A number of industry groups and ISPs have claimed that the cost of Peter Mandelson’s plan with regards to illegal file sharers would cost more than the savings that would be made for the entertainment industry.

In a recent about turn it was announced by Lord Mandelson, the Business Secretary, that the three strikes rule relating to illegal file sharers would be going ahead, and it has been reported that broadband users that engage in this activity could start being disconnected by 2011. However, some industry groups and Internet Service Providers are now stating that the cost of implementing the plan will actually amount to significantly more than the savings that would be made by the entertainment industry.

The entertainment industry has complained that it is losing two hundred million pounds a year because of illegal file sharing, but reports claim that the cost of implementing Mandelson’s plan would come to around four hundred and twenty million pounds. Recently Mandelson has stated that “ISPs and rights-holders will share the costs, on the basis of a flat fee that will allow both sides to budget and plan.”

There has been a lot of critisim over Mandelson’s idea about funding the plan, as many think that this will amount to a lose-lose situation. It is thought that ISPs will have to push up the cost of broadband for those that do not illegally file share in order to cover their financial contribuition to the plan, and rights holders will end up spending as much as they claim to be losing because they also have to contribute towards the cost of implementing the plan.

An official from a streaming website also expressed his concern about the plan, stating: “This morning at the government sponsored Cabinet forum Peter Mandelson backed a tough three strikes policy for file-sharers, echoing the hard-line position taken in France. This is a move which is directed at protecting the media industry and copyright law but one which entirely misses the heart of the issue.”

Source – Guardian