It's actually sort of interesting, because the music industry now basically works on a model of "pay us if you want to, you can get the product either way", whether they admit it or not.
Supply and Demand gets interesting when the supply is set to infinity

edit: And you are right of course as regards industry attitudes. THe problem is they based their entire business on controlling the distribution. When that control was taken away, it turned out, they didn't have a backup plan, because they never expected to do anything else.