When is the RIAA going to realize that they can't stop this. Go after napster if you want, shut them down, but realize that the MP3 trade, and later other forms of digital music, is impossible to stop. Who here has never borrowed CDs, tapes or LPs from their friends? The internet makes this possible on a much wider scale.
Regardless of whether it's right or wrong, it is impossible to police. When it all comes down to it, mp3s are just strings of 1's and 0's that can be changed or hidden in almost any form. The final question becomes how do you shut down some information transfer without stopping all of it? I personally don't think it's possible.
What the RIAA needs to concern itself with is adapting to fit the times. Did Microsoft yell and scream when free operating systems came out? No, they pushed to get their product onto as many PC's and into as many homes and businesses as possible to secure their market share. I'm not saying I want another Microsoft, all I'm saying is that crying like a little B!tch isn't going to get the RIAA anywhere. Business in modern times means adapting or getting the hell out of the way.