Five of Australia's largest ISPs have today put forward a detailed proposal to deal with the issue of illicit file-sharing. The paper proposes the implementation of a warning letter process, but unlike the 3 strikes-style regime in neighboring New Zealand, would not include an Internet disconnection sanction. Instead, rightsholders would head back to the legal system to punish persistent infringers.

In common with many other countries around the world, in recent years Australia has struggled with the issue of unlawful file-sharing. The messy and still-unfinished legal battle between AFACT and ISP iiNet has further highlighted the rift between rightsholders, the Internet industry and its subscribers, and their often conflicting needs.

But now a joint proposal from the Communications Alliance and ISPs including Telstra Bigpond, iiNet, Optus, iPrimus and Internode, with collaboration from telecoms company AAPT, Ericsson Australia and the Internet Industry Association (IIA), lays out what the contributing parties believe is a workable middle-ground.

The 14-page proposal, titled ‘A Scheme to Address Online Copyright Infringement’, puts forth the framework for a “Notice Scheme” which aims to educate Internet subscribers when their connections are flagged as engaging in copyright infringement.

Unlike schemes elsewhere, particularly in neighboring New Zealand, there is no ‘graduated response’ being proposed by the ISPs for dealing with persistent infringers – that means no throttling, suspensions or disconnections. Instead, a warning notice scheme “with a strong emphasis on educating consumers” would be put in place, operating as follows:

The responsibility for monitoring file-sharing networks would fall at the feet of rightsholders who would only be able to do so using pre-approved and tested systems. Notices would have to be sent to ISPs within 14 days of an infringement being logged and ISPs would then have another 14 days to match the provided IP address with a customer account and send out an infringement notice.

Subscribers being contacted about a first instance of illicit file-sharing would receive an ‘Education Notice’ noting that an infringement had taken place on the account, but would not mention the content of the material that was shared. It is not clear why this omission was put in place, but one might imagine that those sharing pornography would be pleased at the inclusion of such a safeguard. The notice would also include information on where to obtain legal content.

After receiving an Education Notice, a 12 month period would then follow where if a subscriber was caught infringing again they would receive a ‘Copyright Infringement Notice’ (CIN). This time the content shared would be detailed in the notice.

When an account holder has been sent an Education Notice and three CINs, their ISP would then send a new notice called a ‘Discovery Notice’. These would note that the account holder has been unresponsive to previous notices, that rightsholders have been informed of this fact, and that further action could follow. It is at this point that the rightsholders would have to decide whether to get a court order to obtain the identity of the account holder in order to sue them under existing legislation.

At every step of the way, from Education, to Infringement to Discovery Notices, subscribers would be given opportunity to appeal.

“We believe the Notice Scheme can greatly reduce online copyright infringement in Australia, while protecting consumer rights, educating consumers about how to access legal online content and helping rights holders to protect their rights,” said Communications Alliance CEO, John Stanton.

“Equally important is the need for rights holders to ensure that consumers have access to legal and affordable content online, to reduce the motivation to source content in ways that might be illegal.”

Stanton notes that Australians have turned to illicit file-sharing because accessing material through official channels often means a wait of months compared with the release schedules of the rest of the world

“This difficulty, combined with a proliferation of access technologies, such as file-sharing software, has reportedly seen a growth in the frequency of unauthorised access to online content and breaches of copyright laws,” he notes.

The ISPs propose that the scheme runs for an 18 month trial to be followed by an independent evaluation on whether it has successfully influenced consumer behavior and if any changes should be made.

At this point some readers might be thinking that the proposals appear much more reasonable than those seen elsewhere, but it should be noted that while the ISPs may have thrown their ideas into the ring, they are just that – their ideas.

The other side of the debate – the rightsholders – aren’t mentioned as being party to these proposals even though the Communications Alliance statement says that the education-based Notice Scheme “flows” from discussions held during 2011 between ISPs, the government, and rightsholders.

And there are always problems. When one looks at the number of warnings the ISPs are offering to send out they are fairly limited. No ISP party to this proposal will be required to send out any more than 100 in a month, and all ISPs combined aren’t offering to send out any more than 10,000 total throughout the entire 18 month trial. Further, the thorny issue of apportioning costs is yet to be hammered out and they will be substantial.

It will be interesting to see what the likes of AFACT have to say about the proposal. On track record they will want any agreement balanced more in their favor and the above will be just the starting point for their negotiations.

Full details of the proposed scheme can be obtained here (pdf)