New copyright law may hurt small ISPs

Canada’s new Copyright Modernization Act might make would-be downloaders think twice when looking for dubious media files on the Internet, but Internet service providers are footing the bill for the extra security measures. 

Since Jan. 1, Internet service providers have been obligated to send out emails notifying customers suspected of downloading copyrighted material, such as music, movies, or television shows.

The notices sent to users appear to serve more as a warning. They’re not an automated summoning to court for the average downloader to square off with a team of Hollywood lawyers hell-bent on protecting the likeness of Bugs Bunny.

But these notices do carry some weight to deter internet piracy. 

The legislation says the maximum amount a company can sue for proven copyright infringement is $5,000 if they choose to go to court. ISPs are now obligated to keep these records for up to a year in the event a company sues. 

The emails typically sent to users indicate a copyright enforcement firm, usually hired by a studio or similar entity, has a detailed record of a copyright infringement as well as the internet protocol (IP) address of a user, the name, location, and date of when the questionable file was downloaded.

ISPs are no strangers to these notices. They’ve been receiving them from copyright holders for almost a decade.

“These notices have been a fact of life for years,” says Nick Ouzas, executive director of National Capital FreeNet, based in Ottawa. 

NCF is a co-operative ISP that was launched in 1992. Ouzas says before the legislation was passed, he was already forwarding similar notices manually to NCF users. On average, Ouzas says he used to send five to 10 each day.

“What we (used to do) is an informal forwarding of those notices to members,” Ouzas says.

But now, “you have to be absolutely bullet-proof” in the manner in which an ISP notifies users.

He says ISPs must be able to point to a precise time and date when users were notified of an infringement in order to prove diligence on the part of a responsible, law-abiding provider. 

“(The system) has to be completely automated, and you have to have good record keeping,” Ouzas says. “We have to write software to do this.”

Much larger ISPs, such as Bell and Rogers, likely have less work to do in order to fulfill the requirements of the new act. 

Rogers already has an automated system that it uses to notify users of infringement, according to spokesman Kevin Spafford. 

“The biggest change is that it was voluntary in the past, and now it’s a legal requirement,” says Spafford. 

Both ISPs say they vigorously protect their customers’ identities from copyright holders unless a court order is presented. Most ISPs view privacy protection as an industry standard.

But the new law requires ISPs to step up their game and smaller ISPs might feel it the most. 

“Basically, we’re eating the entire cost of this (new law), that’s the way it works out. Will that drive us out of business? Probably not, (but) it’s certainly not something we’d be liking to do for free,” says Ouzas.

The notification system seems to be an effective means of deterring downloaders without the need for adjudication. 

Data provided by Rogers in 2011 indicated 67 per cent of customers who receive a single notice cease their copyright-infringing activity and compliance tends to rise with each consecutive notice. 

But it appears that serious pirates still might be laughing all the way to free discographies and software. “Cornelius,” who didn’t want his real name used, says he first downloaded Windows XP illegally when he was nine years-old. 

“I liked my Limewire,” Cornelius says, referencing a peer-to-peer program from the early 2000s. 

“I probably won’t be torrenting all that much anytime soon,” he added. “Partly because of the (law) but also because I have what I want already.”

Cornelius indicates that when the time comes, he’ll likely get a Virtual Private Network, or VPN, which can mask a user’s IP from prying eyes. 

“It won’t be for music either, because I want to support the artists I listen to – but more for software. The expensive stuff, you know.”

The added operating costs of ISPs as a result of the new act could potentially be shouldered on to consumers, meaning higher prices for the same services.

“I’d hate to have to pay more,” says Centretown resident Magdalyn Wattie. 

“But I don’t see the new law changing much for me,” she says, adding that she only uses the Internet to watch Netflix or go on Facebook.