The UK High Court has ordered BT to bear the cost of blocking access to pirate content aggregator website Newzbin2 within 14 days as well as any future IP addresses associated with the site.
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BT estimates it will cost £5,000 to adapt its Cleanfeed website filtering service and £100 for each site that needs to be blocked.
BT is also required to pay most of the legal costs for the case, expected to be a six-figure sum.
The order in the case - brought by a group of US film studios - spells out how far BT has to go in carrying out the High Court's initial ruling on Newzbin2 in July, which was hailed as setting an important precedent.
In making the initial ruling, Mr Justice Arnold required the parties to submit proposals on how to control access to Newzbin2 so he could make an appropriate order in October.
The July ruling represents the first time a UK court has ordered an ISP to block a specific website due to concerns about piracy.
The precedent will make it easier for content producers to bring similar proceedings against internet service providers (ISPs) such as BT, who enable access to copyright-infringing sites.
This is likely to change the way copyright infringement battles are fought in future, with rights owners seeking injunctions against ISPs instead of tackling infringers directly.
The High Court's order means that rights-holders are the clear winners, having been handed a powerful weapon to police UK access, though ISPs, to infringing websites, says Ian De Freitas, a partner in the intellectual property team at law fim Berwin Leighton Paisner.
"However, they will still need to exercise a degree of caution in not being seen to unduly interfere with freedom of access to the internet. This remains a live issue in the continuing challenge to the provisions in the Digital Economy Act, which ISPs are now taking to the Court of Appeal, having been given permission to do so earlier this month," he said
On 7 October 2011, the Court of Appeal granted permission for BT and Talk Talk to appeal the High Court's earlier judgment in April 2011 rejecting their challenge to the Digital Economy Act (DEA).
Under the DEA, ISPs such as BT are required to provide greater assistance in policing infringements on the internet. The Court of Appeal has ordered the appeal be heard speedily, recognising the importance of a definitive ruling on the challenges.