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I am not sure what % of players use them, and/or how risky it is to get caught. I know Pokerstars has the reputation of being the most proactive when it comes to hunting down "illegal" software, cheats, bots, etc. It seems also that Full Tilt has been cracking down recently. Other rooms don't do much about it I think.
The use of these programs seems to be widespread though, given that training sites like Grinderschool seem to endorse them, since they link to them on their site. See this post I just wrote and their answer below.
There is software like Holdem Manager and PokerTracker3 which record the hands YOU play and compile statistics on the players that you play, locally on your computer, not in a central database like PokerEdge and PokerSherlock do. This is commonly accepted by the poker rooms as fair usage. However, even these programs can be used to "datamine", meaning recording the play at observed tables, where you are not sitting. And also you can buy hand histories online, and load your local database with these. This is beyond the control of the poker rooms.
Your concern is legit, and I also don't appreciate that my detailed stats are collected in this manner and made publicly available (you don't even need a license for the program, just visit pokertableratings.com and poker-edge.com, and enter your screen name and your stats will pop up).
Most players here on FTR or 2+2 (including myself) use at least Holdem Manager and PT3. These are very useful tools, more than anything else to review your own play, but the heads up displays help also when you play multiple tables to have an idea of whether you're up against a fish or a reg. It would be very difficult to play 8 tables and remember how each player has been acting during the current and past sessions.
If you want more outrage, visit the poker bot sites, like pokerai.org or Google Shanky poker bot. See also this thread, esp. post #6, and search the forums for "bots".
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