whilst i agree with point 1., society opperates by dealing with the issues society dictates.
the issue exists - and there is a logical way of dealing with it that can serve well the purpose of company, artist and consumer.
the argument actually slightly differs to your point above IMHO in that it is "why should i pay a price i consider not to represent value for money when i can get it for free?"
as i said, most art consumers are also art lovers (granted there are exceptions, and they should be stopped) and dont want to see the industry disappear
there are some good models out there, such as spotify, that give you limited ammount of comsumption before you have to buy - this kind of model seems the way forward.
So, complicated arguement, because
- You can get it for free by doing something illegal
- It's not only about music/movies, and people argue one point while stealing other stuff, e.g. software.
Re the entertainment industry, consumers need to drive it by the choices they make
- buying a CD is a stupid investment, as is the iTunes music model
- Subscription based services, ala Rapsody, Zune, etc are much better deals, but people don't make informed decisions. Don't ask Hollywood to make more original/interesting movies when a part 7 part 2 movie makes hundreds of millions of dollars.