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In today's Washington Post, there was an article about the legal online music file trading sites. It seems that lots of people aren't all that happy with the legal alternatives, since one site won't have the same selection as the other site, site A will only sell the entire album, site B has Public Enemy, but only the B sides.
"It is fairly easy to buy a song, but it can be much harder to find a song worth buying. That is why unauthorized services, such as Kazaa and LimeWire, still have millions of users, despite the music industry's lawsuits designed to stop unauthorized sharing."
Throw this in with the normal business wrangling (royalities, advances against sales, etc.) and it's small wonder that this is not going anywhere and the less than legal places are flourishing.
-- Update --
And just in time to help muddy the waters, the RIAA files another smattering of lawsuits today.