Arcade game manufacturers face significant challenges from counterfeit software, which undermines revenue and brand integrity. To combat this, they employ a multi-layered approach. First, advanced encryption and digital rights management (DRM) technologies are integrated into game hardware and software to prevent unauthorized copying. Manufacturers also use unique hardware identifiers and online verification systems to ensure only legitimate copies can operate.

Additionally, legal actions are taken against counterfeiters, including lawsuits and collaborations with law enforcement to shut down illegal operations. Some companies even embed hidden code or watermarks to trace pirated copies back to their source. Regular firmware updates further disrupt counterfeit software by patching vulnerabilities.

Finally, manufacturers educate arcade operators and consumers about the risks of counterfeit software, such as malware and poor performance, to discourage its use. By combining technology, legal measures, and awareness, the industry continues to protect its intellectual property and sustain growth.