Think of how much traffic (which is also ad revenue) they would have gotten if they would have made a deal with the Olympics. Imagine a freely accessible database that could show in HD every Olympic event. It would become the standard for referring back to the Games. And also generate LOTS of revenue.
Just because YouTube isn't directly paying for the content, doesn't mean they just take the work of others and exploit it. They are offering am excellent, free, and highly accessible distribution platform for all sorts of content. Just because the content producers can't leverage that doesn't mean YouTube is evil. It means they have an open forum that some people abuse. Just like a park where someone sells weed. Don't sue the city, arrest the kid.
And, they project profitability this year. So you may be proven wrong in the near future.
The game of basketball does not allow you to carry the ball down the court. The rules of the game state that you must dribble the ball. If you try to break these rules, the ref will shut you down (in theory). If they don't, and you do in fact travel and get away with it, it's called bad officiating not cheating.
The rules in a video game are defined by what you can and cannot do in the created world. If you can throw a grenade after you die, then a glitch has occurred and the rules of the game must be revised with a patch. Same principle as a ref who doesn't call a traveling violation.
Copyright infringement and illegal drug trafficking is a little different. One kills the nation's youth and one kills a bloated, outdated middleman. I wouldn't argue for copyright reform by comparing file sharing to drug use.
"Actually, I would have thought that ANY stringed instrument would be fairly easy to recreate - after all, it is not too difficult to simulate a string vibrating. Percussive instruments are also easy."
Actually, these instruments would be very difficult as well, because there are an infinite number of ways to strike, stroke, pluck, push, pick, or otherwise interact with a string or percussive instrument. There are at least as many ways to interact with a string or percussive instrument as a brass or woodwind.
in Beverly Hills here is a panel discussion on piracy. Your boy Jim will be there, and you can ask him these questions in person. I think it would be good information, and I would like to read a rundown of what goes on (as I cannot attend myself).
But the price of a concert ticket is not fixed, it is potentially infinite depending on the demand to see the artist. It is theoretically possible to make and infinite amount of money from only playing one show, as long as the demand for that one show is insanely high. Using this model, it is easy to see how 'good' artists (ones who create a high demand) could be rewarded more than 'bad' artists (ne who do not create a high demand).