Spies bollux the production of whatever building you put them on, you can't just plant them as information gatherers. The more spies, and the longer they remain unnullified raises your "espionage level" on that particular race, and increases the odds of stealing technology from them.

How I use spies:

- Once the early game is in full swing, I allocate at least a minimum
amount of credits to create spies. During the game I'll adjust the slider
depending on how well I'm doing economically.
- During the early and mid-game I spend them as I earn them. I pull up the galactic statistics chart and see who's got the worst economy/lowest treasury, thus make the best target (unless their technology is crap). The Drengin or Korath are usually good targets that don't nullify spies immediately.
- I usually keep a minimum of one spy unassigned, so I can peek at enemy planets, and have at least one for a quick counter-response if I get spied on.
- In the late game, when its just one opponent, I save up the spies until I have a good dozen or more. A turn or two prior to declaring war I then deploy them all, targeting either financial buildings, capitals, or farms (the last is a good ploy to use just prior to conquering a planet).
- My preferred targets are financial. The AI often builds tons of industrial, too many to hit, and besides, in doing so I'm likely freeing up credit for the AI to use to nullify said spy. Target their banks and make it even harder to nullify the spy, since that costs money. It doesn't matter how much industry they have, if I target their banks and manage to crash their economy, it should prevent or at least greatly hamper their efforts to counterspy me.
- If I'm doing that Cultural Insurrection thang, I'll often hit morale or cultural buildings if the planet has them.

I just stockpile spys till I have 50 or so then smother the opponent with about 40 of them, replace the ones that get nullified with the leftovers an in about 6 to 8 turns you will have gained advanced knowledge and pull them all out. Build up again and hit the next guy. I just wish I could use them on the minor races, the ones that appear later in the game always seem to have the leading edge tech.

Like everything else, it varies based on your racial picks and what size game you are playing. In medium and bigger games with multiple opponents, I like set my espionage spending to some small amount as soon as my economy is running in the black. These first batch of spies are cheap and stock up quickly. Hold on to them till you have at least 4, I like 6+.

Pick one of your neighbors and dump all your spies on his home world. Even mid-game, it's probably still one of his most productive worlds. With 6-8 spies, you can effectively shut it down. You get to low espionage level pretty quickly, after that, pull all your agents and repeat on someone new.

That's on a bigger map. On a smaller map, you can seriously hamstring your opponent's ability to produce anything at all.

If you're more of a conquering type, think of spies as "Weapons of Mass Unemployment." The only way to counter a spy is money. If you target your enemy's economic buildings and capitols (Economic, Research, Manufacturing) you both deny him that bonus income or expensive structure, and he still has to spend money to get rid of them. If you already have the stronger eccomomy, this lets you grind him into the ground. Doesn't do any good to have production capacity out the whazoo and the best weapon techs if you don't have any money to use them.

This all assumes you have no racial bonus to espionage. If you take either the 1pt (+15%) or 2pt (+30%) espionage bonus, it lets you do all of the above, but with less strain on your own economy. The real power of an espionage bonus is in the late game when everyone has used there cache of cheap spies.

Super Spy deserves special mention since it adds another important layer. Everyone else is limited to spending 25% of their income on espionage. A Super Spy has no such limitation. You can shut down every factory you have (industrial capacity to 0%) and spend every penny on spies. No one can counter that. Granted, you can't win the game with only espionage. Those agents will never take planets for you, but you can seriously destabilize his infrastructure, hence making him easier to conquer.

To see the full power of espionage, take the Krynn, and spend your 9 other ability points maxing out Economics, Espionage, and Morale. Pick Federalist on top of this as your political party and you should be looking at:

+60 Econ
+80 Espionage
+80 Morale

That means you can have an insanely high tax rate and still maintain good population growth. That's a hell of a lot of money for spies. Get two of your neighbors warring in the early mid-game, then let your spies loose on both of them. You have to keep them focused on each other because you will have a very small military which will mainly be focused toward defending your worlds. An early rush to get the Spin Control Center will help too.

Espionage won't win you games by itself, but it can be a big help to any other strategy.

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Does spy activity make the target mad at you in terms of diplomatic relations? I was thinking it might be something you'd do only during wartime (or against someone you expect to go to war with soon?)

Does espionage spending only produce spy units, or does allocating money there improve your general intelligence levels somehow?