The Pirate Bay doesn't operate by actually hosting the files, yet neither did Napster and look where they ended up. The Pirate Bay was designed for people who actively go looking for free copyrighted material and actively encourages it.The Pirate Bay is a platform for people to search for pirated material. There's a big difference between most torrent sites and TPB: most sites use ad revenue to pay for hardware costs, and have little left over for anything else; TPB is commercial site that uses others IP's for its own profit, and solely for its own profit. It's made a business out of duping people into believing that it agrees with their "cause".
I am not trying to defend the record or production companies. I think their business models are completely useless, they are slow moving and the way they treat their low-profile artists is really bad. However, I do not condone piracy. Although, unless the record and production companies start to pull their weight and work with companies such as Apple who are innovative and who do understand the internet or invest money in creating a service themselves then they are just going to keep shooting themselves in the foot. Piracy will never be dead, but the majority of people will pay for content or accept advertising if it is easy to get to, it is a reasonable price and there is plenty of content without any restrictions so people can move their media around to the devices they choose. DRM is just ridiculous, it's a restricting way to limit use of content and only hurts the people with only good intentions. The people that want to share it for free ARE going to find a way. The war on piracy and thepiratebay will be, in my opinion, an eternal one.