Virgin Media is trialling a scheme that will identify whether its broadband customers are illegally downloading.
The ISP is using Deep Packet Inspection (DPI) to identify the type of traffic (email, web surfing, gaming etc) a broadband connection is being used for.
Any file-sharing activity will be then be checked against a database of music and films.
According to Detica, which is working with Virgin Media on the system, it can identify whether the download is simply family photos or a music album, and if so the artist and title.
However, the IP address - which would identify the customer that is taking part in file-sharing, is currently ignored by the system.
Virgin Media told The Times the "technology hasn't been designed for that" in regards to identifying illegal downloaders, and instead allows the ISP "to understand the exact nature of unlawful traffic on our network".
The ISP hasn't ruled out identifying the IP address using the technology in the future.
This would help to implement Lord Peter Mandelson's proposals to tackle internet piracy, which will see repeat offenders booted off the web after receiving warning letters.
Virgin also said it wasn't breaking UK law as a the customer remains anonymous.