We see how this works out in the historical patronage system; before the development of copyrights, most reproducible art (poetry and the like) was created not to sell, but to flatter some aristocratic bigwig -- that's why its conventions were so stubbornly moribund, and why it took something like 1400 years for the novel to be reinvented after the end of the Western Roman Empire.
I think this is a particularly alarming situation in regard to computer games; it would mean that the average game would probably be a cheaply-produced advertising piece -- imagine a world in which the Burger King promotional games outnumber _Jagged Alliance_ and _Final Fantasy 6_ by an even larger margin than they do now. I think that we can get a hint about what would happen by looking at the Arab world, where piracy is unusually rampant and the only active game development is done by Muslim fundamentalists...
Sure with an indie title you have fans that are more sympathetic to the producer, but with mass market titles you have the entire mass-market demographic. Do you really think that the number of people in the mass-market who are too lazy, dumb, or otherwise choose not to pirate out-weigh the ratio that sympathize with indie producers?
Show us some statistics please if you're going to make this argument.
I'd hypothesize that its popularity is directly related to its production values and budget, with a few exceptions. That is, the more popular media is the kind of creation that needs to be incentivized, because its expensive.
I've seen people who aren't even particularly tech savvy pirate Hollywood movies and major label music. It seems to me that pirates are killing the very content makers whose products they most enjoy.
I don't have any statistics or evidence beyond the unanimity of my personal experience and observation. Could you give me statistics that show people pirate low-budget content more than the reverse?