IF YOU MOD YOU NEED TO READ THIS NOW!
New Xbox Firmware Bricks Some Consoles, Microsoft Makes Amends
small number of Xbox 360 users with older consoles may find their consoles "bricked" by the latest firmware upgrade. Don't worry, though: Microsoft is aware of the issue and is contacting those affected--even offering replacement consoles--gaming blog Kotaku reports.
The Problem: Microsoft's New Disc Standard
The issue appears to revolve around Microsoft's new XGD3 disc standard, which adds 1GB of useable space to the disc for developers. For some reason, the disc drives in a small number of Xbox 360s are unable to read game discs after being upgraded.
The problem was discovered during beta testing of the new firmware, and one of those testers shared the letter they received from Microsoft with Kotaku. Microsoft itself confirmed the legitimacy of the letter in a twitter post on Wednesday.
Microsoft is able to detect the problem through Xbox Live, and can determine who may need a replacement. It's not a bad deal, either: owners of faulty consoles will receive a brand-new 250GB Xbox 360 S, along with a free year of Xbox Live.
New Anti-Piracy Measures Added
The new firmware doesn't just upgrade the Xbox's disc drive (and, occasionally, brick it), it also features anti-piracy measures. According to Eurogamer, the update erases any custom code on the Xbox 360, so pirated discs can't be played. This piracy protection is deeply embedded, which means future attempts to break open the console will be difficult (or, at least, Microsoft hopes).
Microsoft is also adding support for piracy checks within gameplay. Bootlegged discs are never exactly the same as their legitimate counterparts, and so producing a disc that runs consistently is much harder, Eurogamer says.
Microsoft's being proactive is something gamers should appreciate here--especially in light of the recent PSN hack, during which Sony was accused of being anything but. It's also a pretty sweet deal--I understand the console replacement, but a full year of Xbox Live is certainly a bonus.
Microsoft Confirms Tackling Modded Xbox 360Consoles
While there are Microsoft customers that indulge in the illegal use of pirated software without so much as slap on the hand from the company, others are less fortunate. Larry Hryb, Microsofts director of programming for Xbox Live, has confirmed officially that it is actively banning Xbox 360 owners that have modified their consoles in order to accommodate pirated games from Xbox LIVE.
In addition, Microsoft is cracking down on modded Xbox 360 consoles, although it is permitting users to run bootlegged copies of Windows, even providing Critical security updates for releases of the operating system that have been labeled as pirated by the Windows Genuine Advantage mechanism. The Redmond company indicated that it would not stand for consoles to be modified in order for their owners to play pirated games (an operation dubbed modding) and that it would tackle the phenomenon by banning the devices from the Xbox LIVE community.
Our commitment to combat piracy and support safer and more secure gameplay for the more than 20 million members of our Xbox LIVE community remains a top priority. All consumers should know that piracy is illegal, and that modifying their Xbox 360 console to play pirated discs, violates the Xbox LIVE terms of use, will void their warranty and result in a ban from Xbox LIVE, Hryb explained.
One segment of Xbox 360 customers can in this regard, be affected by Microsofts bans even though they had nothing to do with the actual modding of a console. Customers that purchase second hand Xbox 360 consoles previously banned for modding will not be able to take advantage of what Xbox LIVE has to offer.
The health of the video game business depends on customers paying for the genuine products and services they receive from manufacturers, retailers, and the third parties that support them. This would also be a good time to remind you that the warranty on an Xbox 360 console is not transferrable and if you purchase a used console that has been previously banned, you will not be able to connect to Xbox


Larry Hryb, Director of Programming for Xbox Live, has just posted on his Major Nelson Blog that, when the next Xbox Live update is rolled out, all unauthorized storage devices will no longer be compatible with the 360. This is the official word from his blog:

When Preview Program members start receiving the Xbox 360 system update next week, one of the changes is that unauthorized Memory Units will no longer work with the Xbox 360. If youve moved your profile or saved games onto one to back it up, youd better move it back onto an authorized Xbox 360 storage device prior to taking the update. If you continue to use an unauthorized Memory Unit after the update, you will not be able to access your stored profile or saved games.

If you need help identifying officially licensed Xbox 360 storage devices or accessories you can read more about the licensed accessories program on Xbox.com

So, if you currently own and have your data stored on a non-official storage device for your Xbox 360, it is highly advised that you take heed to this warning.