rationalskepticism.org

This fight is, in my opinion, a mirror of the War On Drugs (TM). The most expedient way to shut down an operation is to target those who are running it, and attempt to stop them from doing so however you can. Targeting individual users is an extremely time-consuming and unwieldy method of fighting either filesharing or drugs, as their sheer number (coupled with how long it takes to prosecute people for anything) precludes wiping out the operation this way. However, targeting the "dealers", in this case the uploaders, is difficult because they are ensconced in layers of protection. Neither strategy is likely to scare anyone into stopping. The best way, then, to fight this problem is to attempt to ameliorate it with intelligent intervention, addressing the fundamental issues which motivate people to do it. In this particular case, it means altering your business model to make the prospect of buying the music/movies more appealing; in other words, allow people to buy copies of the film, DRM-free, for a reduced price. That will appease most of the "moderate" users who would prefer to buy but dislike DRM, dislike having to buy and convert a DVD to have the file on their PC, or dislike the price.

It's not a perfect solution for distributors and studios but it looks to me like it's the best and quickest way to address the problem without alienating anyone, and without endless lengthy legal battles.