DRM decreases service value for customers. It also makes pirated copies of games look more appealing. Anecdotal evidence appears to suggest that DRM is increasing and not decreasing piracy.
As far as privacy goes, Gabe believes that people are willing to give up system and personal information if they feel it's being used to get a better service. Steam's hardware survey is an example of this. Rather than spying on users for nefarious reasons, Gabe believes things like its hardware survey helps with better sales of products and service. As long as companies are transparent, he feels that customers will accept this.
http://g4tv.com/thefeed/blog/post/69...-Software.html