Why do you feel you deserve all the things you want that you can't afford?
Of course, there's a massive externality to deal with: how do the people who create media get money for it? But in an optimal system (which we might not be able to create) everyone would still be able to consume as much as they want.
How is it "optimal" if it doesn't address the obvious cost?
We don't consider compensating producers as an externality where physical goods are concerned, so why is it an externality for intangible goods?
That's a good question. One important difference is that, at the point of which duplication is possible, the intangible good already exists. Compensating the creator for creating the good may or may not encourage future creations. It's a sunk cost. It's also the only cost.
Not so fast. Yes, duplicating intangible goods is relatively inexpensive, but at point of purchase and use, tangible goods also exist, the costs are sunk, etc, so they're exactly the same.
In both cases, payment compensates producers for effort and resources that have already been expended.
While true, that's irrelevant to an argument that claimed that sunk costs were an externality that wasn't all that important.
If I know X% of the population has acquired something for free, how am I supposed to feel when I'm expected to pay for it. Our society places a lot of emphasis on being the best and always being competitive with one another. How am I supposed to be the best or be competitive with others, when the playing field isn't level. The only way in this case to level the playing field is to also engage in piracy.