Software piracy ain't anything new (before there was the Internet and all these fancy P2P piracy, there was the old school Sneakernet kind).
Royal Pingdom blog has a very interesting, blast-from-the-past article about fighting piracy through various copy protection methods, including code wheels, dongles, and feelies. For example:
Dongles started appearing in the early 80’s and were used both for games and commercial software of other kinds. The dongle would need to be plugged in to the computer somehow, often through the serial or parallel port. Without the device plugged in, the software wouldn’t run.
The very first program to use a dongle was Wordcraft on the Commodore PET in 1980. Its dongle (the inventor named it so for lack of a better word) connected to the computer’s external cassette port and was two cubic inches large (32 cubic centimeters). We were unfortunately unable to find a picture of it.
These days some software uses USB dongles for copy protection, so we’re not rid of them yet. Dongles are pretty unpopular among users (it’s arguably one of the most hated software protection methods ever), so usually only more specialized and expensive software get away with using them.