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Memorandum submitted by Motion Picture Association

 

I am writing to you regarding the Business and Enterprise Committee's current inquiry into broadband speed and the Government's target for universal access to broadband at 2MB/s announced as part of the Digital Britain Report earlier this year.

 

I understand that during a recent meeting with NBC Universal, one of our members, they raised the issue of a connection between broadband speed and illicit peer-to-peer (P2P) file-sharing and how this might impact upon the outcome of your inquiry. As the trade association representing the six major producers and distributors of film and television programmes, we thought it might be useful to pick up on this issue in a little more detail.

 

Digital Britain sets out an ambitious vision for the future of the digital economy in the UK and the film industry stands ready to play its part in helping Government realise that vision of a thriving market for digital content. In our view tackling rampant unlawful activity online is essential to that vision becoming a reality.

 

Consumers are now using the internet to download more films, TV shows and music than ever before. A recent Ofcom report into UK adults' media literacy found that one in three UK adults who use the internet now say they are watching online or downloading TV programmes or films[1].

 

 

However, this increase in traffic on the network slows down access to the internet for all and a lot of this traffic comes from illegal peer to peer activity. Illegal traffic uses up a significant amount of bandwidth - more than half in the case of some ISPs[2]. This in turn limits the capacity available to others and makes the delivery of a universal high-speed service less likely.

 

In other developed digital markets estimates of the proportion of capacity taken up by illegal traffic range between 50 and 75 percent[3], meaning that just 25% of internet capacity is available for use by the lawful majority. This is one of the reasons why most consumers do not have access to the level of broadband speed they are paying for. A study by Ofcom earlier this year found that fewer than one in ten (9 per cent) of a sample of 8Mbit/s headline packages received actual average speeds of over 6Mbit/s and around one in five (19 per cent) received, on average, less than 2Mbit/s. [4]

 

It is clear therefore that reducing illegal P2P file-sharing goes hand-in-hand with improving broadband speeds for UK consumers. In the current climate, the incentive for ISPs to invest in developing the network is being undermined by the fact that, as things stand, the new capacity created will simply be taken up by more unlawful activity.

 

The unauthorised distribution of content through P2P programmes also increases the spread of viruses and can cause significant damage to home and business networks. Symantec estimate that 90% of the files shared through P2P applications contain malicious software (malwares) and in 2008 10% of malware were propagated via P2P applications.[5]

 

Further, as outlined by a recent study by McAfee[6], the number of new file-sharing sites illegally hosting copyrighted material has increased by over 300 per cent over the last three months. In particular, this has occurred since a Swedish judge ordered ISP Black Internet to cut off bandwidth service to BitTorrent tracker site The Pirate Bay. McAfee predicts the number of these malicious sites will increase during the blockbuster film seasons. Not only will these websites increase traffic on networks and further facilitate the spread of viruses and malware software, but McAfee's research demonstrates the current difficulties in preventing unlawful file-sharing.

 

Putting appropriate measures in place to reduce illegal behaviour online means that capacity will be freed up for legal use, an improved and safer service will be created for consumers and a business environment which encourages investment and innovation will be delivered.

 

This will become increasingly important as ISPs seek to develop the next generation of 'super fast' broadband networks. We feel that those developing these new networks should already be considering how their construction can maximise opportunities for those in the creative industries, particularly content owners and creators, to promote the delivery of legitimate content. It is imperative that this new infrastructure does not become merely a system of delivery for unlawful content, which will further detract value from ISPs, content creators and rights holders.

 

I hope this information is of interest to your inquiry. I would be delighted to meet with you to discuss the issue in further detail at your convenience if this would be helpful.

 

18 November 2009


[1] UK Adult's Media Literacy 2009 Ofcom (http://www.ofcom.org.uk/advice/media_literacy/medlitpub/medlitpubrss/uk_adults_ml/adult_ml.pdf)

[2] Swedish crackdown on piracy reduces file-sharing The Swedish Wire, 4th Aug 2009 (http://www.swedishwire.com/general/648-swedish-crackdown-on-piracy-reduces-file-sharing)

[3] Ibid

[4] Fixed-line Broadband Speeds Ofcom (http://www.ofcom.org.uk/media/news/2009/07/nr_20090728)

[5] What do P2P Applications do? Symantec 13th Oct 2009 (http://www.symantec.com/connect/articles/what-do-p2p-applications-do-and-how-block-peer-peer-applications-p2p-using-symantec-endpoin)

[6] McAfee, Threats Report: Third Quarter, 2nd November 2009 (http://www.mcafee.com/us/local_content/reports/7315rpt_threat_1009.pdf)