The music and movie industries, blindsided by the Web, have been swimming upstream against the digital revolution, suing college students for illegal downloads and fighting tech companies all the way to the Supreme Court, because they believe their business has been hurt by it. But the videogame industry, whose intellectual property is just as valuable, has been comparatively complacent in fighting piracy, despite an estimated $3.5 billion in annual losses worldwide.
Like most content distributed on CDs or online, videogames, particularly games for PCs, are vulnerable to piracy. Copyright protection on the CD itself can easily be overridden by hackers, sometimes in a matter of days, says Ric Hirsch, senior vice president of intellectual property enforcement at the Entertainment Software Association (ESA), a Washington lobbying group. These unprotected discs are then sold to underground groups who make copies to sell worldwide.
Todd Hollenshead, chief executive of id Software, developer of the Doom series of games, recalls a trip to Hong Kong last August to promote the upcoming release of Doom 3. He says an associate ran across copies of the game, complete with its packaging and copyright notice, for sale before it even hit store shelves. "These organizations are so sophisticated and professional that they can often beat our own distribution," says Hollenshead. "There is a lot of competition in the videogame market, but nothing like competing against someone selling the exact same product but who has no investment in creating and marketing the game."
http://www.forbes.com/2005/07/18/vid...dia_newsletter
So why are they ignoring piracy? Could be that they're making money hand over fist in spite of piracy.
Microsoft and Sony videogame consoles have built-in piracy prevention technology, which is tough but not impossible to crack. Hirsch says the PlayStation 2 and the Xbox were hacked within six months of hitting the market.