The way I see it, the economics of publishing are entirely backwards right now. A creative producer, who wishes to distribute their goods to the masses, should look for a distributer in a competitive market. The current system is that the distributer looks for creative producers, and filters out lots of artists that it doesn't think will be successful. This is as absurd as a trucking company looking to nurture manufacturing businesses so it has more things to ship.
Let's consider the issue of pirating. It's not a false dichotomy to state there are two kinds of pirates. The kind that can afford the item they are pirating, and the kind that can't.
If someone pirates an item because they can't afford it, the producer isn't losing any potential income, because the pirate has none to give regardless. Stamping down on this kind of piracy is pointless.
If someone pirates an item they can afford, however, then you've got problems. What this indicates is that someone found pirating to be more convenient than the legal way of buying the item. Would people really buy more items instead of pirating them if it was more convenient and pleasant to buy the item legally? Steam certainly indicates so. Take a look at the thousands of Reddit comments on steam. One of the remarkable themes that emerges from those comments is this kind, "Downloaded this from Steam, even though I already own the CDs, because I didn't feel like looking for them" or "Bought it on Steam after I torrented it". (If you don't believe me, seriously, look for youself. Also note that Reddit users are basically the demographic of people who pirate out of convenience.)
What this indicates is that traditional publishing as done in the film, book, or game industries haven't been keeping pace with the consumer's desire for convenience. You can blame an uncompetitive market for that. If creative producers were able to select from a gamut of publishing companies and evaluate cost versus effectiveness of sales, etc., then publishers would be forced to innovate. And also to offer better deals to artists.
Of course, the established industry is resistent to change, which is why we are getting all of this DRM. They are approaching the problem of downloading for convenience in exactly the wrong way. Instead of trying to make purchasing games, music, movies, and books more convenient (like Steam has done with games) they are trying to make pirating less convenient. Guess which approach would be more efficient, but would actually take some thought and overhaul of the current system? Amazon is moving in the right direction with the Kindle.