As I understand 90% of people who played World of Goo pirated it and I know a lot of people pirated Audiosurf just from YouTube comments, so how can we as indie game developers prevent our games from being pirated?

Not making any games makes it extremely difficult to pirate our games. I've learned it works great!

Or make it free and accept donations.[smile]

If your data is correct , then it's still 10 % who paid, so the more people hear about how great the game is, the more the developer earns.

I'm not very skilled in this area, but some thoughs and pondering:

It's all about making the process as tedious as possible for the crackers, but also to make the cracked game non-appealing to the players. Online games like WoW and Steam-games (L4D, TF2,..) have been pretty successful imho, by forcing the users to register their game online and use official servers.

Preventing piracy for single player games with no "online gameplay" could be done in a similar way. Given that most gaming computers are connected to the internet nowadays: How about forcing users to register online also for these "offline" single player games, and let official servers store some of the game content, statistics, or even do some of the game calculations/decision making.. Enough so to make official servers too bothersome to replicate for the crackers?

There's always a way around the software protection, but if the cracked version is made unappealing enough (maybe through allowing registers players to view official online stats, receive immediate updates with no fuzz,..) people won't bother running the pirated version.

Sell a service, not a product.

This is the likely the best answer to the question of pirates. Software is cheap, software is something you can pass around and copy. It is going to be pirated, people are going to copy your software without paying for it.

So how do we deal with it?

We GIVE them the software! Its free, pass it out, let people make as many copies as they want. Make your money by selling some SERVICE with that software, but don't try to make the money from the software itself. Or if you do, expect that people are going to copy it and get it for free. This isn't money out of your pocket, they weren't buying it anyway, don't cry over it. Make your game, sell it, get what you can out of it, and make another game. Use the pirates as your advertisers for your next game if you can't get anything else out of them.

Yep, and , although not related to piracy, the game you decribe is well received (after a quick google) and it's got even a Wikipedia entry! Wouldn't you be honored if your home grown indie game got that?

I personally believe that the assumption "pirated game == lost sale" is invalid. A huge amount of those people who played a pirated version of World of Goo wouldn't have bought it in the first place.

Here's an interesting take on the problem everyone concerned about software copyright infringement and lost sales should read:
http://draginol.joeuser.com/article/303512/Piracy_PC_Gaming

In short, don't worry too much about how to protect your game from being pirated, worry about how to make people want to buy it.

% of people who use hacked game is irrelevant. The relevant figure is how many people would have payed for the game if they couldn't hack it. This is how you find out how much mony you lost and in my opinion it isn't that much

how do you figure that "its not that much?" this is just an opinion based on nothing. Any lost revenue is due to theft. I am very concerned about whether you can make suitable revenue off of homegrown software to support yourself.