The Digital Economy Bill, which requires internet service providers (ISPs) to disconnect users who are accused of illegal filesharing, will cost consumers up to £500 million, the Government has estimated.
The Bill, which is expected to become law next year, will add £25 a year to the cost of broadband, according to ISPs. The Government’s impact assessment document, which examines the likely effects of the Bill, estimates that around 40,000 households will give up their broadband connections entirely to avoid the higher fees.
The impact assessment, written by Lord Young, of the Department for Business Innovation and Skills, and Lord Davies, of the Department of Culture Media and Sport, estimates that the measures in the Bill will result in an extra £1.7 billion for the entertainment industry over the next ten years. However, over the same period, it is estimated that consumers will pay between £290 and £500 million extra as ISPs pass their increased costs on to consumers.
Jeremy Hunt, the shadow culture secretary, told the Times newspaper: “It is grossly unfair that Labour expects millions of innocent customers to pay extra each month because of the actions of a minority. By their own admission this will make broadband unaffordable to tens of thousands of people, which flies in the face of Government policy to increase take-up in disadvantaged communities.”
ISPs have been vocally opposing the Bill for some time. BT described the measures as a “collective punishment”, while Carphone Warehouse called on the entertainment industry to pay for the measures, rather than consumers.
The Digital Economy Bill, championed by Lord Mandelson, requires ISPs to send warning letters to customers who are accused of illegally sharing files. If the letters are not effective, the Bill authorises further measures, including capping download speeds and disconnecting users entirely