They didn't have access to Internet activation to protect their game copies, yet still to make a copy they had to pay quite a value compared to today. Pirates, however, had to distribute copies the same way, thus a CD with a game might as well be a cracked version, even if you bought it as "fully licensed". Now both prices to make a protected copy and to make a verbatim copy are reduced about thousandfold, but game prices aren't down by a cent, and games' attractiveness is also dropped by a serious amount. Say, MOO2 is still played, being patched (sic!) and modded, while no one gets to play last year's CoD because of a new one available, and because they played it once and stashed the now-useless media away. So, piracy existing is good, as it allows to spread word about a thing faster, but if your game is bad, then you really lose from it being pirated because less people would buy your sh!t.