Is this the future for legal P2P?

I'm not sure whether the cloud or the silver lining is more dominant in this particular story. The background is that of internet service providers, the "content" industry and the vast swathes of naughty people illegally downloading and uploading content over P2P networks.

To sum up the story thus far, the big ISPs have been dragged kicking and screaming into an agreement with the BPI music industry association. A key element of the agreement is that everyone's going to work together to try figure out some new business models for music distribution (the other key bit is ISPs agreeing to send threatening yet toothless letters to those users they suspect of infringing upon copyright). These new business models are likely to involve a monthly subscription fee, tacked onto the ISP's usual bill.

Now, according to paidContent:UK, a legal P2P company called Playlouder MSP is in negotiations with one of the big ISPs, with a view to launching just such a service. Good stuff, shurely?

But here's the catch.

The idea, it seems, is for the ISP to use deep packet inspection (DPI) to monitor all the user's P2P activity – it uses this, along with a system called Audible Magic, to identify which songs are being acquired or sent, thereby figuring out which record label needs to get paid, and how much. The system would see pretty much all P2P sharing between subscribers made legal. At the cost, however, of being permanently snooped on.

Where to start? Firstly, does this mean this mystery ISP will be using DPI on all its users, whether or not they subscribe to the service? How will the ISP know who on a user's account is actually doing the P2Ping? As with the BPI agreement, what actually happens to non-subscribers who P2P naughtily? Do the smaller indie labels get their dues, or is it just the majors and the big indies? And, somewhat crucially, will the system really work on a technical level?

Hard to tell. Today's attempts to contact Playlouder have failed. I've called all the big six ISPs and nobody's willing to cough. Personally, my money's on Virgin, although they haven't said anything other than this: "Virgin Media is in talks with a number of content providers on an ongoing basis. We have made no secret of the fact we believe a commercial proposition is the right thing in the long term. If and when we have something to announce, we will."

Hmm.

Well, we shall see. A service like this really does need to appear, and soon. I'm not so sure DPI's the way to go about it, though. Is it not too much to ask to simply have a subscription service that gets discreetly tacked onto the standard ISP package, that allows unrestricted P2Ping on an anonymised basis? I'm not saying it's that simple – if it was, it would be happening already – but there has to be a way forward that doesn't involve perpetual invasion of privacy.

Oh, and that does justly compensate the artist. It's a minefield, I know.