In my opinion, I think sites like these are here to stay one way or another since the onset of the internet. So the entertainment industry should look for ways to embrace these sites and use them to their advantage. For instance, look at the business model of Hulu! Except for CBS, the other major networks invest and participate in this venture. It is a viable option for people who can't afford cable and can't get satellite based on location. Hulu has the free version and the paid version for premium content.
I also believe that the entertaiment industry as it cries foul and yells "revenue loss," they are not taking into consideration the folks who have watched an episode of a series on Megavideo, fell in love with the show and purchased the series. Same with music! Yes, you have those that don't as well, but I believe these sites could be a win win for all involved with a little innovative thinking. People are too quick to sue for an easy buck and not look for steady reliable income for the long haul.
Personally, I will admit that I have watched an episode or two on Megavideo if I missed one on TV. However, many times the show was not available because Megavideo had removed it for "infringement violations." It seems to me they just couldn't keep up with the massive uploads by individuals over time.
One thing we can all bank on is "change." You can choose to hold on to past and fade away, or you can embrace it and move forward.