Since the local Tesco started selling DVDs for less than a tenner, I've bought well over a hundred. I never bought them before that - anything more than a tenner and I went without. Very occasionally I'd get a dodgy VHS from a mate which, if I'd enjoyed it, I'd go it hunt down (The Matrix was the last of those, and the last one I watched illegally) and pay full price (£17+). There have been no films since then that I've felt were worth it, and prefer to wait until they're in the bargain bucket. Note that by "going without" I mean I did exactly that, and didn't download them. My 20KB/Sec connection makes downloading pretty much anything a PITA.
So for me, the film industry is failing because the vast majority of cinema these days is crap, and what is watchable is way too expensive for me.