Yeah - let anarchy rule!

Well at least that's what most of the posts up to now seem to be suggesting! I was always of the opinion that if you knew the law was being broken, and could do something about it, you had a social (if not legal) obligation to do what you can to prevent it! What appears to be the prevalent attitude here though, is "you'll never stop it
completly, so don't bother trying". That's like saying to the police, "you'll never catch
all of the burglars, so don't bother looking for
any of them!)
There seems to to be some uninformed opinion on how easy it is to hide P2P (or anything else for that matter). The software we use to monitor our network where I work produces some amazing reports on what is being tunneled using port 80 - changing port numbers to disguise content is a complete waste of time. If the "powers that be" decide that ISP's need to stop a particular activity, the tools to score an immediate hit against the majority of users (not the clever types like the posters here - Joe public who just wants a copy of his mates latest album) are already in place.
"
The costs of production are only so huge because of the logistical cost of burning and distributing physical media - if bands sold their music for sensible prices online, folks would be more likely to buy them. " - sorry James, but this is complete nonsense. With volume sales the cost of burning and distributing physical media is only a fraction of the cost of an album. There is no doubt that the big recording companies take the lions share of the income from album sales, but they have huge costs too, and when they take on a band who don't make it (most of them!) their investment goes down the drain. The cost of producing a music video is enormous - if the CD doesn't sell big time, that cost will never be recovered.
I've worked with a lot of up and coming bands trying to do a professional job of getting first albums to the market. Very few have the skills, experience, or equipment to record in their garage or bedroom, so they go to a studio. Even an excellent well rehearsed band will not turn out a decent album in less than two days, and that's
before you start to mix down and master the tracks. (Professionally produced stuff will take a lot longer, and cost a lot more). Then there's artwork to produce, and if you've used even one cover track, you've got to do the work of getting (and paying for) copyright clearance etc. When all else is taken into consideration, the cost of sending of a master tape and producing a few thousand glass-mastered CD's is only a small proportion of the cost.
Do you seriously think that just because bands sold their music "at a sensible price online" that there would be any less piracy? I really doubt it. (Though there are other good reasons why bands should and do turn to internet sales). And if bands choose not to, does that mean that piracy is OK? (Lets say you own a shop which sells widgets. You think your widgets are worth £10 each, but some people sell their widgets for as little as a fiver. Joe public fancies one of your widgets, but thinks £10 is outrageous, so instead of buying one, he just steals it. Are you okay with that philosophy?)
okrzynska makes an interesting point about having file signatures as used with anti-virus products. Fine in principle, and perhaps as part of a package of solutions, but isn't that what DRM tried to do and failed? (Well it stops the average home computer user, but it's pretty useless as stopping anyone with a bit of determination). The problem with music is that it must sooner or later return to an analogue format, and at that stage, any digital protection mechanism is gone. It can then be re-recorded without the protection. (Though if you were to outlaw the transfer of music files without a digital signature, you may be onto something...

)
Of course nothing that ISP's do will ever stop the serious determined P2P pirate - but that doesn't mean they shouldn't make "best effort", and as with most laws, the fact that a few peole get caught is a deterant to the majority of others.
Before advocating a "freedom for all - lets do what we want on the internet " attitude, please show some consideration for (a) upholding the law, and (b) the innocent victims of piracy. When the mega record companies loose out, so do small-time artists, songwriters, session musicians, and a host of other individuals who depend on them for a living. And don't try and absolve yourself by saying that they could make money other ways - couldn't we all! That doesn't make it alright for people to steal from us!