Communications Alliance says ISPs yet to receive funds from Government’s $131 million package

Attorney-General George Brandis says the Government is assisting internet service providers (ISPs) to comply with mandatory data retention laws by providing $131 million in funding, but the Communications Alliance says ISPs are yet to see the funds.

“The Government is assisting, particularly the smaller industry participants, by providing, as I said, $131 million to enable them to adjust their business practices to be compliant,” Senator Brandis said.

“This is an important national security obligation.

“We do frankly expect the industry to assume a large part of this burden.”

Um, what’s metadata again?

Start by thinking about making a mobile phone call.
What you say on the phone is the content. This is not metadata.
The time of your call, who you called, how long the call lasted and which cell tower your phone contacted are all logged, traditionally for billing purposes. That information is metadata.

But a report by PricewaterhouseCoopers shows the money on offer to ISPs will not meet all their costs for implementing the Government’s mandatory scheme.

The PWC report, which was commissioned by the Attorney-General’s Department, has found the upfront cost of the metadata retention regime is between $188.8 and $319 million.

While most of the money has been set aside for ISPs, Communication Alliance chief executive John Stanton said none of the funds have been paid out.

“Zero [has been spent] as far as I know,” he said.

“The Government has come up with a draft financial model and is going to consult with industry on that I believe later this month.

“Service providers are having to commit to investment decisions to implement the process and the systems to meet their requirements without knowing how much of that spending will remain unfunded.

“We certainly think the money ought to have been apportioned by now.

“Really, we shouldn’t be six months down the track with this level of uncertainty about that aspect of the scheme.”

The level of uncertainty is highlighted by a survey from the Communications Alliance, which has found that two-thirds of ISPs are either “not confident” or only “somewhat confident” that they fully understand what metadata the Federal Government wants them to collect.

Senator Brandis said the requirements are expressed “clearly”.

“The obligation is expressed very clearly in the legislation,” he said.

“If there is confusion among some members of the industry then I suspect that’s a question better directed to them.”

The majority of ISPs not ready

ISPs have had the past six months to plan how they will comply with the law, but 84 per cent say they are not ready and will not be collecting metadata on time. More on what the survey found:

More than two thirds of ISPs are either “not confident” or only “somewhat confident” that they fully understand what metadata the Federal Government wants them to collect and store
84 per cent of ISPs are not ready to retain and encrypt the data as required under the Act
While many ISPs have lodged a Data Retention Implementation Plan, only a small subset (about 10 per cent) have been approved
There is a huge variance in estimates for the cost to business of implementing data retention – 58 per cent of ISPs say it will cost between $10,000 and $250,000; 24 per cent estimate it will cost over $250,000; 12 per cent think it will cost over $1,000,000; some estimates go as high as $10 million
A majority of ISPs, about 61 per cent, are requesting exemptions or variations from parts of the legislation, for example, the requirement to encrypt retained metadata

The figures came from the Communications Alliance’s survey which was sent to ISPs.

Mr Stanton said he is not surprised that the vast majority of ISPs missed the deadline.

“Not surprisingly there’s a pretty low state of readiness for the data retention regime that comes into force today, with many service providers still confused about exactly what’s required of them and the vast majority of them not able to be compliant on day one,” he said.

But Senator Brandis has defended the regime’s rollout and said ISPs will not be penalised or prosecuted for not being ready.

“We are working closely with industry to make sure that there is full compliance with the obligation,” he said.

“There is an 18-month period commencing from today during which companies which are not compliant as of today, which is six months after the legislation came into force, are able to apply for an extension of their compliance obligation.”

Greens senator Scott Ludlam, who has long been a critic of the legislation, has called the metadata retention rollout a debacle.

“My overall concerns are we’ve got a scheme that is costing in exccess of $300 million that is formidably difficult for industry to implement, that may bankrupt smaller ISPs, that can be defeated in about 60 seconds by downloading an app that costs less than a dollar,” he said.

Source: ABC News