vitz3, you have hereby demonstrated your lack of understanding of the topic at hand.
The answer to the question is "possibly." I've had to put a lot of thought into this as well, and have delayed an open beta test of one of my games as a result of this. I don't want players to base their expectations on an unfinished, unpolished game.
Do demos of _finished_ games (as opposed to betas of unfinished games) hurt sales? Usually not, as the reason for the demo in the first place is to _increase_ sales. I could see it backfiring in some cases, though. I downloaded the demo of The Simpsons Game for PS3, which originally sounded like it could contain at least _some_ entertainment, but I have decided against buying it, even as its price is lowering now, because of my impressions from that demo.
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