Does piracy in fact kill music?

Anders and myself started to argue about this in another thread, but I think it's more than important enough to warrant it's own thread. In fact, this topic was recently covered by Scott Adams, and can be found here.

I think his post is right to the point, so I'll use some of it to start off the discussion. Here is a summary of Adams' post:

• For successful musical artists, file sharing does little in terms of increased publicity, since they are already famous, but hurts their record sales.
• Many citizens happily adopt a pay-per-song policy, but many, many more would rather not pay at all.
• Proponents of file sharing argue that for the not-so-well-known artists, file sharing can be leveraged to promote a career in music without necessitating backing from a record company, because the publicity leads to more asses in seats for live performances.
• How many concerts have you attended over the last year because you heard an artist's music for free over the internet?
• How many concerts by artists who got famous the old-fashioned way have you attended the last year.

What really irks me is the flimsy rationalization from file-sharing proponents, like a) "we're only taking a small fraction of the already too large profit of big music corporations", or b)"bands like Metallica are just greedy bastards who make way too much money anyways." For a) you have to be an absolute imbecile to be unable to connect the dots between a financial backer, artist revenue and the ability to keep releasing records using high-quality equipment. For b) it ain't up to you to decide whether or not an artist or a record company is making too much money. Especially seeing as how you in fact have no idea what the financial situation of said enterprises is to begin with. But for almost everyone, there exists a subsection of the population who feels that you make too much money.

Please don't be that guy (or gal) who tries to justify downloading/file sharing with moronic logic such as "I don't feel that file sharing is a crime, because I don't want to subsidise Big Corporations who push out a million identical artists but refuse to back True Individuals." At least have the cojones or whatever to admit that you're stealing stuff - don't make it into a Holy Crusade for All that is Righteous. Speeding is also a crime, but most would admit that they do it without throwing a Christ complex into the discussion. Don't even try to tell me that filesharing is noble - just man up to what you're doing. If you make a copy of your own CD and play it in the car, or you rip your CD collection for personal use, and if you put mp3s of your entire CD collection on a hub with 1000 users, we're talking about two quite different things - if you don't see this as separate issues (also in accordance with Norwegian law, actually), then don't even bother.

Some other facts/arguments that might be brought to light in this discussion, but which are typically drowned by strong partisan reasoning: You can identify at least three separate economies for artists based on their size/fame. The primary variables in these economies are CD/DVD/download sales, merch sales, and live performance revenue. Note that these variables are interrelated, so seeing them as separate doesn't make sense. Merchandise and CDs get moved at concerts, etc.

• The well-established artists on major labels, with large fan bases. These artists make a lot of money on both front and back end of CD sales, but lose money/pray to break even on live performances if viewed separately. This is mainly due to the fact that if Rolling Stones go on tour, they bring along 2500 yes-people, 150 trucks, 30 sound engineers, 250 stage hands and roadies, 10 managers, 15 drug dealers, 50 guitar and drum techs, 17 yoga masters, etc. Payroll expenses alone kill the profits for the sheer live performance on big tours. They DO however generate lots of publicity and move merch and CD/DVDs from touring.
• Medium-sized artists with a record deal could be in the zone where they're between markets, and so a few thousand CDs not sold could make the difference for whether they're able to make a living from music. This could probably go either way, though.
• Minor players, especially those without a record deal, can totally benefit from "free" advertising on NRK Urørt" and general file-sharing, as they don't make any money from CD sale. Recording and distributing is freakin' expensive, and so CD's and downloads are used to propel touring/gigging as their source of revenue. A small band bringing along like two people can make an ok living from touring, but there's no way they'll move enouch CD units to justify upscale recording/producing/distributing costs.

Three separate economies based on the size of the bands - and my feeling is that a LOT of artists are in the middle bracket. I know that this is the case for many, many metal artists, who probably won't be able to live off of music if the CD sale goes further down.