I had assembled my first computer back in 2004. I did not know the importance of genuine softwares then. Why would anyone bother to spend hundreds of dollars onGenuine Softwares when I could use the pirated ones by getting some blank CDs and taking some time to copy the softwares to the CD ?
 Few years down the line when I happened to perform some deep research on Information Security, I understood how vulnerable I was with Pirated softwares. To understand this, let us consider the example of Pirated Operating Systems.
Back in 2004, Windows XP was the most popular OS (it still enjoys good popularity). Obviously, Windows XP became the prime target for piracy. While there was a popular lobby against Microsoft who were viewed as anti-Open Source, who claimed that they were cracking Microsoft softwares to ‘prove a point‘, there were others like me who just couldn’t avoid using pirated softwares.
But there is a fundamental difference in the way the softwares were cracked then and the way they are being cracked these days. Back then, Operating Systems or Office suites were actually “cracked” by using a genuine product key or serial number. So it was not the software that was pirated, but just the key or serial that was pirated. Since then, there has been a shift in the way Microsoft handles Software Activation.
With the introduction of Windows Product Activation, the practice started of allowing installation of softwares with or without a Genuine Key, which then had to be activated within a specific time period say for instance say for instance 60 days. This activation is done by connecting to the software vendor server over the internet or by calling the Call Center to obtain an activation Key.
Because of this, it became increasingly difficult to continue using pirated keys and this led to a rise in the use of pirated softwares.
It should be cited that pirated softwares are not just a result of pirate keys, but something beyond. Pirated softwares are actually cracked and repackaged by pre-activating it by induviduals who have are ‘hackers’ or ‘crackers’.
The real risk lies in using this Pirated software, as it might be possible that the hacker or cracker may have re-packaged the software with an inbuilt Trojan (see What is Trojan Horse). This Trojan may be use to covertly pass sensitive information from the host machine to the hacker who cracked the software.
Now imagine a scenario where you would be using a pirated software (Pirated OS), and I were to make a Credit Card transaction. Here we are exposed to the risk of revealing Credit Card information to the Cracker.
Consider the following facts:

a) 59% of all cracks downloaded from per-to-peer networks contain malicious or unwanted software.
b) A 10-point drop in India’s piracy rate could create 115,000 new IT jobs and pump $ 5.9 billion into the economy. It could also increase industry revenues by more than $5 billion.
Click here to read more.
To summarize, with Genuine Softwares we have access to updates and support from the software vendor, which would in the longer run result in increased productivity.
For the ones who would still like to continue using pirated software, the picture doesn’t look too good.
Be Safe!
Are you running a pirated software on your machine currently? What Software is it? Why?