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The whole piracy thing is just making me think big time about what digital goods value is.  It's simple:

Digital goods are worthless.

There I said.  With the internet, digital goods cannot be commoditized because the supply of digital goods are, in theory, infinite.  Back when I worked in Ticketmaster, I learned that people were not able to price tickets properly, therefore secondary markets were created in the form of auctions of exchanges.  You had scalpers essentially acting as middlemen for other middlemen.  But the key concept in why tickets and events have value but the music itself no longer has value is because tickets and events are finite in number.  Rolling Stones are some of the biggest sellers because they are legends and you don't know when one of them is going to pass away from an overdose.

Software now is worthless because companies like Google or trends like Open Source Software have made supply infinite.  You can't compete with the cost of zero.  It's like trying to force people to pay for air (now that's a scary thought for colonies on Mars or the moon!)

Traditional companies like media companies must realize that to commodify goods like video, tv, or music they must start examining the approach of the tech industry.  Companies like Oracle, WebLogic, etc. sell to large players with deep pocket books not because they have great features, but because they offer support contracts that large companies can afford.  However, if you look at the trends going on with the software industry, those situations are more of the exception than the norm these days.  People are more and more moving towards ad based models or service/support based models in software to make a profit.  JBoss, for instance, makes great money because their service/support contracts are expensive.  IBM has moved much of their business from the hardware based aspects to a support role.

If these situations hold true, then how should the big media companies attempt to handle piracy?

• Ad based models.  It's worked with radio and TV, it'll work online.  Just don't geotag so that everyone can equally view TV.
• Movies need to focus on theaters as being a social event, not as the chief form of making a profit from blockbusters.  In America, at least, people are moving towards home theaters, so working with electronics manufacturers, online video stores, and ISPs to deliver high quality rental movies to home's large plasmas and whatnot should be the goal.
• Musicians should focus on events as being their chief form of revenue generation.  The good thing about this is that it'll kill off wannabe musicians who are produced (i.e. Milli Vanilis, etc.) and focus on people who have true talent, thus being worthy of receiving money from playing at venues.
• The cost of digital media must go down MASSIVELY.  I've written about this before and have shown a better pricing model than the one existing.

The big thing is that big media companies should stop making enemies.  Why do you want to insult the intelligence of your consumers?  Why do you want to treat them like mindless slaves?  Why do you want to treat them like a foreign invader?  Consumers are your obvious best friends and you need to do MORE for them.  It's a large part of the reason why the airline industry is dying in America.  You need to service the consumer.  People expect good service for what they pay.  If you examine closely to what I'm saying about software, the two key components of the success in recent models for the software industry are support and service focus.  Remember AOL's debacle with their customer sales rep trying to retain a customer using a script?  Do you know why I refuse to fly any American based airlines anymore and go mainly with asian airlines? 

The key is the service people!!!!!!!!!!!!

I know that the media industries are controlled primarily by a certain group.  I won't say which to offend them, but they know whom they are.  The thing is that you can't keep ripping people off and expect to have loyalty.  This is not a war, but if you want to make it a war, the consumers will fight back slowly and surely.