The New York Times (reg. req.) has written an article on the different approaches that pornography companies are taking with regard to P2P (The Pornography Industry vs. Digital Pirates). The responses range from "It's direct marketing at its finest" to tactics similar to those used by the RIAA. This is not surprising, however, due to the fact that music and pornography industries are structured very differently. After all, no one would be surprised that book publishers aren't going after filesharers, since ebook sharing isn't nearly as big a threat to book publishers as music sharing is to music publishers.
On of the key paragraphs for me was near the end of the article:
Pornography merchants say that they have the advantage over free file-sharing networks, at least for now. They say the networks are not well suited to the needs of their consumers, who like images and movies that push their very specific buttons for, say, blondes or cheerleaders.
Basically, you can still sell porn despite free P2P versions because there are other barriers to access that a legitimate site can easily overcome. Unlike MP3s, for example, images and many pornographic videos on P2P networks have atrocious metadata. Because MP3s are relatively metadata rich, it is easy for someone to search for particular artists or songs. If you had to rely solely on filename (as much pornography must), it would be much more difficult to find the music you want.
As the paragraph notes, people are often interested in particular types of pornography (i.e., foot fetish, smoking fetish). Finding such images would be as difficult as searching music only by genre. You can find it, but the search is much more burdensome than searching for specific artists. I think radio, for example, helps reduce search costs for music. There is no equivalent of radio for pornography.
Anyway, pornography and music are different markets and their responses to filesharing will be different. However, there are lessons for the music market. Number one, convenience is worth money. A site that can make it easy for me to find music I will like and get that music for me when I want it is more valuable than an inconvenient, hit-or-miss P2P experience. As a porn entreprenuer says:
"Free is very anarchistic and hard to deal with, and you don't know what you're getting," said a pornography entrepreneur who goes by the online pseudonym T. Lassiter Jones. "Cheap is more convenient."
The formula for the record companies to survive is simple: raise the cost of using P2P networks (through lawsuits, bogus tracks, etc.) and provide convenient, inexpensive legitmate access to music. Once the cost of the legitimate source is less than the costs associated with P2P, then P2P will no longer be a major threat. Percentages might fall, but the overall market will likely grow.
In this model, DRM is a mistake. DRM does not significantly raise the cost of P2P (the music gets on the network anyway), but does decrease the value of access to authorized music files.
It works for pornography.