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Most of the mod chips promise similar functions based on disabling copy-protection features built into the Xbox. Customers are promised the ability to play games copied on recordable CD and DVD discs (and perhaps swapped as files on the Internet), play otherwise inaccessible foreign titles, and copy DVD movie discs otherwise protected by software from Macrovision.
The makers of the Xtender, the Enigma and the Messiah mod chips did not respond to e-mail requests for comment.
Analysts said the chips are unlikely to promote a wave of illegal file swapping similar to the MP3 phenomenon that has polarized the music industry or to the emerging movie piracy threat.
For starters, using the mod chips requires disassembling the Xbox case and affixing the chip to the circuit board, a task that can require more than 20 soldering connections.
Cracking Xbox game software may be even more difficult. Copy-protection software built into all Xbox games makes the game disc unreadable on PCs. So far, only a few hacker groups claim to have been successful in breaking the protection scheme, leading to a handful of game files (known as ISOs for their file extension) being traded over the Internet, mostly in private IRC chat rooms and Usenet postings to groups devoted to "warez," or illegally copied software.
"Xbox games are big, and Microsoft isn't the kindest company around," said "XanTium," an editor of British Xbox fan site Xbox Scene. "I don't think you will find ISOs on public http sites."
The strongest interest in mod chips appears to be in Europe, particularly England. XanTium, who did not provide his real name, said that's because the chips will allow overseas Xbox owners to play U.S. titles without having to wait for a version converted to the PAL video standard used in Europe.
"For some reason, game companies always ignore Europe," XanTium said. "Europe gets games up to six months later and often with a very bad PAL conversion."
P.J. McNealy, research director for Gartner, said Microsoft has little to worry about as far as illegal swapping of game software. "I don't see it as a huge concern moving forward," he said. "This is pretty sophisticated stuff, something the average consumer can't handle."
Mod chips have been available for Sony's market-leading PlayStation 2 game console since shortly after the console went on sale, with no apparent detriment to game sales. Sony has fought back against mod chipmakers, however, with the company's European arm successfully suing several manufacturers for copyright infringement.
A Microsoft representative said the company was aware of the mod chips and was looking at legal avenues to block distribution of the chips. "The Xbox team takes the intellectual and copyright property of Microsoft and its partners very seriously," the representative said.
While the main purpose for the mod chips appears to be illegal software copying, they may also be a boon to more high-mindedlooking to add new software functions such as MP3 playback and emulators to play games written for older systems.
"The mod chips are going to be about the only way to run homebrew software," said Dan Johnson, a high school senior from Sugarland, Texas, and creator of the XboxHacker Web site.
Antony "Sin-Tex" Jarrett, creator of the British Xbox hacking site Xbox Emulation, said Xbox enthusiasts such as himself will mainly use the mod chips to play imported games and run homemade software, although the chips will also be a boon to software pirates.
"The Xbox mod chips can be used by homebrew (software) enthusiasts to do great things with the awesome power of the Xbox," said Jarrett. "But the mods also have a downside by allowing piraters to make money from the illegal selling of copied retail games.
"The problem is, both scenes require the same thing: to be able to run (recordable CDs or DVDs) using unsigned code. At present, this is not possible without the use of Xbox mods."