As the Apple iTunes store clearly demonstrates, people are willing to pay for content if the price is right and the buying process is convenient and attractive. Make it easy for your customers to find you, and make it easy for them to use your content for legitimate purposes. For example, some content providers are refusing to grant backup rights to their customers, or the right to move the content to a private grid. This forces the customers to find other sources of content, and these other sources may not always be on the up-and-up. The customers suffer as well — if the content turns out to be stolen, they will be legally liable for using it, whether they knew it was stolen or not.
Another option for protecting content to add a registration mechanism and server-based software, similar to the way software companies protect their products. These systems can also be circumvented, but it will take considerable skill and effort — hardly worth it for hackers for the majority of products out there. The hackers will first go after the unprotected, low-hanging fruit, and after the most high-end, high-demand products.
Finally, stay ahead of both illegal copiers and cheap imitations by making your products better. Invest in developing a brand identity for your products, in after-sale support, in keeping your distributors happy, and invest in design and innovation. The hackers can’t match any of that.