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I do not believe any reports I see about piracy = lost sales.
Many people are, by nature, hoarders/collectors and often grab something just because they can, even if they never would have bought the product in the first place.
Yes, some people just download instead of buying...some have the means and just choose to take, whereas others take because buying would be a real hardship for them. I think many downloads are "Hey, I wonder if this is any good," just to try something and sample it, especially if by a lesser known artist or author.
But overall, I believe only a small percentage of unauthorized downloads are lost sales.
And it is my belief that people will often "sample" a product they acquired for free and then, if they become a fan, will go on to support the creator's other products if the those products are accessible (open formats, non-DRMed, no geographic restrictions) and priced fairly.
Be reasonable to your readers and they will support you.
That said, I take huge issue with the people who justify the use of torrents and other means of unauthorized downloads.
Such users may not consider downloads "theft" on the theory that they are not depriving the creator of physical property, but unauthorized downloads are still immoral and unethical. It is not different than, for example, "borrowing" a neighbor's property without permission or lounging on a neighbor's lawn all day while they are gone at work -- "see, I didn't steal from them." No, but you were violating their rights and you acted unethically.
Instead of just taking without permission, why don't the "pirates" look for and support the creators who do "get it" and allow readers to share, who sell their products at a fair price without DRM-crippling?
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