Okay, I've just read this entire thread and I have to say straight off, wow. There are some good arguments throughout it, and it's good to see that it's continued to stay a discussion and not just a flame-fest. Now, here's my two-cents worth.
The term "piracy" is probably a little misleading. Piracy in the general sense refers to the unlawful attainment of another individuals property/taking something from someone else/stealing. I'm sure we can all agree on this. So, when the term Piracy is applied to situations where torrents are concerned, truthfully it is probably the wrong description to use. Downloading torrented data is not stealing, it is making a copy, as has been discussed many times here. Therefore, it doesn't so much fall under Piracy as it does Copyright Infringement.
Now before someone jumps up and down, I realize the two terms have been one and the same for a long time, however, just for a minute think about the meaning of them. Piracy is bad, and has been associated with things much nastier than copying something. I have yet to hear of a case of someone committing murder, or plundering the wealth of someone (lets just ignore digital bank transfers as technically this falls under stealing, not copying) by simply copying data between drives. So, now that we've separated Piracy (stealing) from copyright infringement (copying), things become a little easier to explain.
In the case of copyright we have this: A team of developers get together and make a product, this product is then taken to a distributor and mass-produced and sold. A (for the sake of understanding) copyright pirate purchases a single unit of the product. This unit is then modified into a re-distributable digital format and uploaded onto a torrent site. At this point, copyright infringement has occurred once, as the pirate now has 2 copies of the product, one in hard format, one in digital. This digital copy represents a single POTENTIAL lost sale by the distributor. Let me clarify, the pirate has a purchased hard copy, 1 sale. The digital copy is a Potential lost sale as the pirate doesn't need to buy another hard copy.
Now, for each COPY of the torrent that is downloaded, this represents not 1 case of Stealing and 1 lost MATERIAL item, which GUARANTEES a loss of income, but 1 case of copyright infringement and 1 POTENTIAL lost sale, which represents a POTENTIAL loss of income.
The point I'm trying to make here is the difference between stealing and copying. Stealing is guaranteed to cause a loss to the IP owner, copying on the other hand is a potential loss to the IP owner. Don't get me wrong, the threat of loss due to copying is still there, but it's not guaranteed. There is the exception where media is copied and then sold to make a profit, in this case IT IS STEALING, similar in the way plagiarism is: in this case you have basically plagiarized anothers work in order to suit your own ends and each unit sold DOES represent a loss to the original developer, you all have to see the sense in this at least right?
Now, there is an upside to the free re-distribution of copied items. Take Anime for instance: the original owners of the works are aware of the community of Fansubbers and dojinshi artists and what they do, but they are fine with it as it promotes interest in their work and creates a larger community. Now let me closer relate this to games: I know the first copied game I played was a standalone version of Starcraft, which I was introduced to by a friend, and it's a game I've continued to enjoy for many years. When the announcement for Starcraft 2 came out, I was all over it - legitimately (pre-ordered). Why? Because of my experience with the first game: I enjoyed the series, and I wanted to support the development of future titles, so I set out to do just that. And you know what? It was because of that very experience that I promoted the game to MY friends, encouraged them to join the community, to purchase it and help keep the ball rolling. Interest breeds interest; pretty soon it's spreading like wildfire, and something that might have fallen into obscurity can be brought into the spotlight. This can be both good and bad, and really it depends on the type of person you are.
Personally, I feel that when you purchase a game based on reviews/word-of-mouth/shiny images/or just plain whim your taking a gamble with your money. It may turn out to be an absolute gem of a program worth every cent, or a complete piece of trash designed solely to squeeze your cash. If I download a copy of a game and enjoy it, I will pay for it and promote it. Why? because it's worth the money and the time (potentially lost sale ---> a definite sale). If I don't enjoy it, it gets erased and never spoken of again (potentially lost sale ---> no lost sale). As you can see this is what I support: If you like it, buy it, and if not, get rid of it.
One major thing in my argument I must point out is that this is coming from someone who has the privilege of buying stuff, and I'm sure this applies to most people here as well. I did read in an Escapist article about the copying of media in countries who DON'T have that privilege. In this case, I don't believe anyone aside from those living there have the right to condemn media piracy in the third-world.
This has been a long post and my eyes are starting to blur, so if it makes little sense in sections, please excuse me. One final thing though, I must say that I completely support the idea of Free-2-Play games like League of Legends, where the standard gameplay is solid and completely standalone, but should you want more content you pay for it (facebook games don't count, they're money-sinks). This is a genius way to help lower copyright infringement as there is no need to buy the game, its already free.
Well I think that's everything, so in short: Piracy is stealing, Downloading torrents is Copyright Infringement, Stealing is bad, CI is a possibility for bad, If you like it then buy it, if not then lose it, and good quality Free2Play games are a better DRM concept. Ummm, yeah hope this sparks some thought (and maybe this was more than 2 cents worth...).
