Mandelson sets out action plan on illegal P2P

Internet connections of the UK's illegal file-sharers will be blocked from the summer of 2011, Lord Mandelson has revealed. In a speech this week, the UK business secretary said that tough action was required to prevent profits in the creative industries from eroding in a haze of unauthorised peer-to-peer (P2P) activity. He also unveiled a series of steps that will work towards 2011, and outlined the role that communication regulator Ofcom will have in the plan.

Addressing a forum of the Creativity and Business International Network (C&binet) – a non-profit group backed by the Department for Culture, Media and Sport – Mandelson said: 'The export earnings of the UK creative industries alone are worth about £16bn. That's about 4% of UK exports. They employ almost two million people in our economy.' The internet, he added, has ensured that 'industries have a greater ability than ever to reach new customers, to speak to them directly and to tailor creative goods to them, their needs and their tastes'.

Turning to IP tensions between the creative and online worlds, he said: 'The creative sector has faced challenges to protected formats before and it has survived robustly – in spite of some Cassandra-like predictions from inside the industry. Home taping didn't kill the music industry. Home video didn't do for movies. But the threat faced today from online infringement, particularly unlawful file-sharing, is of a different scale altogether.

'I was shocked to learn that only one of every 20 tracks downloaded in the UK is downloaded legally … You just can't have sustainable creative industries under the pressure of this kind of theft – and that's what it is. So I want to be absolutely clear: The British Government's view is that taking people's work without due payment is wrong and that, as an economy based on creativity, we cannot sit back and do nothing as this happens.'

In order to combat the rising tide of infringement, the government has scheduled a new Digital Economy Bill for a Parliamentary reading in late November. Likely to receive Royal Assent in spring 2010, the Bill's measures will be enforced by an Ofcom code of practice. Ofcom will also set up an appeals body, monitor the effectiveness of enforcement efforts and make revisions to the code as necessary.

Rights holders will work with internet service providers (ISPs) to identify persistent infringers, and enforcement will unfold over a three-stage process of escalating seriousness. Once identified, an infringer will receive an initial written warning from the relevant ISP, followed by a warning of legal action if infringement continues, then formal legal papers if the problem persists.

Linklaters IP partner Marianne Schaffner, an attendee of the forum who works with media and leisure clients around the world, said: 'These recent legal developments must be welcome, as they constitute the first step to ensure that the value of innovation and the investments made by the creative industries are preserved, and their IP rights can be better enforced.'

In Schaffner's view, though, wider action should be taken at an international level. 'The internet has no borders,' she stressed.