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tl;dr:
A pretty good series of games gets shelved because of piracy. :[
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Yeah, it kind of sucks that devs have to put more effort into the development process and add features that require online authentication, but it's the same way all media has to adapt to the internet age. Music downloads hurt the music industry, so they created ways to distribute music electronically that helps the music industry. Sure, people still cheat and break the rules, and people will continue to do so until there are no more ways to do it.
Devs can just stop making PC games and stick solely to console games, but eventually with consoles becoming more and more similar to desktop computers, the same pirating methods used on PC games today could probably easily be adapted to consoles. Just add a mod chip, or a swap disc, or maybe a software hack. Devs really need to create reasons to purchase their games besides just copy protection.
I'm not trying to justify why I download games... I know it's wrong, I don't do it nearly as much as I used to. Practically every game I play on PC right now is purchased anyway (WoW, Battlefield 2, BF2142, UT2K4, NWN2) so I don't feel *too* guilty, but I've done my share in the past.
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