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Funcom No Longer Making Offline Games
1up has commentary from Funcom, makers of games such as Anarchy Online, Dreamfall, and Longest Journey. The developer has taken the drastic step of deciding to cease creation of games without an online component. The company's CEO pins the blame squarely on game piracy. "Several stats he listed were startling if ... true, including that 200,000 illegal copies of Dreamfall had been downloaded before the game was even released and anywhere from three to ten copies of any PC game are pirated for each one sold. Adventure Gamers suggests that future offline games such as Dreamfall Chapters may require an active internet connection to prove authenticity when you play, similar to how Steam works."
And sometimes, it simply can't be played even with a valid Steam account. They had an outage a while back that resulted in many people not being able to play their valid Steam games. Apparently, if the client recognizes that you have a working internet connection, but still can't get authorization from the Steam servers, you don't get to play. Caused all kinds of fuss on the Steam forums.
Assuming his number are correct, I'd say the only thing it really shows for sure is that for every person willing to buy and play a game at their asking price, there are a three to ten people willing to play the game at some price lower than that. True, that price may be zero for some or all of them.
But what if two of those ten would be willing to pay it at half the price? So instead of one player at original price, you get three at half price. It doesn't take a genius to figure out that would be an increase in sales, and most likely an increase in profits. This is especially true when you sell online and cut out a lot of the distribution costs.
Their problem with the alleged 200k copies being pirated before release has nothing to do with "normal" piracy. Those people did not choose to pirate a game rather than buy it, as the option to buy it wasn't available. That's a completely different ball of wax.
So really, all those number say to me is that there is a possible untapped potential. It does not say "we're losing the full price that three to ten copies would have made for every one we sell, because all of those people would have bought the game if they couldn't pirate it." That's RIAA math.