>The same exact mechanism is in play in music (fans who go to gigs & buy swag etc. subsidise music for the masses who hardly put a penny in it), and many other parts of the economy.

This is correct; income from services like Spotify are pitifully low. However, it highlights an important distinction between two types of movie piracy: cam-rips of movies currently playing in the theatre, and "normal" piracy, which is of stuff available through retail. The thing with music is that you can't pirate a live band performance: there's very rarely anything comparable to a cam. For one thing, too much of the value of a live performance comes from the experience. Second, it's usually too difficult to capture such a performance as an ordinary audience member. (Official recordings released after the tour are different, of course.)

While I, like some others here, don't believe in intellectual property at all, I do think that artists should be rewarded for their work. Until we can get a better system, I question the ethics of taking something for free when you are in a position to easily pay for something of equal or better quality. So I personally have never torrented anything that was playing in theaters, and I think that's a principle one could reasonably stick to.

However, I think there's a striking difference between what you might call "performance rights", and right to copy. In the latter case, while I think it still makes sense to give the artist some recompense for their success, the situation is in fact much different. Other people regularly make these points, so I'll only mention the top few most relevant for me:

* It's usually impossible to rent / purchase a movie at home at watch it instantly without DRM. Many movies aren't available for streaming at all.

* Quality is usually quite bad when streaming. Even if you get lucky and can get 1080p or above (which means you're not a Firefox or Chrome user watching Netflix), the encoding quality of the film is usually quite bad.

* Even if you have a video rental service nearby, and they have the movie you want to watch in Bluray, you then need to have a Bluray player to watch it (more DRM), as well as hope you have the latest AACS keys, or that your player can download them in a reasonable amount of time if you do not. (Even then there are quite often encoding problems on Blurays, which pirates take the time to fix more often than not.)

In other words, the value proposition of pirating retail products is pretty good. You can instantly (or nearly so) watch a larger selection of films in higher quality than you can get through any other means, with no technological limitations. I think in this case, the value of compensating artists is outweighed by the competing value of the incredible increase in convenience and quality that piracy represents to the public.

None of this is to say that compensating artists isn't important; the problem is that the current system for compensating them sets up a whole bunch of competing values. While your "fireworks" analogy probably works for films in theaters, it doesn't exactly capture the realities of the retail market for films. That reality is that we need a better system for distributing movies that makes it possible to compensate artists without neglecting other values.