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superchunk said:
i hate drm's.

I could be wrong, but I believe that DRM is entirely unnecessary and most industries focus on it really hurts their bottom line.

Filesharing (and other inexpensive and easy to use file distribution methods) have created a very weak barrier to entry for the average person to steal content; an inexpensive internet connection and a little information is all you need to gain access to anything.

How should content providers respond to this?

In my opinion they should be focusing on an easy to use, inexpensive way to deliver content to people which is easy to take advantage of; iTunes is a good start but is (in my opinion) too expensive and they should focus on $0.10 to $0.25 songs and $2 to $4 albums. If you're spending small ammounts of money to buy content that is easy to find it is unlikely that you will bother to steal it.

How do content providers respond?

They focus on DRM which is proven to be impossible to create; for those who understand cryptography, you are essentially attempting to create a cryptographic system where the person you want to receive the message can not receive the message. They do this to ensure that they can continue to chart $80 for a season of a television show, $20 for a CD and $25 for a DVD.

 

As I said before, I could be wrong but I suspect if the cost was small enough (almost) everyone would pay for their content and they would (probably) spend more money and have very large, ecclectic libraries.