DRM itself may have a black name, but publishers have been taking to using it under another name, because in their hearts, they still don't really trust the customer like they used to.
So what is DRM anyway?
DRM is software that prevents the copying of the art piece. Before computers, music companies would put out records, movie companies would show their film in theaters, and if the customer wanted a copy, he or she would have to go out and buy it, because record-pressing equipment cost as much as a house and home theaters didn't exist. The publishers liked that fine.
Records gave way to the tape, which could be, gasp copied. However, the process wasn't easy, and some deterioration occurred. People still bought tapes of music they really liked, and though some cheapskate-ish people copied music, profits were now higher than ever, since people bought more tapes for portable boom-boxes, cars, and so on.
The tape gave way to the CD. The CD represents its information digitally, which means it can be, gasp, copied without error. Still, only a few diehards really violated the copyright, as it was a major pain in the ass. And CDs were cheap enough that it was easier to just go out and buy one.
On the movie front, the tape era was the VCR/Betamax tape time about 5 years later, and the CD era was the DVD. A larger-capacity version of the music-technology, in a way.
But lo, with computers, sound cards, and the internet, came a technology that really, truly, scared the publishers. Napster. Computers could store a reasonably close representation of a song, and endlessly copy this with no further loss of information. With networks and napster, people could copy music from people they had no other contact with. Publishers feared not only htat no one would buy a CD again, but that the very idea of music would be associated with free access. That from now on, music, movies, and anything representable as information would be expected to be free. It would be hard to sell more than one copy, which will not pay for the cost of production.
Publishers have so far reacted with a frenzy of lawsuits to try to stop the copying, and the DRM tech to prevent the copying in the first place. DRM is a piece of software that intercepts copying signals and prevents them. It only allows access under circumstances that the publisher feels reasonable, such as watching the movie. (Or listening to the song.) Access is denied for, say, copying the information to another computer. (Or if it is copied, to not be played there.)
The consumer rejected DRM. Why?
Copyright law does give publishers the right to control copying. However, DRM didn't stop there. Some publishers wanted to put out a media that could be played only once, and would thereafter be garbage. Want to experience it again? Well, you'll have to buy another copy then! And since copyright law gives the publisher a monopoly for obtaining it, they could very well make you use this model. A bad deal at any price, as far as most music fans are concerned. (Many fans can listen to a piece of music thousands of times. A movie fan can easily watch the same movie a hundred times.)
Furthermore, many DRMs grossly overstepped their bounds. Sony's attempt at DRM, linked above, hijacked the operating system in an attempt to prevent any sort of circumvention. Had Sony been even slightly more malicious about it, it would have been in a prime position to steal the customer's personal information (such as credit cards), or use the machine (that the customer purchased) for their own ends (such as running the engineer's simulations, or launching internet attacks at Sony's enemies.) Sony got quite a smacking for that.
What should companies do to make things better?
DRM is only tolerated when it is seamless. It should not be noticeable to anyone not attempting to copy the work. If anybody does notice it, you probably did it wrong.
Most consumers know that publishers will vanish forever if they cannot make money, and they don't want that to happen. One could launch music on older media, or just laugh off some piracy as a cost of doing business.
Know that the market will not blindly accept any business model you put forth, but customers will decide who should prosper and who should not.
What should consumers do to make things better?
Piracy ensures that there will never be any new music. Boycott works whose DRM offends you. Yes, that means losing out on some movies, music, and games. They're not a human right, and you could live fine without them. Pirating them tells the publisher that they're doing the right thing, and would succeed only if those damn pirates weren't ruining everything.
On the other hand, absolutely do not allow rootkits. Media you buy shouldn't try to hijack your things. It's your tapeplayer, cd drive, or computer, not theirs.
Petition congress to shorten the length of copyright. It's been stretched over time. At first, publishers got 28 years to sell their work before it became as free and public as air. Then the publishers wanted 50. Then 75. Now it's the life of the author plus another 70 years.
The public-domain release of old information is a major societal compromise. The publisher wants exclusive rights to it forever, the public wants to copy it immediately, and other producers want the inspiration for derivative works (like a remix, or a reinterpretation, or use in some other form) as soon as possible.
What would go wrong with the two extremes?
Let's start with copyright not existing.
Any idea you create can now be used by any person for any reason. If you hum a melody, a cereal executive can immediately make a goofy cereal commercial jingle from it. You get nothing. Very few people ever make music, and mostly as a hobby. Music, film, and art is rare, amateurish, and mostly made by people who are immensely rich. Most art is a bad rip-off of something that already exists, and when people do get artistic ideas, they keep them totally secret, lest they be stolen for bad commercials, ripped off because somebody felt like it, or parodied because someone had nothing better to do.
Now let's take it in the opposite direction. Copyright is eternal, and derivative works are treated like shoplifting the original.
BigBadCo (tm), slogan "We do things because it annoys you," buys up the rights to Beethoven's symphonies. If I then whistle the well-known first five notes of the fifth symphony, I now owe BigBadCo 5 cents. BigBadCo is in the ridiculous position of claiming that if I don't compensate them, that they will somehow go back in time 200 years and convince him not to write it.
Art is also rare in this scenario. If your art is too close to anybody else's art, they sue you until you are forfeit of everything. Television and movies do not contain music, as obtaining the rights is like pulling teeth. Songs that sound too close to other songs get the musician sued. All stories must have a completely original plot, which is harder than it sounds. Write an epic adventure, set in medieval times? Whoops, you just ripped off J.R.R. Tolkein. The Tolkein family (or whoever bought it from them) will promptly be suing your ass. If you claim that the universe is evil, you've infringed on H.P. Lovecraft, and can expect a call from the Lovecraft family lawyer. Oh, but suppose you take up rap, instead? Ooops, you just infringed on 50 Cent's drum line! Pay up!
Eventually, BigBadCo decides that it hates all art, and buys up the rights to everything it can get its hands on. The tangible forms are locked in a safe, and anyone discussing any existing art form is sued. Some people try to create original art, but it is such a minefield. Too close to any existing work, and BigBadCo will sue you. They will drop the suit for $300 and exclusive rights to your work, of course. (If you give it to them, into the safe it goes.)
Oh and may the gods help you if you work, as your boss makes granting him exclusive rights to all your work in perpetuity a condition of your employment, and he will be quite litigious if he thinks you're holding out on him.
I must go now, as apparently BigBadCo owns the rights to all deities, and I seem to owe them $1000 for that last reference.