&#62; 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.<p>How is it "optimal" if it doesn't address the obvious cost?<p>We don't consider compensating producers as an externality where physical goods are concerned, so why is it an externality for intangible goods?