Guys I pirate all my games, in fact I haven't payed for a game since 1998. One of the things I pride myself on is that I never fooled myself into thinking I was somehow justified in doing so. If piracy wasn't an option for me I probably would have bought like, 1 game every two months or about 5 GOG games a month, but why? Why bother saving up for a game when I can have the game, with preorder bonuses I wouldn't ever be eligible for in my country, with DLC, for free so I can buy a new cell phone or a digital camera or upgrade my mobo with the money I saved?
Piracy does represent, in 99% of cases, a loss of revenue for the publisher. The old "it's not stealing - it's copying" argument is retarded to an unfathomable degree, as I'm sure the more intelligent posters on this site already know. If you have enough money to either see a movie or buy a video game or go the circus, it's a tough decision. It's perfect for the market because three forms of entertainment compete with each other for your money in a fair contest. Now add piracy to the picture and it becomes a no-brainer - you pirate 50 movies and 30 video games and spend your money on the only thing that can't be pirated - the circus.
There's a botanical garden in my city which is a popular place for locals to relax on the weekends. Recently they made it so you have to buy a ticket to get in (roughly the price of a movie ticket). Thing is, any 15-25 year old in adequate physical condition can climb through a well-known hole in the fence, or climb over the fence. It's located to side of the entrance with no people or cameras around so you can do it as many times as you want with impunity.
Not a single person who was in adequate physical form, not wearing any expensive white clothes they were afraid to dirty, not being a faggot loser has ever chosen NOT to use this "backdoor". And I think it's safe to say that none of those that did use it ever bought a ticket on their way out, simply because they enjoyed themselves so much or were feeling generous or wanted to support the government.
Whatever advertising and sales-by-exposure you are getting by putting your game out on the web for free is small compared to the amount of copies that will be pirated by people who would otherwise buy it. Companies like Steam, GOG and Direct2Drive prove that not that many people value owning a physical copy of an object so much as to forego huge potential savings.
Edit: just to add a punchline to this mess of a post, consider that the only people who are going to buy your stuff are the ones who can easily afford it. Emphasis on the "easily". This is especially true for video games because cinema is where you go with your bros and hos to relax and thus can't get around spending some money from time to time. If your salary doesn't allow you to afford cinemas, bars, theaters, parks and beaches AND video games, guess where you're gonna trim the expenses first and lower yourself to piracy.
