I for one would love to see how to market would look if there was no piracy. I would bet that nothing would change, just the excuses would be different. If piracy is such an issue, why are they still releasing hugely successful games with lot's of profit? I think it's just the fact that companies want to have any penny out there, but scraping those pennies only gets their loyal customers lot's of DRM and rootkits.
And as for console games, it's a huge market but also has to deal with lot's of piracy. But the console market has generally 1 great advantage: the majority of people who play console games usually are casual gamers who don't mind playing sequel number 345 of the game which the pc gamer already played back in 1998. Cheap games with huge profit margins, and you won't hear sony and MS complain about mod chips.
Also it is estimated that the videogame industry is taking over the movie industry market wise, so if piracy was really such an issue ...
Complaining about piracy is like the farmer who is complaining about the weather: it's never ok.
Make smart and good games, and with some decent marketing you'll have your 4 rare Ferrari's in no time. Release the 475th sequel of that game people loved in the previous century ... and blame it on the piracy.