[PeterisP]

As an anecdote of how DRM hurts sales of DVD's - many of my friends now have 2-5 year old kids.

All of them bought a bunch of kid movie DVDs legally. All of them don't buy legal DVDs anymore as they are a bad quality product compared to downloaded movies:

1) The original discs get scratched quickly and they don't know how to back them up (as they are allowed by law but disallowed by DRM) - if the kids ask to "repair the movie" it is simpler for them to download & burn a fresh copy of the movie they bought, rather than try to break the DRM (again, breaking the DRM is explicitly legal here).

2) The original DVD's contain unskippable ads before the movie. It's defective by design - especially if you want to limit your kids exposure to that brainwashing. Pirated DVDs provide a better viewing experience.

So, a lot of people who would be perfectly willing to pay $$$ for many, many movies got hurt by the substandard product. If the content providers had legally sold the 'piratebay-style' DVDs at the same price, they would get their money.