Doing the Numbers on Copyright Violations
Lets just say the music industry estimates that 400 squillion illegal files have been shared over the Internet and that ever last one of those files represents a lost sale to the industry. That would make music about the most profitable business since slavery. However, for the same reasons, the music industry has seen not a vast increase in its income, but a net loss of around 6% a year for the last few years.

The psychological problems here are vast; these guys are comparing where they are with where they know they should be if weren't for all the pirates.

Now any sensible person (note: illegal rhetorical device) will realise that many of the files being shared were never going to replace sales anyway. Partly because it would entail the music business growing at unprecedented rates, but mostly because the people listening to them, if they had to pay for them, wouldn't listen, or couldn't afford to listen.

But now ARIA, the Australian equivalent has started talking some genuine economic sense in this piece in the SMH (expires)

While Australian music sales dropped last year, the Australian Recording Industry Association (ARIA) concedes that online song-swapping and CD burning may not be to blame.

Exactly, and why?
Piracy not the burning issue in CD sales slide: ARIA
ARIA chief executive Stephen Peach says "I think it's important to recognise that there are other legitimate commercial pressures [on music sales],". (Give that man a medal)
Mobile phones, especially with texting capabilities are a source or recreation as well as communication and by March 04 75% of Aussies may have one.
A record $180 million was spent on interactive games in December 2002 alone. (money taken from the whimpering mouths of music industry execs)
Music video/DVD sales were up 150%+ last year to 2.45 million copies.
According to RIAA's own figures, after constantly increasing the number of new releases through the '90s, new music releases in the US fell by 31 per cent to around 27,000 in 1999.
(Hmm, less product variety, 31% fewer titles to buy, so where was growth supposed to come from here? Everyone whop doesn't buy 2 copies is stealing from the industry?)
In August last year US-based Forrester Research contradicted RIAA's claims, saying consumers who frequently download music and burn CDs still buy 36 per cent of all CDs in the US. "While 13 per cent say down-loading will decrease their music purchases, 39 per cent say exposure to new music online increases their CD buys,".
"One thing everyone seems to agree on is that online music downloading is the future saviour of the industry and will help it back to growth."
(Not this pixie. The time of the "music industry" when profits were generated and protected by high barriers to entry, duplication and distribution is GONE. They are squabbling over the giblets and they wont disappear completely, any more than hod carriers have gone from the building industry.)