Why do you think different rules apply for business and home users? Don't you work for a business? Aren't they damaged?
Because business:
1) Sees software costs as being part of doing business. Home users tend to think about them as money spend.
There are SO many things which you do for free in a home setting that businesses rutinely spends money on, as it is seen as a natural part of being in business. Examples: Accounting, cleaning (most private persons clean their own house), food (at home you cook, in a business setting you go to a restaurant), consulting (a have practicalliy no private clients. They will rather fiddle with Windows a whole weekend, than pay me 1 hour. Not so with business).
2) As I mentioned earlier: Business are vulnerable to disgruntled employees who report them.
3) Law is soooo much harder on businesses pirating than private users.
4) Business income depends on having software. Not so with home users. You will get your salary - it does not depend on you having Far Cry installed at home.
Of course, you don't see what piracy does for small developers. That's because they've failed and gone under.
Some developers stop / go under. People bemoan the loss of choice and blame the bigger developers and concentrate on pirating them instead. These bigger developers survive because some people still buy their software and pay a price high enough to compensate for all the thieves.
I have worked for several small developers my self (and been one my self). Some have gone under, but none due to piracy. Some of the reasons for failure I have seen: Bad project management, getting crushed by Microsoft, cost of Windows development, getting competed out by the public sector which poured millions of tax money into a "free" alternative.
Small developers are vulnerable, because one error can cost them their busniness. Big business can accept some errors because of multiple products and established cashflow. Contrary to what you say, bigger developers also sell the software much cheaper than smaller developers can do.
As you say, smaller developers come and go, but piracy has nothing to do with it.
People won't pay what they perceive as higher prices / too high prices for things so they pirate. Either that or they pirate just because they can.Prices and costs increase as a result, as does more prohibitive copy protection systems (which I don't like more than anyone)
Piracy is rampant in some countries and many home users, which is a problem if you depend on those markets. But for most software there is no problem. During the 1990's a successful consumer and business anti-copyprotection campaign created an environment where practically no copy protection was in place. During that period there was the biggest market increase and biggest drop in software prices in software history, even though there probably was more copying as well.
Even today smaller developers sees an advantage of doing without copyprotection/activation. Why is it that WordPerfect with a 3% market share is not protected, but MS Office with a 95% market share is?
As I said: Copy protection does not make sense for small developers - it is for monopolist.
Piracy exists, and it is a vicious circle. When 'free' runs out, don't come moaning.
Even without copy protection, the software industry will thrive. And I would even say, it thrives because there is no protection. What it can't do without is legal protection, and people who earns money on other peoples work makes me angry. Either by earning money on their job by using pirated software or even worse by selling counterfeit software. But copy protection won't stop any of those - the russian mob will crack Vista - trust me.
You can try an justify theft as long and as often as you want. But that's all it is.
Theft.
One user with this attitude = no real problem.
Lots of them = a problem.
When you next moan about copy protection but suddenly there's no alternative think about why.
If you had nothing but $5,000 in your house and 500 people took $10 each, how would you feel? At what level does it become acceptable to you? When you come home and there is $4,000 left? You'll be saying that it is acceptable next to break another law and steal your neighbour's stuff to make up for your own loss....
Of course the software industry will continue to thrive. But saying that it will thrive because of theft is just stupid on so many levels.
Word, Playa.
Thieves Don't See Themselves As Thief, But Victims.