobby groups, or the politicians looking to push for the ruling.

In the EU, the amendment, which would protect against 3-strikes laws by requiring due judicial process to occur before any sanction (such as cutting off Internet access), has been substantially watered down. Meanwhile, in France the Constitutional Court has ruled in favor of a slightly modified version of HADOPI – their legislation which includes a 3-strikes sanction.

On Tuesday, the Parliament gave up on Amendment 138, which had been voted on twice by the assembly, gaining a majority both times. The amendment was supposed to protect the rights of citizens from being treated as guilty upon the accusations of an industry group, and punished based on the same. It read;

Applying the principle that no restriction may be imposed on the fundamental rights and freedoms of end-users, without a prior ruling by the judicial authorities, notably in accordance with Article 11 of the Charter of Fundamental Rights of the European Union on freedom of expression and information, save when public security is threatened in which case the ruling may be subsequent.

Instead, they are now considering a version which does not guarantee the right to an effective and timely judicial review.

Christian Engstrom, the Pirate Party’s MEP, commented on the amendment in his blog. He included the differences in text that have been made since Tuesday (bold denotes added text, strike-through indicates removed) in a meeting between three negotiators for the European Parliament and representatives for the Council of Ministers.

The changes included the removal of the judicial guarantee, that any measures should come only after a fair an impartial procedure (and should now just ‘respect’ such things), and the ACTA-like inclusion of ‘National Security’ clauses.

He summarized things simply, saying: “It shows utter contempt for Parliament by totally ignoring everything it says. The Council plans to bypass Parliament and once and for all prove that it is they who make the decisions, end of story.”

Meanwhile, France’s highest Constitutional Court has approved a slightly modified version of HADOPI. While initially blocked last September, a change to require a judge to sign off on the disconnection action (rather than the Agency itself) has meant it passed the Court. However, such court measures will be ‘fast tracked’ rather than given full judicial process, a situation the New York Times describes as ‘similar to traffic violations’.

This has angered many, including (of course) the Pirate Party. Laurent Le Besnerais of the Parti Pirate and Pirate Party International called it “a huge blow for Internet Freedom.”

“In June 2009, this same Council declared that Internet access is a fundamental right which cannot be restricted without judicial process,” he told TorrentFreak. “Today, the council gives a judge the right and responsibility to pronounce a closure of Internet access to anyone suspected of having shared illegally. Furthermore, the suspect will have to prove his innocence, which creates a presumption of guilt.”

With the flip-flopping over these measures, it can only be seen as a greater boost for the European Pirate Parties in future elections. However, since much of the party works and draws its support online, there is the risk that members could start having their net connections cut off. With evidential standards so low, would it really be beyond the realms of possibility that political critics of these plans could end up being cut off at the say-so of those they oppose?

If all goes as planned the agency will be staffed next month, with letters starting in the new year, and terminations starting as soon as next summer. How long the law will stay once the innocent start being punished is harder to predict. As with IPRED, the people the law aims to deal with will just use seedboxes, VPNs, and open WiFi hotspots instead of their home connections.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

This week alone we’ve had an Early Day Motion from a member of Lord Mandelson’s own party, and more recently ISPs have talked about the futility of the suggested legislation.

Mandelson reportedly started pushing it after a meeting with Hollywood mogul David Geffen, and was apparently uninterested in the whole situation prior to the meeting, although that claim was flatly denied.

Now, the All Party Parliamentary Communications Group (apComms) has released its own findings to its more broad consultation, and it’s not good reading for 3-strikes proponents.

There were significantly fewer responses than for other similar consultations, although the scope was much wider. It was also much more open, without assumptions or leading questions. It was, in fact, fairly neutral and seemed to be concerned with gathering information, rather than trying to solicit support for a predetermined policy. Most appropriately, it was titled “Can we keep our hands off the net?”

The topics covered included dealing with ‘bad traffic’ (which includes copyright infringement, P2P and botnets), behavioral advertising (such as Phorm), online privacy and child pornography procedures. Finally it dealt with the issue of who should foot the bill for Internet traffic, and whether network neutrality should be codified. The first and last questions are of particular concern to TorrentFreak, and the conclusions make for interesting reading.

On the subject of P2P and copyright enforcement, they came to the following conclusions;

58. We conclude that much of the problem with illegal sharing of copyrighted material has been caused by the rightsholders, and the music industry in particular, being far too slow in getting their act together and making popular legal alternatives available.
59. We do not believe that disconnecting end users is in the slightest bit consistent with policies that attempt to promote eGovernment, and we recommend that this approach to dealing with illegal file-sharing should not be further considered.
60. We think that it is inappropriate to make policy choices in the UK when policy options are still to be agreed by the EU Commission and EU Parliament in their negotiations over the “Telecoms Package”. We recommend that the Government terminate their current policy-making process, and restart it with a new consultation once the EU has made its decisions.

Network Neutrality and actual bandwidth availability was also a concern, with the following recommendations being made;

212. We recommend that Ofcom keep the issue of “network neutrality” under review and include a section in each annual report that indicates whether there are any signs of change.
214. We recommend that Ofcom regulate to require ISPs to advertise a minimum guaranteed speed for broadband connections.

We know that many of our UK readers will be happy with the last recommendation, especially after a study by OFCOM earlier this year found that many subscribers were seeing an average of 40% of their connection’s advertised speed. A more appropriate advertised speed will also prevent many BitTorrent clients from being setup for speeds they can’t actually achieve.

If you thought that such open minded, clearheaded and competent recommendations couldn’t have come from elected officials, well, the good news is they’re not all luddites. ApComms’s Joint-Chairman, Derek Wyatt MP was formerly Head of Programmes at WireTV, before becoming the director of BSkyB’s Computer Channel (later ‘.tv‘), leaving when he was elected to government. Other executives of apComms include a former BT researcher (Chris Mole MP), and Dr Nick Palmer MP, who has studied AI at MIT.

An extremely well-educated and technologically literate group making these recommendations should help carry some weight. Whether or not it will be enough to convince the Peter Mandelson’s and Sion Simon‘s of the government, remains to be seen.

The full report is available here.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

“The lesson of iTunes and Spotify is that what people want is ease of use and convenience and cheapness. And you only have to look at the decrease there has been in filesharing since the increase in popularity of Spotify.
“You only have to look at the number of people who came off illegal filesharing when iTunes came out to know that filesharing isn’t the answer, it’s not the future, it’s not valuable of itself – it’s a technology that currently is being used to circumvent the law.”

However, his words, as reported by the Birmingham Post, lack a certain ring of truth. For example, let’s take the claim that file-sharing decreased after Spotify gained popularity. While we agree that the service has the potential to convert many music pirates, its effect on the overall volume of file-sharing is simply not there.

The Pirate Bay informed TorrentFreak that traffic from the UK is still growing, at an average of around 1% per month. Mininova likewise has seen a 15% growth, of 7 million unique visitors a month, from 38.6 million in September 2008, to 45.6 million in August of 2009. Clearly Spotify hasn’t decreased much. Strike 1.

More worrying though is the claim that file-sharing technology is not valuable. For one, Spotify itself is based on file-sharing technology, with the brain behind the popular BitTorrent client uTorrent as one of its main developers. That aside, the state-funded BBC is involved in various BitTorrent-based projects, and the technology chiefs there believe that P2P TV has a future, and many independent artists are already putting it to use.

Over the past few years, we’ve brought you dozens of stories about people being enabled by the technology, from independent artists, to filmmakers (large and small) and even large corporations that can now effectively distribute data without incredible bandwidth outlay. File-sharing technology is very valuable to those people, Strike 2 for the MP from Birmingham.

That brings us to another statement Simon made, with Yahoo reporting him as saying that whilst it is illegal, there is currently no anti-piracy legislation. Those that have read our stories about Davenport Lyons, and ACS (and the thousands they have targeted) know there is indeed legislation. So too does Alan Ellis, and the Oink uploaders who were sentenced earlier this year. For Mr Simon, that’s strike 3.

It’s just lucky for him that no-one’s proposed a law where if an MP has gone on the record and made 3 basic factual errors, his parliamentary benefits should be cut off or throttled.

Mr Simon was contacted for comment, but did not reply at time of press

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

On July 8th, a modified version of the bill was accepted by the Senate following reassurances that any final decision to disconnect an Internet user under a 3 strikes regime would be handled by a judge.

Last week French legislators voted on this compromise bill. In the National Assembly it passed with 285 votes in favor and 225 votes against. This acceptance signaled the bill would move to the Senate for approval.

The bill, which has received strong support from President Nicolas Sarkozy and musican first lady Carla Bruni, was passed yesterday in the joint legislative committee of the two houses by 258 votes in favor to 131 against.

Under the law, once an individual has been warned about a third online copyright infringement, he or she will enter a mechanism which will see them reported to a judge. After a hearing the judge will have the power to cut the individual off from the Internet, and issue a range of other penalties including fines.

Reporters Without Borders referred to the legislation critically, saying it was “..alarmed that the alleged offender will not be given details of the illegal download when the disconnection order is issued. This recalls the censorship methods in force prior to the 1881 press freedom law, when the censor did not have to tell offenders why they were being censored.”

The bill now requires Nicolas Sarkozy’s signature to become law, but even this will face dissent.

The opposition Socialists, who were responsible for taking the earlier version of the law to the constitutional council, immediately announced that they will mount another challenge.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.

On July 8th, a modified version of the bill was accepted by the French Senate after assurances were made that the final decision of disconnection under a 3 strikes-style regime would be passed to a judge.

The new structure is suggested as follows. Once an individual has been warned about a third online copyright infringement, he or she will enter a mechanism which will see them reported to a judge. After a hearing the judge will have the power to cut the individual off from the Internet, issue a fine of up to 300,000 euros, or even hand out a 2 year jail sentence.

Furthermore, innocent ISP account holders who find themselves accused over the infringements of a 3rd party could be found guilty of “negligence”, risking a maximum 1,500 euro fine and a 4 week disconnection.

Today French legislators voted on the new compromise bill. In the National Assembly it passed with 225 votes against and 285 votes in favor. The bill (now known as Hadopi 2) will now move to the upper house (the Senate) for approval. It will then be signed into French law.

Source: TorrentFreak, for the latest info on copyright, file-sharing and anonymous VPN services.