At that price, there is little deterrence, because the risk of being caught is low. Fines are "big" so that even with the low risk of getting caught and being sued, people think "it's not worth it."
Moreover, high fines encourage copyright holders to bring suits to enforce their rights; if the fines were lower, it would not be cost effective to bring suits, and copyright holders would be effectively denied the ability to enforce their rights. I really don't understand why people are advocating that the system favor the infringer.
I disagree if the fine was $25 per song most people would think twice about illegally downloading a $1.00 song. $25.00 per song can add up very quickly.
A provision requiring the downloader to pay court costs and legal fees, if they unsucessfully contest the $25.00 a song fine would give the copyright holders incentive to pursue claims. Perhaps it should even be $50.00, but $750.00 is unconscienable, especailly when we are dealing with a minor, IMO.
I don’t advocate a system favoring the infringer. But the punishment has to fit the crime. Generally speaking, in civil cases, plaintiffs can only recover actual damages, plus court costs. The recording industry has been given special privilges to receive judgments that are 75,000% higher than their actual damages,(no doubt through some graft in the form of campaign contributions to congress) and IMHO this is wrong.
The point is that the penalty should fit the crime.
Cutting a thief's hand off discourages theft, but I don't think anyone here would argue that as a penalty it is too severe--because it does not fit the crime. Likewise, being penalized ~$40k for "stealing" 37 songs cannot be said to fit the crime.