That's crazy that someone went to jail for running TPB when the MPAA and RIAA are big monopolies that control how much we should spend on stuff. It's not a free market. Get your head out of the sand.
The only reason the iTunes model has come to exist is because of torrents and illegal sharing.
And people (myself included) buy a lot of stuff from the iTunes Store now.
Netflix exists because of illegal sharing. And even though Netflix is pretty awesome, look at what all the established companies are doing to try to screw with Netflix.
Such a narrow view.