When you think about this, it's obvious. In fact, online piracy could be used as a strategy by record producers and movie folks to eliminate piracy altogether. But would anyone listen to the idea? And would there be anyone visionary enough to even dream up the concept?

Let me outline the architecture and strategy that the music industry could deploy today. It would cost less than the horrible current strategy of lawsuits and futile threats.

STAGE ONE First of all, the Motion Picture Association of America and the Recording Industry Association of America have to let the online file sharing go nuts. Cut it loose. Let all the users do what they want. You won't know the extent of the problem unless you let it surface and go crazy, just as happened with Napster years ago when millions of people were trading music on the system.

STAGE TWO Let the rampant online file-sharing world impact and ruin the organized pirates who sell CDs, DVDs, and other purloined-content items. It should make their profitability fall enough that they will all disappear. Let's face it: They are already working on a thin margin. A high-quality counterfeit DVD typically sells for $2 in Indonesia. This has to include pressing, smuggling, distribution, markup, and payoffs. How much profit can there be? They obviously make most of their money from sheer volume. Any impact on that volume, and these folks will be looking for better things to do.

The unintended consequences of file-sharing piracy are thus witnessed.

STAGE THREE Now this is the hard part, because while the hard pirates might be eliminated, the soft pirates (aka file sharers) will be going nuts. This is the time for the industry to study the actual impact, since file swapping will be out of control. If it turns out that soft piracy results in increased sales—as was the case during the Napster era—then you just stop the program and let the situation continue unabated. At least you'll know whether or not the Napster thing was just a fluke. If sales continue to decline and the movie industry, too, can see an impact, then you'll know that file trading is bad for business, and now you can actually prove it. Until now, the industry's complaints have been hot air.

I actually believe that allowing open file sharing to take place will indeed increase sales, and that people still like owning the real thing. Most file sharing is done in an effort to find out what is out there to buy. Radio stations used to provide this service, but they no longer do. But for the sake of argument, let's say that the RIAA and the MPAA can show that this trading actually does hurt business. They could continue the process thus:

STAGE FOUR Let file trading do a market-share climax. Typically, if given a chance, a market will emerge, whereby one or two file-sharing systems will become dominant. It's almost impossible for this not to happen. So you let it happen and let the dominant players emerge while the others just die.

STAGE FIVE You co-opt the leaders. You buy into the companies, or simply buy the companies. You can do this with all sorts of rationales. You can say that this is the future of the business and you need to be part of the action. Or you just form an investment consortium consisting of all the major players and the RIAA and MPAA, then start buying them out one after another until you own them all. Let's face it: These people will sell.