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Digital Economy Bill: The Half-Billion Pound Price Tag

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One item definitely not in this year’s post-Christmas sales: ISPs estimate that the proposed Digital Economy Bill, the government’s newest effort to combat digital piracy, could cost consumers up to £500 million if it is put into effect.

SEE ALSO: Digital Economy Bill: Most Lords Support It, But Excessive Powers Draw Suspicion

The bill offers up a graduated response to illegal file sharers, with warning letters being followed by slowed down internet connections and eventual cut-off if they do not cease their activities.

ISPs, according to a report in the Times, claim that the Bill would translate into charges of around £25 per subscriber to execute the measures. While those figures have not been confirmed by independent sources, ministers do say that the initial letter-writing campaign, which could cost £1.40 per subscription to implement, may lead up to 40,000 subscribers giving up their internet connections.

Not everyone is losing out, though: impact assessments for the Bill say it could generate up to £350 million in extra tax for the government, and would bring in an extra £1.7 billion in sales to content owners.

ISPs weighing in with their opposition to the Bill include Talk Talk, the country’s largest consumer broadband provider, as well as incumbent BT (NYSE: BT). Charles Dunstone, the CEO of Talk Talk, is pushing for content providers to pay if the legislation goes through: “Broadband consumers shouldn’t have to bail out the music industry. If they really think it’s worth spending vast sums of money on these measures then they should be footing the bill; not the consumer.” John Petter, the MD of BT Retail, says the measures have not been thought through; he points out that if, for example, someone misuses the Internet at work, the entire business could lose its internet connection as a result.

The Bill gears up for its next stage of scrutiny: it goes into committee stage on 6 January for a line-by-line examination.

Dec 28, 2009 9:04 AM ET

Posted In: Legal, Regulatory, Countries, Europe, UK

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