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Record company representatives met with ISP executives during last week's London Calling conference in an attempt to reach an agreement that would convince the government that it does not need to legislate to force ISPs to take action against alleged sharers.

"A market solution is always going to be better because you have something to control," one executive told Digital Music News. "Once it's a government solution, you are just a child."

Feargal Sharkey, chief executive of British Music Rights, which represents several composers' and publishers' organisations, says that these preliminary talks are a reason to be optimistic.

"Three months ago these guys wouldn't even get into the same room," he said.

Digital Music News says that among ISPs, BT Tiscali, Carphone Warehouse and Virgin have all been involved in talks. Carphone Warehouse's involvement, if true, is somewhat surprising, and may justify Sharkey's optimism: in April its chief executive Charles Dunstone said he was not interested in policing the internet on behalf of the music industry. Virgin, by contrast, has already agreed

Whatever agreement is reached or - failing that - when the Government intervenes, significant questions remain to be answered. Identifying sharers remains very much a hit-and-miss (more miss that hit, it would seem). In the US, where record labels have been suing alleged sharers for many years, courts have yet to rule categorically on whether sharers can be definitively identified simply from the presence of files in shared folders on their computers. And last week the Motion Picture Association of America which represents Hollywood studios admitted that proving that file sharing took place is nigh on impossible.

"It is often very difficult, and in some cases impossible, to provide such direct proof when confronting modern forms of copyright infringement, whether over P2P networks or otherwise," it wrote in a court briefing. "Understandably, copyright infringers typically do not keep records of infringement. Mandating that proof could thus have the pernicious effect of depriving copyright owners of a practical remedy against massive copyright infringement in many instances."

And even if you can be sure that files were shared by a particular computer, identifying the user is not straightforward, particularly if the computer is shared by a household.

The music industry has so far avoided giving direct answers to these questions, insisting that its methods for identifying sharers - methods that it won't reveal - are reliable.

Becky Hogge, executive director of The Open Rights Group, doesn't think so.

"Solutions which attempt to to detect whether data that moves across a network is doing so in breach of copyright law - either by attempting to identify the content of that data or by attempting to identify the type of traffic (e.g. p2p) are too subject to error to be realistically and proportionately used for enforcement purposes," she said.