Microsoft, ESA and Nintendo Press Release on U.S. 'ModChip' Raids Posted by XanTium | August 1 22:50 EST | News Category: Xbox_Xbox360

Microsoft, The Entertainment Software Association (ESA) and Nintendo posted press releases concerning the raids on US modchip resellers. The Microsoft press release: [QUOTE] Microsoft Corp. today issued the following statement in support of the U.S. Immigration and Customs Enforcement's (ICE) anti-piracy enforcement actions taken against distributors of modification chips designed to circumvent copyright protection on popular game consoles, including the Xbox® and Xbox 360™ game consoles: "Microsoft applauds ICE for its effort to reduce piracy and protect the intellectual property of Microsoft and its industry partners. This is an important step in the continuing fight against piracy and the threat it presents to the global economy and consumers throughout the world." [/QUOTE] The ESA press release: [QUOTE] The Entertainment Software Association (ESA) today commended U.S. law enforcement agents and prosecutors' work in undertaking the nation's first and largest anti-piracy raid of its kind. The action, code-named "Operation Tangled Web," targeted retailers selling modification chips through the Internet for the Microsoft, Nintendo and Sony game console systems. Law enforcement executed 32 search warrants in more than 20 localities across the country within a 24-hour period. "Plain and simple, selling and distributing products to illegally bypass game consoles' piracy protections is a crime with real-life consequences. This is not a game; we're talking jail time. Enforcement initiatives of this scope send a clear message to both the public and pirate community that this illegal activity will not be tolerated," said Michael D. Gallagher, president of ESA, the trade association representing U.S. computer and video game publishers. "We commend Immigration and Customs Enforcement (ICE), the U.S. Department of Justice, and the participating U.S. Attorneys' offices for targeting individuals and groups selling 'mod-chips' and pirated game software." Modification chips or "mod-chips" are typically installed in video game console systems to circumvent the technological protection measures and enable the user to play pirated game software. These chips, as well as other circumvention devices, are illegal under the Digital Millennium Copyright Act (DMCA). "As an industry, we protect our intellectual property, encourage our government to crack down on those who break the law, and urge other governments to take similar action against video game pirates. Yearly worldwide piracy costs total over $3 billion and it impinges on businesses and employees who create, develop, and distribute innovative products," said Gallagher. "The ESA will work with federal law enforcement to ensure that those engaged in the illegal trade of circumvention devices are prosecuted to the fullest extent of the law." [/QUOTE] The Nintendo Press Release: [QUOTE] Today U.S. Immigrations and Customs Enforcement agents executed 32 federal search warrants in 16 states as part of an investigation into the alleged sale and distribution of illegal modification chips for various video game consoles, including Nintendo's Wii™ home video game system. The mod chips designed for the Wii console circumvent the security embedded in the hardware and allow users to play counterfeit Wii software. This Immigrations and Customs Enforcement investigation represents the largest national enforcement action of its kind targeting video game piracy. Nintendo has worked closely with this branch of the Department of Homeland Security, and fully supports its actions and other investigations currently underway. "Nintendo and its developers and publishers lost an estimated $762 million in sales in 2006 due to piracy of its products," said Jodi Daugherty, Nintendo of America's senior director of anti-piracy. "Nintendo's anti-piracy team works closely with law enforcement officials worldwide to seize mod chips and counterfeit software. Since April, Nintendo has seized more than 91,000 counterfeit Wii discs globally." [/QUOTE]

Nintendo might be smiling Ear to Ear right now.. but this doesn't change things. It scares some.. but others will see opportunities.

I concur

That's sad that Nintendos Anal-ists are soooo bad at math that they think that those counterfeit discs and/or mod chips would have been direct sales anyway.... Maybe 5% of that figure quoted is realistic.

I've noticed that Anal-ists tend to not live in the real world with everyone else.

just as long as they dont do this
http://www.youtube.com/watch?v=vjDp036b1lM
Ill continue to buy them

How do modchips fall in to play if someone wanted to use them for Import games as it is a very big selling point for a certain white Nintendo console chip.

If i had a friend who likes games from japan, is he all the sudden a criminal for playing them in the USA using a modchip?

While technically correct, wouldn't it also be the smallest?

It's a sad day for the USA. I hope the best for anyone affected by this!

On a side note, I'm guessing overseas companies will start offering discreet shipping services to the USA. Wouldn't it be awesome if a software exploit was discovered soon? If only life was that ironic!

The majority of Wii mod chips don't affect region play, the disc itself has to be patched to change the region. So other than those that patch on the fly, the mod chip won't play your legit NTSC-J games. Either patching method doesn't work 100% of the time, with many Japanese games remaining unplayable.

US games have the least of problems with being patched, making the mod chips a great help for the PAL market of course.

good thing i only do softmods....good thing i live in canada....wait...no eventually this will happen in canada too because USA is like canada's big brother..

I'm not a genius by any means but let me understand this. They went after 32 sellers? 32, seems a bit small, and if you ask me I'd say it's quite insignificant. So what did we all learn over this? Well we seem to only be able to come up with completely software only modifications that are coded in simple C that a person can distribute the the directions on how to code it over HAM radio. I don't hear any objections to that?

Or, maybe a console maker, I'm looking at you Nintendo, maybe just maybe, might allow people to actually tinker with MY hardware. As seeing that I bought it, not you, or a bought a lease on it, or purchased it under the premonition that I cannot use what I purchased the way I see fit, but I used my money that I saved instead of spending my money on a PC, that I CAN USE.

But hey, I like being treated like a child. Pardon me while I get back to staring at advertisements and accepting the world the way that others want it. You know, I might go on a rant over religion, but I think you get my drift thus far.

If they were so innovative, then people wouldn't have to circumvent them to run homebrew apps like XBMC on them.

i think ranting is your religion

well said...i love my xbmc and do agree that piracy is bad so the wii and 360 chips obviously have no other current use than piracy, unlike the xbox chips that can be used for linux or homebrew...

i hope that most that will be charged in this raid were actually participating in illegal activity like selling pirated software - that makes me mad that someone would blatantly (and directly) profit off stealing someone else's work. i have a feeling though, that some who technically weren't doing illegal things will just get tossed in the mix and suffer with the others...

ooooooooooohhh were scared... This isn't going to stop people that want to get them.
It sounds like its time for industrious Americans to start setting up puppet companies in Canada and Mexico.
These people (ESA, Nin) aren't as smart as they let on to be when it comes to raiding companies. These places didn't even try to hide anything. Shit, look at the war on drugs... a joke. I don't see mexico cracking down on mod chip resellers, or for that matter, cocaine resellers either.

The Xbox 360 modchip (or firmware flash) is the best way to run Linux on the system right now, so there is a legal use for it right there.

Same for the Wii chips, since it allows you to run Gamecube homebrew on the system.

all I see and read in this article is "blah blah bla bla blah" (whatever)

i dont see how nintendo can say anything. Getting in trouble for selling wii chips for piracy is like getting charged with breaking and entering on a house with the door standing wide open. You need security to make it illegal to break it.

This is ludacris oh no im a criminal i bought a computer chip lol yea right why don't these companies grow up and mind there own business and stay out of adults business.-xlordx

So every video game retailer sales memory cards. Since those are chips that can be used to "illegaly circumvent copy protection" (if there's a way to circunvent copy protection legally, please let me know ) on the Xbox, aren't them all technically criminals? I demand real justice!

Going just after these particular retailers isn't some sort of discrimination? I think they should have some sort of defense on their cases based on that simple fact...

Oh and I think that press release writers are retarded and underestimate readers too much...

So are they going after the just the sellers or the buyers too?

Personally, what has always pissed me off about these companies is that they claim they lost $xxx million in sales due to piracy. The fact remains though, none of the people who pirated your games/software even thought about buying it legally. They should be glad that people are actually using their software and telling other people how great it is...word of mouth, best form of advertising...

</rant>

Gman22

These raids do make me sick. Now if they are nailing people for selling copies of games, that is one thing. But having the ability to unlock new worlds on your console is not illegal. Look at XBMC for crying out loud. Before softmod was so readily available (and safe), there was no way to do it without a chip. Some still prefer a chip. Not all software manufacturers have a disc replacement program in place either. So playing a copy in your home, on your system should not be illegal. All the chip does is allow access to these things. The chip itself should not be illegal. Its not like we can play on LIVE with a chip anyhow. Not sure how PS2 works.

Dude, the gaming industry just wants more money money money. They are already pushing towards beating out the movie industry, but those profits are not enough for them. It is like Wal-Mart, always looking for a way to make even more pennies on the dollar.

They treat these chip retailers like drug trafficers (sp?). It is our console. We should be able to adjust or modify them in the method of our choosing. They already have the online checks and balances in place, so why are they so concerned with what we are doing while offline. Just let us sell and use our chips in peace please!

Sorry for any legit retailers busted in that raid...

I thought it was Against the law to sell the chips PRE flashed?
any mod chip I have ever got was blank, I had to find and then load the proper "software" for it run right, without this it's just a useless chip and so how could I be held accountable for what others do to it?
Am I wrong here did I miss something?

Wow Nintendo and their small man complex.

When I first heard the news, I knew Nintendo had a hand in the raids.
They are pittbulls when it comes to piracy.
It's funny how laid back M$'s statement was in contrast to Nintendo's. And $ony didn't even bother releasing a statement

Good luck Nintendo!
You've decided to decapitate the beast from the get go.
Some how I get the feeling that this will back fire on the house that built the Wii.
By no means does this mean that mod chip use is illegal, this is just a start of a long legal battle.




I think it's funny how Nintendo continues to ignore Southeast Asia, the cradle of piracy.
Is it because Nintendo understands that piracy actually brings in $'s in those nations?

Leave it to our goverment and I want to know who pissed on nintendos cheerios.

just a thought..if enough of us stop buying games, systems and accesories for 1 month it may effect their pocket books enought where the companies might just think twice before upsetting their base buyers again.

come on you guys are so full of shit. Homebrew stuff my ass, you really want to play homebrew use your PC. There is only 1 reason and 1 only for using mod chips. Get off your high horses and quit worrying if you are next. The people selling them are very aware of the risk, so are those that buy and use them. You all sound like the perverts on Dateline claiming they weren't really going to do anything with the teenager.

depressing or what, seems now they have moved on from Bit Torrent to Mod Chip sellers.

Fair enough if they are blatant pirates that is a no, no. But selling mod chips is nothing wrong with that.

Shut you pie-hole, i have been running XBMC/XBMP on my xbox for 4-5years now. it´s boots right to it.
I even have one in my bedroom to, I havent played a singel game on it sine i descovered XBMP

speak for yourself you douche, the only thing in your ridiculous post that has any shred of FACT is perhaps that YOU mod your stuff for 1 reason and one reason only,
I have 3Xboxes, all 3 modded and all 3 running XBMC
they are my media servers used to stream Music, movies,Pictures to the 3 TV sets I have at home,
NONE of my Xboxes have EVER even played a single game, it was literally open the box, install mod chip and XBMC and plug into TV

or you to come up in here all high and mighty, and TRY to paint ALL Modders with the same brush is just retarded,
so please STFU, and go be a Douche somewhere else

Un-real. Unreal. Guru, you're a money launderer?

Maybe this is why the TeamModders web site went down rather quickly yesterday?

hey, good point, thanks for the correction...

Please, don't tell modchip should be legal since it allow us to play our backup copy of the game we bought... This is true you can use it for this but actually, maybe 0.0001% of people who have a modchip use it for this...

Modchip is great for stuff like XBMC...

Modchip is bad for piracy...

but the money they clame to lose is not correct... People would not buy all the games they have a copy for... for 5$ you can buy a game... try it... play 1-2hours and finally, you don't like it... you've lost 5$... no big deal!!

I'm quite ambiguous about modchip as you can see...

Anyone know yet who was hit?

I know that these 4 sites are now in accessable and in the case of norcal I know it was working yesterday morning then that afternoon it was gone.

http://www.teammodders.com/
http://www.team-xecuter.com/
http://norcalmods.com
http://otbmods.com

pesonally I think they are FoS ...

First both the Dept of Homeland Security and the DMCA shouldnt exist.

Second the "Losses" that the industry claims are bunk most people I know that have modchips of any kind wouldnt buy many games anyway. Heck I have a total of 9 games for the PS2 and have had it since release

Personally i only have the xbox modded and that is primairly for XBMC. I really dont play games on it much only once in a while when the mood strikes and I find a decent game on clearance for 5 to 10 bucks.

you are actually quite short-sighted in your assumption that modchips are only used for piracy. maybe that is true in the circles that you usually travel in but here at x-scene we primarily appreciate the truly creative and innovative uses of modchips for the many systems to include linux or homebrew like XBMC. also, blatantly inflammatory and accusatory remarks here are not welcome.

Just to backup what 0794 way saying CLICKY.

So are they only going after the sellers or also the buyers?

Unfortunately, under the DMCA even if the chip you're selling has legal uses, if it bypasses the protection then it's against the law. I don't know if they can arrest photocopier salesman or VCR/DVD-Recorders. It's a stupid law, full of contradictions, but there it is.

If that is what they are using to "scare" everyone out of not downloading music..I think that they have to try a more realistic PSA because that is just rediculous

This is just a flexing of muscle for M$.

The original XBox is dead. Sure, there are still stores that carry XBox games, but M$ made their money when the retailers (WAl-Mart, GameStop, etc) bought the games. The 360 is what's making them profit right now, and since circumventing the 360's security isn't typically done through chips, these raids will do little (if anything) to preserve their profits. (Same thing with the PSP. Odd how that wasn't mentioned.)

Essentially, they're just cheering on the ESA so they look like they're being proactive in the fight against piracy. ("We WILL get you!!!!11")

Nintendo has room to speak on this since chips are the primary method of circumventing the Wii's security, and since the Wii seems to be getting the brunt of current-system piracy.

Those of you who're whining about the "loss exaggerations" need to pull the panties outta your ass. It's not like these exaggerations hurt anyone. They're comatting the dishonesty of software theft with dishonest statistics. Boo-fucking-hoo. You're not gonna get arrested because they bumped the numbers up. You might get arrested for having pirate games, but how is that THEIR fault?

If i was in the U.S i would be lobbying for fairer laws in relation to modchips.
In Australia, the law basically states that if it does something else other than circumvent copy protection (ie homebrew or allowing imports) its legal. Read here for More Info and also Here

You are full of it. That statement is like saying anyone who buys a gun is buying it just to kill someone. It is very short sided and the reason we have problems in the first place. A console is nothing more than a dedicated machine in a smaller case. If I wanted to modify my pc to run linux I can and should be allowed to change my console over to linux if I so desire. I bought it. same as I did my pc.

In this case from what I have read and who so far seems to be busted it was not as much chip but that they were loading it with, a bios which is a big No NO. At some poit I believe the chip debate will work its way through the courts and the big guys will lose just like phone companies did with the whole locked to a carrier argument.

good thing i got my wii chip yesterday.

A software pirate and a homebrew user both generate no money for Microsoft. In fact, you've caused them to lose money on those machines. You've caused as much damage as a pirate has.


It's quite short-sighted to believe mod-chip companies make mod-chips for use with homebrew. You think Team Xecuter sells mod-chips because of homebrew? Fact is most people who purchase mod-chips do so with the intention of pirating games. Mod-chips owe their existence to the piracy market, you my friend enjoy the perks (homebrew).

Seems Team Xecuter is taking some precautions:

To say a homebrew person makes Microsoft lose money is very narrow minded. Microsft makes micrsoft lose money They made a concise decision to sale consoles below cost thus losing money. No one forced them to do it. In fact if you look at Sony they actually listened and made the PS3 so you could load linux on it not needing a mod chip.

I agree with a few that talk about not enough of what WE the consumer wants in our game systems.

They say that they put what WE wanted in it. well if ya look at the xbox 360 most of what i see in it now is from what the modding community has created on the xbox 1!!! Yea stream from your pc, OH yea dont forget the most important thing M$ Put in the xbox 360: the ability to open your dvd tray with your controller!!!! oooo wow!!! still only plays wmvs ( out of the box ) there isnt much of a media center ( not like xbmc ) ya can customize the FACE PLATE, but that just makes the system look even more takier!

and m$ wonders ,,, " why do these modders keep doing this"! M$ still needs to learn more from the modding community.!!!!

Here are pictures of the search warrant and Items Seized:

http://www.se7ensins.com/forums/general-di...lgc-vs-fbi.html

That's the risk they took. I'm betting most homebrewers bought more than a few games for their XBox, even if their primary interest was homebrew. If they bought more than 2-3 games new, M$ made money.

If you're gonna go that route, you might as well say that M$ loses money when GameStop and EB resell used games M$ makes NO profit off of resold games, and when people are buying used games instead of new ones, technically, M$ is losing money.



Huh? I'm pretty certain that Team Xecuter gives a rat's ass what the chips are used for. They sell chips to make a profit, not to take out M$. From a company standpoint, killing M$ business (which is what piracy does) isn't smart since they need the XBox to sell their product. By that thought, they'd probably prefer that piracy not happen so much.

I know this is kind of a stupid question, but is soft modding in the same category as chips, less of a questionable method, or more so questionable? This suck, and is wrong. Xbmc is the coolest thing to happen to a game console, and I would hate to think we would be breaking the law by running the app.

A little info from anyone in the know would be awesome.