"...Sega hoped to avoid this problem by using a new technology it calls GD-Roms, which hold a little more than 1 gigabyte of information on a disc instead of the standard 650 megabytes of a rewritable compact disc. This is compressed in a proprietary format that can't be read by ordinary drives.

The company now acknowledges, however, that there was a "loophole" in the original hardware and software anti-piracy protections. That has been fixed in new Sega-produced games, and the new development tools have been given to outside game companies, a spokesman said.

"As far as we're concerned, this is an issue that is no longer the case," said Charles Bellfield, director of communication for Sega. "We have made changes to our tool set to make sure it's no longer possible."

That may or may not be true for the most recent games. According to sites tracking releases, 18 pirated games had already been released in the week following the first appearance of the Utopia hack, with another underground group called "Kalisto" joining in the releases. Some of these games, such as "Evolution 2" and "Marvel vs. Capcom 2," hit retail shelves just a few days ago.

Some in the computer underground say that not all full Dreamcast games will fit on a recordable CD. But this is far from a significant hurdle, they add--unimportant game features, such as the background audio soundtrack, can be "ripped" out to save space while leaving the game itself intact.

Sega says it will take action against Web sites and other venues that distribute unauthorized copies of its games, as well as make whatever software or hardware modifications are needed to block the copying process. Along with several other game companies, it recently sued Yahoo for allowing people to sell counterfeit games and illegal hardware on the company's auction site.

"Pirating software is illegal," Bellfield said. "We will vigorously defend our software and content."..." NULL