Sure, software piracy is a bad thing (especially when the victims are small developers looking for a break in a market dominated by the big boys — so pay those shareware fees, already!). However, in a recent blog posting, Chris "Long Tail" Anderson argues that a little piracy can actually be a good thing. Anderson says that for DRM to be successful, it would have to be so onerous that it would actually undermine sales, citing the examples of hardware dongles (mostly abandoned by software companies) and onerous registration processes (alas, still with us). Instead, he suggests that companies acknowledge that they're always going to have to deal with a certain amount of piracy, and adjust their business models to it. He even mentions speaking to an unnamed former Microsoft exec, who says the company long ago gave in, and ceded the bottom end of the market to pirates, recognizing that it was better than slashing prices to make their products attractive to more consumers. In turn, says Anderson, Microsoft has been able to charge more for their products, while making them less difficult for corporate customers to install (of course, that doesn't factor in recent efforts like Genuine Advantage, but that's Microsoft for you.) I actually think Anderson's comments make a lot of sense; it's sort of like the way retailers have functioned for years. They quietly factor in a certain amount of "shrinkage" as the cost of doing business; the alternative, of putting everything behind glass, would drive away too many legit customers. Is the software industry's equivalent that torrent of Microsoft Office being downloaded by a teenager would never pay for the legit thing anyhow?