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According to my favorite portable-gaming news blog, Tiny Cartridge, hacker Neimod has made some strides in cracking the 3DS. Like the soft modding of the PlayStation Portable, this may eventually allow for homebrew, emulators, and of course, pirated software to run on the 3DS.

So what does this mean for us? Well, one major benefit some gamers are happy about is the ability to finally remove the 3DS’s pesky region locking, which prevents us from playing imported copies of Japanese games, for example. And while that is definitely something to be excited about (Bravely Default: Flying Fairy, anyone?), many gamers won’t stop there.

Whether we like to admit it or not, piracy hurts the industry, and smaller game devs and publishers suffer more than their billion-dollar-budget big brothers. Renegade Kid’s Jools Watsham, the developer of the very cool Mutant Mudds on the 3DS eShop, had this to say about it:

Piracy on the Nintendo DS crippled the DS retail market, especially in Europe. We’ll never know how/if Dementium II landed in as many hands as the first game, Dementium: The Ward, due to the rampant piracy at the time. Dementium: The Ward sold more than 100,000 copies worldwide, which is a great success for an original mature-rated title on the DS. Recorded sales of Dementium II are less than half that. We’ll never truly know why that was so, but many seem to believe that piracy had a lot to do with it.

If piracy gets bad on the 3DS, we will have no choice but to stop supporting the platform with new games. Some say that piracy leads to more game sales, claiming that it enables players to try before they buy. Bullshit. The percentage of people who will spend money on a game that they already got for free is surely very small — especially with so many “free” games already in the market. The line between what should/should not be free is getting very blurry.

While many gamers who pirate games will take up a “damn the man” stance, convincing themselves that they are getting back at big-name companies that charge an arm and a leg for on-disc downloadable content and such, this statement gives us an idea about how piracy affects the little guys.

Let me just climb down from my high horse here for a moment. Years ago, a friend and I hacked our PSPs in order to play Japanese titles before they came out in the U.S. Yes, I pirated a few games, but in all honesty, they were games I eventually purchased once they released overseas. My friend, on the other hand, would download ISOs as they were made available — gigs and gigs of games that he never finished. I didn’t see why he had created such a huge backlog for himself. I hate to use anecdotal evidence to support my argument here, but I’ve read about publishers and developers who choose not to release games in the U.S. because theirs have been pirated too much.

So where does that leave us? Piracy can prevent some great games from being localized, and it can hurt small game devs and publishers. Sure, lots of gamers like to try before they buy, which speaks to the importance of demos. I for one think that for a handheld like the 3DS, which is in a constant battle to keep third-party developers as it is, would likely suffer from its hardware being hacked. Sure, more 3DS units might sell, but what about software? Especially that of smaller developers?

What do you think?