Britain's Digital Economy Bill will cost ISPs £500M, knock 40K poor households offline

In the UK, Business Secretary Peter Mandelson has tabled his "Digital Economy Bill," a terrible piece of legislation that requires ISPs to police their customers on behalf of the music industry when the latter claims that its copyrights have been violated (no evidence necessary). The UK music industry blames piracy for £200 million in annual losses, and this is Mandelson's excuse for abridging human rights and fundamental justice in his witch-hunt for pirates.

But the government's own research shows that Mandelson's plans will cost the UK ISP industry £500 million to implement, and when these costs are added to each customer's bill (as they surely will be), the rise will be enough to knock an estimated 40,000 British families off the Internet.

What's more, the government's own Digital Inclusion research has shown that poor households with Internet access enjoy a substantially higher quality of life than their offline neighbours, thanks to a variety of factors, from low-cost online shopping, to savings through online utility billing, to better research tools for school-kids, job-seekers and people with health problems.

Half a billion pounds down the drain, 40,000 of Britain's most vulnerable families knocked offline, and for all that, there's no reason to believe that Mandelson's plan will do anything to reduce piracy.

Today, according to a new report, government ministers have admitted that the costs will amount to £500m ($799.2m).

ISPs say that issuing warnings will cost every customer £1.40 ($2.24) and otherwise meddling with accounts at the behest of the music industry will add £25 ($40) total to an annual subscription.

Worryingly, ministers say that this extra cost will force 40,000 UK households offline, with BT's John Petter calling the plans "collective punishment that goes against natural justice."

Jeremy Hunt, the Shadow Culture Secretary, said that it is "grossly unfair" for the government to force all broadband customers to foot the bill, and noted that forcing tens of thousands offline will go against government targets of increasing Internet take-up among the most disadvantaged communities.

Piracy Surcharge Set To Force 40,000 Households Offline


  1. Many of the comments to the article Cory links to seem to assume that this is an annual flat licence fee that would allow users who paid it to download as much as they wanted. Now, whilst that has been proposed, it’s not what the government are seeking to do. This £25 per year is to fund measures aimed at pursuing file-sharers.

    Other comments suggest an attitude of “if I’m being billed £25 a year for no benefit then I’ll definitely download more just to make up for it”.

    So, reactions seem to be a mix of misguided belief that this is a pass for downloading and angry resolve to treat it as if it is. If this is at all representative of the reaction of UK net users (i.e. most of the population) then I do not see the DEB reducing file-sharing one whit.

  2. If some countries see Internet access as a human right (rightly IMHO), and some commentators call this collective punishment (also justified), we would still have to be “protected persons” for Article 33 of the 4th Geneva Convention to apply:

    Article 33. No protected person may be punished for an offense he or she has not personally committed. Collective penalties and likewise all measures of intimidation (…) are prohibited.

    So are we in an occupied territory?

  3. government ministers have admitted that the costs will amount to £500m ($799.2m)

    Based solely on that line, I predict that the actual cost will be closer to £750m.

  4. £25/year would certainly be painful for this family. I don’t know whether it would knock us off the internet, or whether we would just decide that if we’re committed to spending that much money, we might as well spend a bit more and get a faster connection than we have now (fast enough to run TOR, for example).

  5. And let’s not forget, this is on top of the proposed 50p a month tax on every phone line.

    Given that I don’t trust the Government on financial costings, and given that they will only increase once

  6. This scheme will cost £500 million a year and will increase music and film sales by £1.7 billion over 10 years.

    Now maybe I’m bad at maths, but spending £5 billion to increase profits by £1.7 billion doesn’t actually make any kind of financial sense whatsoever.

    When the new law inevitably fails to produce the results the music and movie industry wants, I have no doubt that the £25 a year fee will increase.

    And let’s not forget, this is in addition to the proposed 50p a month tax on every phone line(!)

    1. So the numbers say that this is a Bad Idea, but since when has that ever stood in the way of an unbelievably stupid idea?

      Thing is, I don’t download music or movies. I’ve got spotify and a television, and friends. Why should I have to pay an extra £25 a year just so the ISPs can fullfil their legal obligation to tell off those people who do?

      I’ve got an idea. Why don’t you all pay me £25, and if you get sued, I’ll pay your settlement fee to get the douchebags off your back.

      This is just one of a succession of monumentally stupid ideas that have dribbled out of the Labour Party’s leaky adult nappy. It’s little wonder then that we feel as though we are being shit on, and hope that someone else comes along to clean up the mess.

  7. MD1500: £500 million is half a billion rather than £5 billion, so it’s half a billion for a £1.7 billion return. in any case, the objections lie beyond a simple cost benefit analysis

  8. If we were just asked to pay a £30 annual fee for truly unrestricted UK broadband access, we might actually be in favour of the same cost.

    About 60% of ~25m households (those with broadband) is at least 15,000,000 30-pound payments – and increasing daily. That’s >£450 million in extra annual big-media revenue without policing, legislating on or damaging (throttling etc.) the Internet’s infrastructure.

    I don’t like how we arrived at this point, but if we have to pay £30 a year let’s call it what it is – another fee for the end user to cover. A lot of people dislike the (much larger) TV license, but pay it anyway.

    There’s a thought – stick about £20 on the TV license and call it an “audience license”. The payment/penalty systems are already in place, and ISPs have our addresses so can issue license notices (I believe TV shops awkwardly have to ask for this info for license checking?).

  9. “government ministers have admitted that the costs will amount to £500m ($799.2m)”
    “Based solely on that line, I predict that the actual cost will be closer to £750m.”

    You must mean £799.2m. Everyone knows in the music industry $1 = £1 (= €1)

  10. Anon @ #8: “MD1500: £500 million is half a billion rather than £5 billion, so it’s half a billion for a £1.7 billion return. in any case, the objections lie beyond a simple cost benefit analysis”

    Eh, that’s £500m PER YEAR for a return of £1.7b OVER 10 YEARS, or £170m/year.

  11. American readers might be confused by the verb “to table.” In the context of parliamentary procedure, e.g. Robert’s Rules of Order, when you “table” a proposal, or “lay [it] on the table,” you take it OUT of consideration, perhaps permanently. I gather the UK Business Secretary has done the opposite.

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