Since it first exploded into the mainstream in the mid-1990s, the internet has challenged traditional forms of media production, ownership and distribution.
Online versions of newspapers were one of the earliest examples of this shift.
Then came the battle between the "big six" music companies and Joe Internet User, which came to a head in the infamous legal action against Napster. Big Business won that battle - but may have lost the war. The geeks got cleverer (of course) and brought out new ways of downloading that didn't depend on a central server. They invented the bittorrent.
While Apple showed the music industry how it could capitalise on the internet as a major distribution channel, the front-line of the internet community showed smart users how to get music for free. Few cared that copyrights were being breached. Indeed, the left-leaning, front-line internet community generally believes that copyright law is immoral, favouring only greedy publishers and distributors -- not artists, as it was originally intended (see for example this interview with Lawrence Lessig, evangelist of the Creative Commons initiative).
So, the media industry won the first battle -- but it may be losing the war. This time people are downloading movies, not just music. Pirate copies of movies (usually filmed off a screen) become available for free download in torrent form as soon as they are released in theatres. When the first DVD appears, a high-quality torrent will find its way online.
Indeed, torrent creators typically use better compression technology (MPEG-4) when copying DVDs, so the torrent version of a movie may fit onto a CD, with no perceivable loss in quality.
Little wonder then that the entertainment industry are urging us to upgrade to High Definition (HD) DVDs and TV. But, wouldn't you know it, those cheeky internet chappies have managed to make torrents out of HD movies too...