Let's say you are a developer and want to have a go at this whole "iPhone" platform. Let's also say that you lay out the money to register with Apple, spend about 250 hours to develop an addictive and entertaining game, and manage to get it approved for sale in the App Store.
If you have made it this far, as James and Constance Bossert of Fairlady Media have, then you probably would be excited to see a sudden spike in application usage... but according to a post at TorrentFreak, that was only the beginning of the Bosserts' problems. When usage shot up for their app "Whack 'em all" (iTunes link) without a corresponding increase in revenue, James went to work figuring out why. The bad news: his app had been cracked and was being distributed, for free, for use on jailbroken devices.
The cracker's (handle of "Most_uniQue") stance on the matter, as reported to TorrentFreak, is that Apple is responsible for the content on the App Store, and users should not have to pay for an application that might be "ridiculous, worthless, or poorly-represented" (which seems faintly ridiculous; isn't that the point of the iTunes review system?). MU told James that until Apple implements some sort of "try before you buy" system, the only recourse for developers who want to avoid cracking and sharing is to either create a trial/limited version of their game, or submit a jailbreak version to Cydia as an ad-supported app (again, not a well-considered idea: the population of jailbroken device users that would be able to view the ads is both small and difficult to measure, two factors that advertisers dislike).
Some might call this cracking-for-change approach to reforming the App Store a form of extortion; others might point out that one of the major remaining motivations for jailbreaking is to have access to cracked apps. Without a parallel/independent licensing control system or copy protection outside the App Store, developers are hamstrung.
While Fairlady Media's James and Constance are remaining relatively positive (the additional exposure is helping legitimate sales along with the cracked copies), it is easy to see that there is a hole in Apple's system. If it is possible for video rentals to be time locked, in theory it should be possible to do this for App Store applications as well. We here at the TUAW HQ do not encourage stealing from hard-working application developers, but we still want to know what you think, even if you happen to be pirating apps.