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It is impossible to know precisely what is happening with the broadband levy or even, as it is being called by Ministers now, the Broadband Tax. The oddity in the naming is that its proper name should be a 'a telephone line tax to fund a better broadband network.' If it was a pure broadband tax it would be levied against just broadband services.
The Times leads with a headline of 'Broadband levy may be trebled for homes with multiple lines'. Hardly headline grabbing stuff as we believed from the time the Digital Britain report was released that the tax was to be levied on a per telephone line basis, rather than a per household basis. Therefore those with 2 lines will pay £1 a month, and those with half a dozen, £3 a month. The data suggesting 1.7 million homes have 3 or more lines seems a little unusual as one of the big advantages of ADSL is that you do not need a dedicated telephone line for it so home owners still retaining a second or third line for Internet access are already wasting monthly line rental of around £10 to £12 a month (unless they have multiple broadband lines). The most likely answer is that these dedicated lines are actually rented by and paid for by businesses for home workers where a firm wants to give employees broadband, but wants them to only use it for business purposes.
On the issue of Virgin Media telephone lines, some reporters and even the odd Minister or two thought these were immune as they were fibre optic based, however, they have always been intended to be included in the levy. The wording in the Digital Britain report was such that it covered all metallic telephone lines, and while Virgin Media makes great use of fibre-optic in its advertising, the reality is that the telephone line to the home is supplied over a twisted pair copper cable running alongside the metal co-ax cable, and thus will be subject to the tax. Those Virgin Media customers who will not have to pay the tax are those taking a broadband and/or TV package but not a telephone line service.
What needs clarifying rapidly by the people responsible for the Finance Bill is the latest leak from the Treasury reported by The Times, that VAT will be levied on top of the tax, thus increasing the cost by some 17.5% (assuming VAT returns to this level when the tax starts). We know that low income groups will have various exemptions applied, which is welcome, but at a time when the government is spending a few million to encourage Internet participation, many of these people will be annoyed to find their bills going up to pay for something that at this time they have no interest in.
ZDNet UK has hit upon one major problem for how the Digital Economy Bill will handle copyright infringement. The short version of the plan is that copyright holders, can notify a provider of an alleged infringement, and the provider is then meant to match this up with the customer involved and keep a record of the number of strikes. Then at some point in the future the copyright holder can apply for the actual information that identifies the violators, the presumption being that they'll go after those with the most strikes.
With fixed line broadband this is relatively easy. Providers keep records of who was assigned what IP address from their IP pool at a specific time, and the tools the copyright holders will use will also see these IP addresses. Alas the situation is different for mobile broadband. Put simply the mobile broadband providers have a limited set of public IP addresses, and map a number of users to one of these IP addresses in a similar fashion to how a broadband router shares one public IP address between multiple computers in a home.
This means that while copyright holders will know the public IP, this will not uniquely identify the mobile broadband connection that was used. Mapping is not impossible, but it seems that on a day to day basis the mobile broadband providers do not do this (although they may have resources to do so on a small scale, e.g. for abuse and police investigations). With the millions of broadband dongles now in use the UK, creating a system to track all of these and the issue of Pay As You Go services adds to the complexity.
Of course it may be that the media industry is willing to overlook the mobile broadband market, but while it may not be used widely for copyright infringement now, if those exploiting the system become aware of this they will simply move to the mobile services, making it an issue. To some extent the data allowances on mobile broadband make it less attractive for file-sharers, but 15GB a month is an awful lot of music tracks. Lets not forget that Napster was big back in the days when most people still had dial-up. There is also the disparity between the advertising telling us that mobile broadband is fast and great, but when they want it to appear slow and less useful compared to fixed line broadband the tune changes. 3 certainly appears to have people making heavy use of their service, hence the introduction of traffic management.
Looking forward to services like LTE/4G one presumes the mobile industry will resolve this NAT like architecture, since once they introduce lower latency solutions people will try to do more things like connect games consoles and other devices that may not like the restricted access that is common at present. Some of the early satellite broadband providers had similar problems, but we assume the next generation being launched now have resolved this, though no matter how good the bandwidth is to and from a geostationary satellite very little can be done about the massive distance the data travels, which kills latency sensitive applications such as gaming.
Directories listing the various UK radio stations that have a live online feed are nothing new, but the BBC and commercial radio have revealed a joint venture entitled UK Radioplayer that should mean that people listening to radio online will be able to jump around stations while staying within the same radio player.
The press release tells us that the pop-up console will be able to stream over 400 stations, which will be a mixture of licensed national, local, community and student radio stations. A key feature would appear to be the search functionality allowing people to look for specific types of shows and music. A BBC blog has a video demo of what some of the features embedded within the console will be. These include support for advertising, programme sponsorship and other interactive content. The radio player, while initially limited to personal computers, will in later releases support smartphones and IPTV set-top boxes.
As with projects like Canvas, this project will require approval from the BBC trust. Approval is not a foregone conclusion, the Canvas project is still in the balance with opposition from some broadcasters not involved in the 'open' project.
Having met earlier in November 2009 the Business, Innovation and Skills Committee has heard further evidence relating to Digital Britain and the Universal Service Commitment and Next Generation Fund.
Ed Richards, CEO of Ofcom outlined what they view as the three key factors
people take into account when buying broadband,
The industry regulator placed great emphasis on the speed research it carried out earlier in 2009, which given it did not cover ADSL2+ fully is perhaps now looking out of date, and as a guide for the buying public may mislead. The biggest problem with speedtesting is that a test done today cannot predict what speed you will get tomorrow, thus while one ISP may have performed better during the testing in the first half of 2009, another may have improved its performance as more capacity has been purchased, or more likely a good ISP may have got worse.
The Minister Stephen Timms appeared to get a harder time in front of the committee with them pushing for the minister to actually define what the 2Mbps Universal Service Commitment (USC) actually means. The closest we got seems to be that virtually all households will get a line capable of 2Mbps at some point during the day. In other words it is the connection speed, not the speed you will see from a download in the evening. The danger here, particularly with the bidding process, is that the lowest cost bidder who offers on paper a good solution might be making the cost savings by using higher contention and thus the performance when the kids are home from school and people are not at work is so bad that even basic video streaming may not work. The committee was informed that the definition of the USC will be done by the Network Design Procurement Group, with the staff of this being appointed early in the New Year. This means the time frame to define the service, and accept bids and actually start work will be very tight if the deadline of 2012 for all those without broadband now to have a USC meeting service will be met.
The broadband levy/tax was covered, with the confirmation that those who have a Virgin Media cable broadband service, and the associated telephone service, will be paying the levy too. It was also heard that those with a telephone service over a pure fibre connection would have to pay. Exemptions for a number of low income groups will exist, but the Finance Bill will provide the detail. An interesting issue is that those warning that the tax may not finish when 2017 arises may have had their fears further enhanced, as it was suggested the tax may continue to fund further coverage.
What was interesting to observe was the disjoint between the level of certainty over where the commercially led Next Generation Roll-outs will go between Ed Richards and Stephen Timms. The minister seemed to be more sure that commercial roll-out will leave around a third of the country on first generation services, where as the Ofcom chief was less sure, citing examples of what a game changing effect TalkTalk had on the LLU market.
Time for all those living in Essex, Suffolk, Norfolk, Cambridgeshire, Bedfordshire and Hertfordshire who are interested in Next Generation Broadband to put their hands up and fill in the web form at http://www.erebusonline.org.uk.
The site is funded by the East of England Development Agency and exists to assess demand for Next Generation Broadband, with the results being made available to providers who want to provide a service in the area. The aim of the site is to identify how much demand there is in the region and use this when chasing for funding from business and the EC for the EEDA to assist the Next Generation roll-out. Maps of where others have put their pin are expected to be appear in 2010.
There is no guarantee that the map will result in fast broadband coming to an area, but with the possibility of a Next Generation Broadband fund via the 50p levy, for an RDA to know where the demand is that has not been met already by commercial roll-out may help to target funds so that more people benefit quicker.
Unlawful file sharing is getting feathers ruffled and has led to Stephen Fry tweeting about it.
Dear Mandy, splendid fellow in many ways, but he is SO WRONG about copyright. Please sign and RT http://is.gd/50gQK #webwar #threestrikes
Copy of tweet from Stephen Fry
TalkTalk has also been vocal releasing a statement on Friday in its ongoing campaign. The Digital Economy Bill is far from an easy read but to summarise, no-one will be identified to a rights holder without the requirement for a court order, and secondly it seems the rights holders are expected to take action against the people they choose to pursue in the courts, rather than the default being an Internet disconnect. There are powers that the Secretary of State can use to change this procedure.
This sounds very like the current system, the major difference is the obligation on the ISP to pass on warning letters (which is where mis-identification is possible) and retaining records of who got physical letters from whom. The difference is that when an ISP is required by court order to identify the customer, the rights holder will then have information on many instances of copyright infringement. The mass of information is the key and it means if someone loses a case the fines could be very large (imagine £500 for each track). Assuming that cases of single infringements are not taken to court then random errors and hacking may be less of a concern.
The Digital Economy Bill does allow for technical measures with talk of temporary disconnects, but more as a measure of last resort, and we would presume that if rights holders bend the ear of the Secretary of State, then we may see these measures being forced on providers. The progression is not as simple as the five steps currently outlined by TalkTalk on its site, but these are waiting on an update to reflect the new bill. The provider has started a Number 10 petition, but on reading the petition one can see how a political answer is possible stating that the Bill has measures in place to ensure innocent people are not disconnected.
TalkTalk has published a manifesto making pledges to its
customers:
Point 1 is actually part of the bill, and most providers quietly get the court orders and respond to them. Very often the court order is to identify a number of users with an ISP. Of course the bill does not appear to cover a rights holder or law firm acting on their behalf going on a phishing expedition (i.e. asking for many more users details than it needs to help build its own database of people for possible future legal action). On Point 2 there is some 70 days of business before the next General Election must happen, so there is a possibility that if the Digital Economy Bill proves contentious that it may not make it onto the statute books by the General Election. On Point 3, the key point is alleged infringement. As a customer, TalkTalk is not giving customers carte blanche to infringe copyright, simply stating that it wants to see things go through the courts. For those serial infringers, a simple Internet disconnect is likely to be less painful than a large fine from a civil court and the surrounding publicity.
As things stand we have what looks to be an Internet industry lining up against the rights holders ready for a playground face-off, when in reality they should be trying to engage and provide ways for consumers to consume media without infringing copyright. The complete lack of a new definition for fair use fit for a digital age in the Bill is a major disappointment. Broadband has been a game changer in allowing people access to material in a similar way that the ability to record a performance and play it back again which started in the 1870's did. The difference with that technology was that it was not until the 1950's that the 7" single market became large. Broadband has moved at a pace far faster and trying to bend a fast moving beast to fit a mid 20th century model is going to be difficult and maybe impossible. The media industry is making some moves, but invariably the limits restrict what devices you can play material, even when you have notionally purchased it.
The biggest concern among many people will be the backstop powers that lie with the Secretary of State. If these powers become law, the potential for politically motivated action is entirely possible. For example, without the need for any judicial processes providers might be forced to disconnect for one month those who receive 20 notifications in a two year period. Or whole websites/services may be required to be blocked, e.g. if overseas VPN connections are identified as proving popular with serial copyright infringers providers may be forced to block access to any VPN outside the UK.
The Digital Economy Bill stretches to some 60 pages and continually refers to the earlier Communications Act 2003 making it a hard read for a Friday. Digging into the document reveals that there is provision for sharing of the costs that will arise from the new rules on managing copyright infringement.
15 Sharing of costs
After section 124K of the Communications Act 2003 insert-
"124L Sharing of costs
- The Secretary of State may by order specific provision that must be included in an initial obligations code or a technical obligations code about payment of contributions towards costs incurred under the copyright infringement provisions.
- Provision specified under subsection (1) may relate to, in particular-
- payment by a copyright owner of a contribution towards the costs that an internet service provider incurs;
- payment by a copyright owner or internet service provider of a contribution towards the costs that OFCOM incur.
- Provision specified under subsection (1) may include, in particular-
- provision about costs incurred before the provision is included in an initial obligations code or technical obligations code;
- provision for payment in advance of expected costs (and for reimbursement of overpayments where the costs incurred are less than expected);
- provision about how costs, expected costs or contributions must be calculated;
- other provision about when and how contributions must be paid."
Extract from Digital Economy Bill
The costs of passing on all the infringement letters and maintaining an accurate database of past infringements has been raised by various broadband providers since the original Digital Britain report, the Bill would appear to offer a cost sharing solution, but it seems it is down to the Secretary of State to control whether this sharing takes place. Interestingly Ofcom will be able to have its costs from its involvement paid for by copyright holders and providers.
While reducing copyright infringement is something that must be addressed, there is the danger that the methods used will actually cost more to run than it creates in extra revenue. At this time there is little sign of any extra revenue streams for broadband providers. The largest providers may benefit from partnerships with music labels to bundle a music subscription with their service, but for those providers with less than a million users they do not have the negotiating power to get a good deal from these sorts of deals. Thus, at the end of day we may see the price of broadband creeping up to cover the extra costs, or those people who do buy music and films will see media costs increase to cover what the media industry must pay.
For many people the Digital Economy Bill was thought to be a piece of legislation that would layout who and how the Universal Service Commitment (USC) would work, but to perhaps many peoples surprise the USC is not part of the bill. The funding of the Final Third Project to get Next Generation Broadband to the areas of the UK that the commercial firms will not venture was always going to be part of the Finance Bill due to the need for legislation to introduce a tax raising regime.
So where does the USC stand? Well for one that USC is NOT about giving everyone 2Meg download speeds but rather 'to ensure, through a Universal Service Commitment (USC) that virtually every household in the UK can get access to a line capable of delivering at least 2Mbps'. The word virtually was in the original report but often ignored, it is there so that the difficult areas can be provisioned with something more economically viable. It is important to be aware it is talking of a line that can manage 2Meg, not sustain 2Meg at peak times, or put another way, the many people who complain on our broadband Not-Spot mapping system of slow throughput even though connected at 2Meg or faster will not benefit from the USC. The money to pay for the work required to meet the USC will be from the surplus funds in the Digital Switchover money pot, which is thought to be around £200m. Two hundred million sounds a lot, but if one accepts that there are 166,000 properties unable to get broadband in the UK, which is a figure often mentioned, this works out at just £1200 per property.
Given the spread out nature of many broadband black holes, we think people should be prepared to accept satellite broadband services, or the under trial 'BET' (Broadband Enabling Technology) system from Openreach. Where a cluster of five or six properties exist with no broadband, then more advanced possibly even next generation systems may be possible, particularly if the homeowners/businesses are willing to pay something towards the install fee.
While 2Mbps can be considered fit for online banking and access to e-gov services, the increasing amount of video available for purchase online means people with 2Meg lines will feel like second class broadband citizens. In four years time we may find that operating system updates occupy an hour or two a day on a 2Mbps line (Microsoft Windows service packs can already weigh in at 200 to 400MB in size).
The USC was an opportunity to take the already world leading broadband coverage in the UK, and put the UK in a position that would stop people worrying about the state of broadband access when relocating a home or business. As things stand now, it is impossible for us to say who people will go to to ask questions about the USC, or exactly what the options will be for people. In theory, this information should emerge very soon if the USC is meant to be completed by 2012, but the reality is that we will probably see the mechanisms in place in 2011 ready for 2012 and those with no broadband benefiting possibly in time for the 2012 Olympics.
Today 20th November 2009 sees the content of the Digital Economy Bill announced, with the various sections available and assorted comments by members of the Government on the BIS website (warning some parts of the site appear slow at the time of writing this (10:45am)). We have split the bill out into its constitute parts to make it easier for people to digest, and avoid confusion.
One thing to ensure people are aware of is that while some press coverage has suggested the 50p broadband levy/tax is not happening, and while it is not part of the Digital Economy Bill, it is expected to be detailed in the Finance Bill at a later date.
Copyright infringement and how to make copyright laws fit for a digital age was a corner stone of the Digital Britain report, and by far has been the issue generating the most vocal response from the public and industry. Today clears up some of the confusion, but of course until the Bill has entered the statute books it is open for debate and change.
Compared to what has been covered in the press previously the proposals in the bill seem somewhat more targeted at those who engage in copyright infringement the most, rather than resulting in people who have downloaded one music track getting letters and their broadband cut off. How well the letter warning system will work depends greatly on how good the rights holders are at identifying people; the general public will not take kindly to being accused of sharing content illegally if they really have not. Therefore, the rights holders need to take great care in not abusing the letter system. Additionally, one hopes that the bill on its passage through the house will cover the issue of privacy, i.e. that the tally of bad marks held by the service provider is kept securely and is not used for marketing purposes (e.g. customers with too many bad marks receive a poorer service or are encouraged to move to another provider to reduce a providers costs in handling the letters). In light of the mobile phone company staff selling customer records, the issue of security and privacy for this data should be high on the agenda.
Of course the hope with this legislation is that people will reduce the amount of material they download illegally (i.e. free) and spend more money on buying the content legally. The digital economy is apparently worth some £16bn and copyright infringement is estimated to cost the music industry £180m and the film/TV industry £150m in lost revenue. In the current economic environment it seems unlikely that people will spend more on music and films rather, they will simply decide to live with less digital content or seek free legal means to obtain/view it.
The Sony PS3 Network has now added a movie store, and while not the first console to offer full films it perhaps offers the largest files. The store can be previewed at videostore.uk.playstation.com and carries films in both SD and HD formats from twelve film studios.
The films are around 2GB in size for SD quality, with HD films weighing in at around 9GB. Prices range from £2.49 to £3.49 and whilst the rental allows you to keep a film for 14 days on the console, it will expire within 48 hours from when you first started watching it. Purchases appear to range from £6.99 to £11.99.
The HD service would just not have worked in 2000, when a HD film at the quality level Sony is using would have taken almost 2 days to download over a '0.5 meg' service; even today it will take around five to six hours on a line that can support '4 meg' downloads, and that's ignoring any peak time congestion. In an ideal world you would want to be able to download the film in about the time it would take to drive to the nearest DVD rental store and get back home, making a strong case for '20 meg' and '50 meg' broadband services. Currently in the UK apart from a few apartment blocks with fibre/Ethernet, maybe 5 to 10% of ADSL2+ users, and Virgin Media XL and XXL customers, quick downloads of HD film are fantasy.
To encourage people to try out the new service, Sony is offering the Transformers movie for download to those registering a Playstation Network account on a new Sony PS3 until 30th November. Existing network users, can buy Angels and Demons and get a voucher for The DaVinci Code.
The Christmas period could prove very interesting this year, as with the schools on holiday and probably many firms taking extended holidays there may be lots of people at home playing games, watching movies or using the various free streaming services on the games consoles. At least by using downloads, while it might be frustrating to wait for a download to complete, it does play content as a download rather than streaming it, so buffering is not an issue. (You can enjoy buffering if you want to, by electing to play the video while it is still downloading). Also the PS3 is not tied into only downloading a film; background downloads are supported, but we do not recommend trying any online gaming with a large download underway.
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