I personally purchase software, if there is a price tag on it. However, I also "shop" around and go for the GPL / Freeware alternative when possible. However, for some things, the GPL and Freeware just aren't as good at, though bless them, they do try hard !!!
I am considering this question for involving both of my handhelds, my Palm T3 and my iPaq hx2755. (Since they're different platforms you KNOW I'm not cross sharing applications! LOL.)
On the palm, most of the stuff I ran was Freeware, with some of the aplications being purchased. The Astronomy software was purchased, the Documents to Go was purchased, ThinkDB 2.6 was purchased, though I refused to upgrade. The updated software wasn't worth the price, ... just not enough features to justify their insanely high upgrade price, let alone their standalone new purchase price.
My iPaq isn't as fortunate on the freeware front, as the available memroy per application is quite a bit lower than my T3. I just can't fit the same ratio of applications into memory. But also because the quality on the freeware of aplications that I need/want just isnt' there as much. To be honest, I feel that Freeware / GPL on a windows platform is still quite in it's infancy, so to speak. It'll get there, but there is still much work ahead of it.
But no, I don't run cracked software. Don't need to. Don't want to. I'd rather pay for it.
Point to note: Someone above mentioned that only about 1% of the downloads actually PAY for the software. they mentioned it was depressing. Well, has anyone considered that someone (like me) might have downloaded it once, paid for it, and was eventually forced to reinstall the software due to some hard reset and that I lost the original install code? Therefore I'd have to re-download the software. Considering that I can load or reload my device off of three different computers and that alone can also increase your download count and lower your purchase / download ratio.
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