Intellectual property counsel, Nancy Prager, has an insightful article on CNet-

Since the Napster 1.0 days, people who have chosen to transfer creative content unlawfully over the Internet have used a litany of excuses to justify their behavior. The most popular excuse seems to be that only large corporations suffer from the lost sales. Recently, file sharers have claimed that they are opinion makers and style influencers.

Contrary to popular belief, digital file sharing has a direct impact on independent artists as well as major label artists.

Now, not all instances of piracy constitute displaced sales, and thus lost revenue, yet intellectual property critics will prattle on that piracy has no negative effects. To the contrary, any "benefits" of piracy are so limited that piracy should never be encouraged or sanctioned. Widespread piracy does not lend to innovation, consumer welfare, online freedom nor free culture, its simply theft.