I actually read about this technique a long while back for Spyro The Dragon in GameDeveloper. Basically the developers set it up so that pirate copies play, but they will degrade and the game will be broken.
This is a very effective technique. Here's why:
01. Casual Pirating will Decrease - Uhh lets say I want GameX. I go find a pirate copy, which takes a while (at least a day, usually more if youre not some 31337 Kr3w m3mb3R). I install it, I play it, its all fucked up! Then I just say, ahh fuck it, and I either uninstall it and buy or uninstall it and I just say fuck it and dont bother. Because I certainly dont want to spend another day looking for another pirate copy.
02. It will delay crackers. Crackers will lets say crack the game, post it on the net, and forget about it. Then, in a few days or a week or 2 weeks, people will be like, "hey fucker! The game doesnt work". Since the bulk of sales on a game is made in the first month, this small window without a working pirate copy available is critical.
The trick is to make sure the brokenness of the game, though, is just right: Make it happen too fast and people will just go right back to cracking it, make it too slow and it wont even matter.






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