As ISPs and rightsholders continue to fight over who will pay for Australia's "three strikes" anti-piracy regime, there is still no sign of when the program will begin. Nevertheless, Village Roadshow co-founder Graham Burke is already looking ahead - to the day when his company starts suing Aussie downloaders.

After years of wrangling, on September 1, 2015, Australian ISPs will take the historic step of implementing a new anti-piracy scheme, one that will see Internet users issued with escalating warning notices designed to bring a halt to their pirating ways.

Well, at least that was the plan when a draft anti-piracy code was laid down in April. Almost predictably, however, that deadline will come and go without event.

The problem – and this will come as zero surprise to those who have followed this process for the past several years – is one related to costs.

Money, money, money

Since the beginning of negotiations, rightsholders have insisted that ISPs should pick up varying percentages of the bills incurred when sending piracy warnings to their subscribers. Equally, ISPs have insisted that if rightsholders want notices sent out, they should be the ones to pay.

This dispute has brought the parties to deadlock several times during years of negotiations, and has derailed talks completely more than once, most recently in 2012. However, this year – with the government breathing down their necks – rightsholders and ISPs agreed most aspects of how the notices would be handled, but left the issue of costs until another day.

That day has now arrived and still there are disputes. With the launch of the scheme supposedly just next week, ITNews reports that during an industry briefing this morning it was revealed that the parties are still arguing over who will pay for the 200,000 notices set to go out in the scheme’s first year.

For their part, rightsholders think that the ISPs should help with the costs, in part because it is their customers carrying out the infringements. They also believe that if ISPs foot part of the bill, they will be keen to keep costs down.

On the other hand, ISPs insist that if the notices prove effective in cutting piracy and driving up sales, rightsholders will get the benefit so should therefore pay the bill.

Countering, rightsholders also point to the bigger picture, one in which ISPs are increasingly becoming the conduit for providing entertainment content to subscribers.

“As ISPs increasingly become content providers, the business imperative to make sure people are valuing those services will become more and more important [to them],” says Foxtel director of corporate affairs Bruce Meagher.

So how much is the whole thing likely to cost? According to figures obtained by ITNews, there is dispute there too.

Too expensive to reduce piracy?

ISPs say that the bill could amount to $27 per IP address targeted, while rightsholders suggest that the figure would be more like $6. A report commissioned by the parties earlier this year concluded that the cost will be closer to the $27 suggested by the ISPs.

That cost is too high. As previously seen in New Zealand, “strikes” schemes with high costs are rendered pointless.

“We saw that in New Zealand where the government mandated $25 per IP address, and no-one used the scheme,” Meagher says. “We’ve got to work out a way of setting a price that encourages the scheme to be used.”

If in doubt, send the lawyers out

But even though agreement could take a while to reach, there are those in the entertainment industry already looking ahead to what might happen once people start receiving warning notices. Speaking with SBS, Village Roadshow co-founder Graham Burke says that if the notices don’t prove enough of a deterrent, legal action will be the next step.

“Yes, [piracy] is wrong. [Downloaders] have been warned, and sent notices that they’re doing the wrong thing. Yes we will sue people,” Burke said.

Asked by interviewer Marc Fennell whether there is any fear of a backlash should the industry start suing single parents and grandmothers (as they have done in the past), Burke dismissed the concerns.

“It was really just a couple of instances of a bad news day, where [the press] picked up a couple of instances of a single pregnant mother,” he said.

But would just a couple of those stories prove damaging?

“Not if it’s seen in the context that it is theft, and they have been doing the wrong thing, and they’ve been sent appropriate notices, and they’ve been dealt with accordingly. We’re certainly not going to be seeking out single pregnant mothers,” Burke said.

Confronted with the likelihood that some people will simply hide their activities by using a VPN, Burke played down the fears.

“I think that if people are appealed to in the right way, they’ll react appropriately,” he said.

Site blocking

Finally, after site-blocking legislation was passed earlier this year, Burke has now confirmed that his company will take action soon.

“We are going through the legal preparation at this stage and will be ready in October to go to the courts and ask them to block sites,” he concludes.