@ Agantuk.....
Microsoft really isn't as bothered about piracy now as it used to be earlier. Some amount of piracy is good for all software as it acts as indirect word of mouth.
Then y r they so paranoid over it? In their latest edition of Officesuite, they ask u for activation every 3 months. What has it done? Even legit buyers are thinking atleast 10 times before upgrading to it! Leave aside that "Word of mouth thing". They wudnt have been treating legit buyers like criminals, if they werent that paranoid about piracy.
All that does is, shoo off even the ppl who used to buy pirated stuff.......the word of mouth which u r referring to. All that has done is, ppl like me are now using open source as much as possible & also spreading a bad name against them!
U wud say what wud 1 or 2 or even a bigger handful of ppl wud do.......i wud say that negative publicity spreads faster than positive. Its a different fact that whatever negative is being spread, is atleast 90-95% true.
Windows CDs sell for 100 bucks in the grey market. MS will shutdown in less than a year if they had to sell Windows at that price. That is like less than 1% of their selling cost.
What selling cost? I can visualise only this much - (I MAY BE WRONG, CORRECT ME WHEREVER NECESSARY!

)
Advertising.......well u dont need advertising if u sell Original OS for petty 100 bucks.
Media for OS......DVDs hardly cost Rs.8 per piece even in retail markets, leave aside a large scale
business like this.
Packaging......do what the local pirate does - put it in a simple plastic cover with a dull looking snap of Windows. Nobody wud even care to look at it, if they get original OS for 100 bucks.
Distribution......well its not physical goods. All u have to do is transfer the intangible content from one nation to another. Thats negligible cost.......
Salaries of sales guys/Commission......may be this can be a major chunk of the cost, but still it can end up well within reasonable limits on per unit basis, as the no. of units sold go up.
As a result, they wud earn respectable amounts per unit - way over and above the per unit variable costs. After x no. of units, they can recover the fixed costs fully & whatever they get after that, will be clear profit!
Ah, and why did i again forget what Moserbaer is doing........same thing what i mentioned above. Ur local media vendor who owns a small shoplet also sells Moserbaer CD/DVDs.....they have just about decent packing material & off u go! I have numerous Moserbaer CDs with me. Instead of going to the pirate, i went to the shop & bought the original stuff!