Copyright is both a criminal and civil matter. The civil court system is useful for many things, but it is limited to monetary damages, which is not very helpful when the damages are in the millions and the defendant isn't very wealthy. The penal power of the criminal system is not appropriate for individual people downloading music, but it certainly is for a sophisticated operation involving the illegal distribution of millions of copyrighted works to hundreds of thousands of users.
== Edit ==
Some responses, since I'm rate-limited:
>In most cases i read about it's more a matter of the current copyright holder versus the facilitator. Not a matter of the creator versus the actual downloader.
Two points.
1. How do you think the current copyright holder got the copyright? They acquired it from the creator by either paying in advance or after the fact or as part of some ongoing deal.
2. If you run a market that you know is used almost exclusively by people selling contraband, do you think that's legal just because you're not the buyer or the seller? In case you don't know, it's not, and you'll go to jail just as if you had sold the contraband.
>If the defendant isn't wealthy after distributing all that content, is the content worth millions? Or is the government-enforced business model worth millions?
Yes, intellectual property isn't worth anything without government enforcement. But we've decided to, as individual societies and as an entire world by treaty, to provide such enforcement, because we think recognizing such property rights is good for our society.
And as for the first point, how much you make by violating other people's rights isn't that relevant. If I steal a truckload of iPhones and give them away for free, I still stole them. I realize IP is very different from physical property, but the profit of the crook isn't that relevant in either.