ISPs and rights holders quietly ditch three-strikes piracy scheme

If you've dabbling in the torrents lately, it's unlikely you'll receive a letter from your ISP in the post any time soon, after the peak body representing Australia's Internet service providers revealed that the industry's proposed scheme has been quietly shelved.

Communications Alliance joined forces with Foxtel to notify the Australian Media and Communications Authority of the news in a letter last month.

According to the letter, co-signed by Comms Alliance and Foxtel (representing rights holders including likes of Village Roadshow, the Australian Screen Association and ARIA), it had "not proved possible to reach agreement on how to apportion all of the costs" for a three-strikes scheme in Australia.

In 2014, then Communications Minister Malcolm Turnbull told rights holders and ISPs they would be required to devise a so-called "graduated response" scheme as a way of tackling piracy. The draft code was released in February 2015, outlining a system to send copyright infringers multiple "education" and warning notices about their online activities. But the September 2015 implementation date passed and Village Roadshow said in February that parties had struggled to see eye-to-eye on costs.

Comms Alliance CEO John Stanton now says that while rights holders and ISPs were able to agree on the bulk of the scheme, "the sticking point was processing costs" -- including the money involved in preparing infringement notices, contacting alleged pirates and "dealing with incoming calls from unhappy recipients."

These costs were billed as "significant" (though Stanton says exactly how significant was a matter of "difference of opinion"). While he says the scheme is "not dead," ISPs and rights holders don't want to "reinvigorate" it until a review in April 2017.

And while Village Roadshow head Graham Burke had previously mooted an automated scheme for detecting piracy and contacting suspected infringers, Stanton says that system wouldn't come cheap.

"It is possible to largely automate it, but that's quite an expensive undertaking," he said. "We've had ISPs run a ruler over how much it would cost...and it was in the multiple millions."

Instead, all eyes are on other avenues for attacking the piracy problem in Australia. A Foxtel spokesperson says its immediate goal is to "assess whether other steps will be effective in reducing levels of piracy."

The pay TV provider is currently taking legal action in the Federal court, alongside Village Roadshow, in a bid to block a number of overseas websites associated with piracy. Both rights holders want ISPs including TPG and Telstra to block the sites. But if early hearings are any indication, costs are also going to be a major sticking point in this legal action.

But Comms Alliance has long held the view that site-blocking is a "blunt tool" that needs to be carefully implemented.

Instead, Stanton says telcos and ISPs are keeping an eye on the rise of subscription video on demand services and the reduction in release windows for big titles, saying these supply factors are having an effect on diminishing the lure of torrenting. While he concedes there's some way to go, Stanton says ISPs are already "seeing a reduction in peer-to-peer traffic travelling across their networks" -- a sign that he says shows torrenting isn't as prolific as it once was.

Updated at 6:15 p.m. AEST: Added comment from Foxtel.