Sweden’s IPRED law creates a market boom in VPN services

by Steve Ragan - Apr 8 2009, 16:10

Last Wednesday, according to Swedish news portal The Local, Internet usage dropped 30 percent thanks to IPRED (Intellectual Property Rights Enforcement Directive), the highly contested anti-piracy law, which took effect in Sweden on April 01. As a result, there has been a spike in the sales of anonymity services, such as VPN.

IPRED allows courts to issue mandates to ISPs, ordering them to turn over information that would completely identify anyone suspected of file sharing if there is sufficient evidence of alleged illegal activity. While there is no real word on where the burden of proof lies in the Sweden courts, in U.S. cases it seems to always fall to the defendant to prove their innocence.

While the aim is to stop illegal file sharing, what’s to prevent record companies or other IP (Intellectual Property) holders from simply flagging blocks of Swedish IP addresses as suspect, heading to court for an order that forces the ISPs to release their customer information, and then suing them or forcing exorbitant fines?

As the law was set to take effect, Swedish consumers considered VPN services, and once the law went into effect, sales of VPN and other services went into overdrive as consumers reacted by seeking to protect themselves.

Some would argue this is merely the reaction of criminals attempting to hide from the law. Yet they would be wrong, as normal users are looking to use VPN as well.

Perhaps the most famous of the anti-IPRED services is the one offered by Pirate Bay. The VPN service from Pirate Bay, called IPREDator, launched at the same time IPRED took hold in Sweden.

Pirate Bay says that IPREDator, “is a network service that makes people online more anonymous using a VPN. It costs about 5 EUR ($7 USD) a month and we store no traffic data.”

As mentioned in our previous coverage of IPREDator, the services Pirate Bay plans to offer will help those who share pirated materials to shield their IP addresses. However, anyone who wants to remain anonymous online can pay and use the service as well. So assumptions and reports claiming that the new VPN offering is only for criminals is misleading.

The questions that remain are ones that lawmakers will argue against. Do we need legislation to make a half-attempt at curbing piracy? Does piracy really cost companies and copyright holders as much as they claim? And is illegal file sharing an issue of morality or an issue of poor business models?

As seen in the past, no matter how many laws are pushed forward, someone will always share a file with someone else online. The majority of the time these files are legal, while at other times they may include the trading of new Hollywood releases. The problem with all these laws is that they treat those who share files legally as criminal.

In the case of IPRED, the law is said to target the big fish, but will it always be that way? How long will it be before sharing one or two files makes someone a big fish? In the U.S., people have gone to court over a handful of files, while others trade them by the thousands.

The Local summed up the piracy debate nicely in its report, saying: “File sharing is no longer a bit of anarchic internet fun, it has got nasty.”

Still, what happens when a law like IPRED comes to America? Let’s hope we never find out.

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