Games, movies and music are where piracy is a problem. I don't really think the amount of money charged for these is really an issue by itself. It's easy for me to ask someone for $1 for a Diet Coke and get it. However, $1 for a song off iTunes is too much. So why is it that $1 for diet coke for someone else is no big deal, but $1 for a song for themselves is too much?
I think it has to do with societal pressure. Entertainment is the definition of culture. Entertainment technology evolves at a rapid pace. The blockbuster of today becomes forgotten by tomorrow. Keeping up with this rapidly evolving culture is time consuming and costly. Piracy provides a cheap and quick solution to this dilemma.
Steam is definitely a great example to look to. The free patches make it more favorable than pirating, since a lot of pirated stuff is not exactly bug/virus free. More importantly, the community aspect gives people a social reason to purchase games. The whole social status aspect is the reason why many people pirate in the first place. Kudos to Valve.
Another commendable example is GameStop's policy for being able to return games after they're played once and being able to buy old games for as little as $10 or less. Amazon.com also has a used feature.
I feel that there should be a way to make this more convenient. Books have libraries, and although technology does complicate things, why shouldn't there be a similar feature online? People pay a small amount for membership, download the game they want, the game appears as checked out on the library database, is somehow encrypted to make it hard to copy, and the user has to return it on time, renew it, or pay a small fee? Maybe this idea won't work, point is convenience and cost of games need to be looked at if you want make a dent in piracy