The explosion of broadband coupled with the growing amounts of bandwidth consumed via P2P file-sharing systems has begun to cause concern for ISPs. So much so that a growing number are now aiming to clamp down and cut costs, which could end up being a double-edged sword.

Major music labels and Hollywood blame the emergence of file-sharing networks such as Grokster, Kazaa and eDonkey for opening up a black market trade of copyrighted materials that's eating into their business.

ISPs say that as much as 60% of data traffic zipping around their networks is in the form of large music, movies and software files. For a large ISP, the bandwidth costs needed to accommodate the traffic could run into the millions, if not tens of millions of dollars per year, experts say.

British technology start-up CacheLogic estimates the global cost of file-sharing to ISPs will top £828 million in 2003, an expense that will nearly triple next year.

"What the ISPs are spending on bandwidth is one of their greatest capital expenditures," said Andrew Parker, a co-founder of CacheLogic.

The escalating bandwidth costs associated with file-sharing are not sending the ISPs' broadband services into the red, but the firms are anxious to bring it under control.

"It is a potential problem. It's something that we need to manage quite sensitively," said Pierre Danon, chief executive of BT Retail, a division of BT.

Ironically it's the very popularity of online music and media that helps to draw broadband customers in, making the situation into a double-edged sword.

But many industry watchers say the "all-you-can-eat" formula for selling broadband is coming to an end. According to Jupiter Research, nearly 60% of European ISPs have either instituted or are considering instituting bandwidth limits on data-hogging customers.