An Xbox 360 modded to load unsigned discs.

NOV. 12, 2009 • Following Microsoft Corp.’s decision to ban from its Live online service those Xbox 360s that have been modified to run pirated titles, large numbers of the modded consoles have begun showing up for sale on eBay. As many as 600,000 of the devices have been banned so far. The policy affects specific systems, not Live account holders, so there is incentive to offload the consoles.

Impact: Piracy is a huge problem for the entertainment industry.  However, sometimes the solution can be worse than the cure.  There is a potential public relations issue for Microsoft as they are not necessarily punishing the actual pirates, but anyone who unknowingly gets a hold of a pirated system. Meanwhile, sites like eBay that offer the modded systems for sale run the risk of facing a backlash for allowing uninformed eBay buyers to end up with a banned system.