Average customers don't want to trudge through pirate sites infested with malware, search for a game, find a working torrent, download for a couple days, extract, burn, install, and crack a game. Even if they could figure out how to.
And that's exactly what Ubisoft is fighting. Don't get me wrong, I can't stand this excessively restrictive copy protection either, but the reality is that it's doing its job quite well. It does two things:
1) Make a crack take longer to accomplish. Because the crackers have to play through the game to ensure they get all the code fragments from the server, they can't do a 0-day release anymore. That means when the game is first released, it's no longer a choice of "do I download it for free, or do I buy it".
2) Make it more difficult for the "casual" user to play the cracked version. Having to modify your hostfiles to redirect sites to localhost, for example, increases the technical proficiency that's required to make use of the pirated versions. Sure, there's a large chunk of the population for which that'd be no difficulty - indeed, I'm sure most of us could accomplish that. But there's also a significant chunk for which it
would be difficult. Piracy had become a simple matter of "download, burn (or mount), install". By making it that easy, it tilted the scales towards piracy as the simpler option. Anything that Ubisoft can do to make piracy more difficult will decrease the number of people who end up pirating it.
Will it stop piracy altogether? Of course not. But that wasn't their goal in the first place (well, assuming they were being realistic). Their goal was to slow it down, and decrease it's frequency, and their new system does both of those things.
The problem, however, as has been pointed out numerous times already, is that in doing so, they also made things much more annoying for legitimate customers. If it weren't for that fact, this new system could be considered "Mission Accomplished".