[dredmorbius]

Microsoft does benefit, greatly, from piracy of Windows.

Gates has said so himself: http://www.itwire.com/it-industry-news/market/23137-how-pira...

Gates has also, in the past, confirmed how important piracy is to Microsoft: "Although about 3 million computers get sold every year in China, but people don't pay for the software... Someday they will, though. As long as they are going to steal it, we want them to steal ours. They'll get sort of addicted, and then we'll somehow figure out how to collect sometime in the next decade."

[learc83]

I'm convinced Photoshop is intentionally easy to pirate. They make money from business customers, and everyone willing to pay, and because it's essentially free for people unwilling to pay, there isn't much room for a competitor.

[dredmorbius]

Look at Craigslist for another example.

All listings are free. With the exception of job postings and agent housing ads in NYC. The exceptions provide enough revenue for the small (~40) staff of CL to keep things rolling. The free postings zero out revenues for anyone else looking to compete in the same space, establishing a large marketplace with strong network effects and an effective monopoly.