It might be true of first world. I do not think that in poor countries like India where 100s of millions live on less that ~2 dollar a day any service could be

It might be true of first world. I do not think that in poor countries like India where 100s of millions live on less that ~2 dollar a day any service could be cheaper than piracy. And I have seen people in India jump through hoops to pirate content rather than paying even a little for convenience. Gabe Newell's observation seems to me a very limited view of the world by a spectacularly successful first world entrepreneur.