So think of it this way, it's not such a bad deal for the music companies.
True. Paying $25 a year is something many people will do. Paying $1000 to legalize your music library is something almost no one would do.
Besides, music companies have no interest in persecuting individuals who own illegal music. It's more expensive for them, and it has the potential of turning into bad public image when the people they start persecuting are 10-15 years old.