Lord Tony, though the ability to use Linux on the PS3 led to piracy, many groups were using the option to other
ends.
It was these people that GeoHotz made the jailbreak for. He specifically said that his hacks weren't to be used for piracy. Now, I can understand that Sony didn't want to lose money with the possibility of people pirating, but they should have been more considerate to the people who were using the technology for good and at least had some sort of working alternative. This whole situation is silly. It's like having a government sell boats, then realizing the boats could be used for piracy, so they sunk them all. Then one person discovered how to build boats and released the instructions, so they shot that person.
What I really want to know is why piracy on the PS3 is such a big deal? Back when the PSP was first being hacked and Dark_AleX was on the scene with his CFW (Which enabled piracy along with homebrew, though DAX only supported the latter), Sony didn't do squat aside from update the FW and try to prevent further CFW attempts. Dark_AleX ended up enabling an option (that lead to piracy) that wasn't originally available for PSP, GeoHotz only re-enabled it (that lead to piracy).