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So you could get a £100 scanner that was in itself 'reduced' from say £200, with that you could get your nobbled version of Photoshop for free, plus some SCSI card that was 'free'. This may have been when '4' or '5' ('n') came along, if you owned any version of n-1 then you got the £150 upgrade price rather than the full £450 sticker price as it was back then. You may be right, however, there certainly was an upgrade path from the scanner edition. If you are working on the web then there are so much better creative tools to be working with than the desktop publishing applications of the 1990's. Then I discovered things like inline SVG graphics and imageMagick. That was how I ended up with a legitimate copy of Photoshop for so many years. Then you could upgrade that to the next version that came along. Before the cut down versions of Photoshop came along you could buy a ridiculously cheap flatbed scanner that came with a legitimate full version of Photoshop.
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There were good reasons to run the pirated version of Photoshop even if you owned the paid for version. Photoshop broke down this barrier to entry as did After Effects. If you had an SGI workstation and you paid $40K a year to Avid to run Matador then you didn't look on Photoshop as a serious thing (it was priced at 1% of the price of the pro tools plus you needed a machine that only cost 10-20% of what your workstation cost). In some industries Photoshop was seen as just a toy. Some products such as Paint Shop Pro had the edge on Photoshop with features such as being able to read more images and have a finer control of what gets saved. I liked the proliferation of other tools that existed back in the day, things like the Kai's Power Tools plugin for Photoshop.