The five countries are the ones singled out by the Anti-Piracy Caucus as priorities for 2009, with Congress urging said countries to improve enforcement legislation and practices. How are they urging? Through a series of announcements that I am sure weigh heavily on the hearts and minds of those countries' governments, should they be paying any attention at all.

Still, the Entertainment Software Association seems pleased.

"The copyright-based industries will be leaders in our economic recovery – and the entertainment software industry, which had record sales in 2008, will continue to be a strong contributor to our nation's GDP," said Michael D. Gallagher, CEO of the ESA, which represents U.S. computer and video game publishers. "Exports can comprise as much as 30% of our members' sales, and are a direct contributor to domestic job growth. The work of the Caucus helps us to grow our export markets, create jobs and strengthen our balance of trade. Additionally, stemming the flood of pirated creative works benefits and protects legitimate consumers everywhere.

The ESA specifically thanked the Congressional International Anti-Piracy Caucus for singling out Mexico and Canada, from which many mod-chips flow into the U.S., and Spain, where peer-to-peer piracy is running rampant.

Canada was also added to the U.S. Trade Representative's priority watch list this year. If they keep it up, we'll have no choice but to invade.

Higgs got into trouble because he sold modchips that allowed copied and overseas games to be played on Nintendo and Microsoft consoles. In October, Higgs was convicted of 26 antipiracy counts and faced a £1M fine and two years in jail. But a judge ruled in favor of his appeal, which is that any copyright infringement involved here had taken place before the use of the modchips Higgs had sold, and thus the chips themselves do not circumvent copyright protection. Thus, there was no basis for charging Higgs, and he's free, and his legal bills will be reimbursed.

His website is back up, replete with a posthumous Churchillian endorsement of his fight, though it doesn't look like he's taking orders just yet.

Gamespot points out Australia's de facto legalization of mod chips in 2002, when a judge found that mod chips prevented legal activities such as playing backed-up or imported games. That ruling also found that mod chips did not violate laws against circumventing copyright protections.

MrModchips wins appeal in £1million UK modchip case !!![Team-Xecuter, via Gamespot]

NINTENDO ASKS U.S. TO ADDRESS VIDEO GAME PIRACY PROBLEMS WORLDWIDE

Nintendo Calls Out China, Korea, Brazil, Hong Kong, Paraguay, Mexico

REDMOND, Wash., Feb. 14, 2008 - Nintendo of America Inc. has asked the U.S. Trade Representative to encourage specific governments around the world to take a more aggressive stance to combat piracy of Nintendo video games and systems. Nintendo filed its comments under a "Special 301" process, in which the U.S. Trade Representative solicits input from the public to underscore specific areas of concern.

While China remains the primary source of manufacturing pirated Nintendo DS™ and Wii™ games, Korea has emerged as the leader in distributing illegal game files via the Internet. Despite aggressive anti-piracy actions taken by Nintendo, Brazil and Mexico remain saturated with counterfeit Nintendo software. Meanwhile, Paraguay and Hong Kong continue to serve as major transshipment points for global distribution of illegal goods.

"The unprecedented momentum enjoyed by Nintendo DS and Wii makes Nintendo an attractive target for counterfeiters," said Jodi Daugherty, Nintendo of America's senior director of anti-piracy. "We estimate that in 2007, Nintendo, together with its publishers and developers, suffered nearly $975 million USD worldwide in lost sales as a result of piracy. Nintendo will continue to work with governments around the world to aggressively curtail this illegal activity."

Below is a summary of Nintendo's filing:

OVERALL: Nintendo recommends stronger laws in all countries against the circumvention of technological security measures. Video game pirates have developed DS game-copying devices and modification chips to target the security found in Nintendo's hardware systems and allow the play of counterfeit software or games illegally downloaded via the Internet.

CHINA: China must pursue criminal prosecutions against people involved in large-scale piracy operations. Nintendo works with Chinese authorities, who seized more than 1 million fake Nintendo products in China during the past year. But not one counterfeiter has been prosecuted.

KOREA: Nintendo supports the Korea-U.S. Free Trade Agreement, but suggests that it must be ratified immediately to address service providers who are profiting from the uploading and downloading of illegal Nintendo content. Korea is an important market for Nintendo, and Internet piracy is seriously affecting the growth of the video game industry in the country.

CENTRAL AND SOUTH AMERICA: Latin America remains a haven for piracy. Evidence supporting this claim includes escalated violence in Mexico against police conducting anti-piracy raids, extraordinarily high tariffs and taxes placed on the sale of authentic video games in Brazil and widespread corruption in Paraguay. During the past year, Nintendo assisted local authorities with more than 65 actions that resulted in the seizure of approximately 230,000 counterfeit Nintendo games in Brazil, Mexico and Paraguay alone. Despite Nintendo's efforts, the piracy levels continued to rise. Nintendo is calling for significant changes to laws and to the enforcement regimes in those countries.

First up, we have one account of a raid in Ohio via Xbox-Scene - and while I'm sorry the guy is now up a creek without a paddle, supporting one's self via means of questionable legality is never a particularly smart plan:

... I have been out of work since early may, and modding is the only thing that was keeping me above water with the bills. Now I can't mod, and I can't even sell anything off to pay for bills either since it has all been confiscated due to a ludicrous interpretation of the DCMA. Now it's all said and done, and I just have to wait for them to decide what I did wrong, but while I'm waiting, I have NOTHING of any worth anymore, other than a computer monitor, and my car. Because of what happened I'm not allowed to see my girlfriend and our 4 month old daughter, and last night, I slept in my car and my girlfriend sent me a text message telling me it felt like someone was taking me away from her. They took my life away. I would like to formally thank Microsoft and Nintendo for cracking down on the little guy with a soldering iron in his garage, rather than going after the people that are responsible for the bootlegs being available.

Moving on to the nitty gritty, the Console Tech forums have a post with lots and lots of scans: a copy of the search warrant, and a surprisingly small list compared to what they had the scope to seize (and one, count it, one mod chip - hope the government feels that was worth the expense of manpower and resources to seize it). GP points out that "not shown is the probable cause affidavit, which would have explained the government's basis for the search. That document apparenly [sic] remains sealed by a federal court," which is more than a little odd, especially considering the results were less than thrilling. Wonder what they thought they'd be seizing?

And from the Xbox-scene forums comes a long rant that GP describes as "probably the most lucid, detailed and passionate criticism we've seen concerning last week's Homeland Security raids on mod chippers":

The root of the problem is the DMCA. The ideals behind the DMCA are good but the wording really is far too broad... Digital Rights management is being... abused to technologically lock consumers into a fabricated monopoly... our laws work to criminalize anyone and everyone and designed not in the best interests of the American people but in the best interests of politicians and big businesses.

And finally, conservative and liberal blogs jump into the debate. On the right, we have Conservative Gamer, tying mod chips and the illegal alien debate together:

ICE appears to be diverting resources to going after people with mod chips instead of dealing with the illegal alien influx .... How wonderful. It's great to know our government is looking out for us. Next time I hear someone complain about illegal aliens in their town, I'll just remind them that ICE has more important things to do. They'll understand.

And from the left, Freedom Democrats:

The Copyright Mafia is going to greater and greater lengths to take ownership of American culture. First there is the Digital Millennium Copyright Act, which effectively allows electronics manufactures to own our equipment even after they have sold it to us. This past week, we received news that reminded us that the Feds are serious about enforcing this new form of ownership .... And to make it worse, Google and friends point out that several media companies have been deceitfully undermining our fair use rights, by forcefully claiming that such rights do not exist.

Well, at least there's something that all of us can agree on, even if it's not for the same reasons.

Time will tell what the long-term fall out over these raids (and subsequent crackdowns, perhaps?) will be, but the chatter probably won't die down any time soon. What - if anything - of substance was netted from these raids? What is in those still-sealed probably cause affidavits? What's next?

Check out GamePolitics for what I'm sure will be continuing coverage, and to see their take on the articles posted above.

U.S. Immigration and Customs Enforcement agents from nearly two dozen cities executed 32 federal search warrants in 16 states in the past 24 hours as part of a mammoth crackdown on chip modding.

Operation Tangled Web, the result of a year long investigation headed up by the ICE office in Cleveland, is the largest national enforcement action of its kind targeting the sales of modification chips and "disc copyright circumvention devices" in history.

Neither the Department of Justice nor the ESA would name the businesses, homes or storefronts involved in the sweep that took place in California, Florida, Hawaii, Idaho, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, and Wisconsin today.

The modchips and circumvention devices allowed users to play pirated software on the PS2, Xbox, Xbox 360 and Wii.

"Illicit devices like the ones targeted today are created with one purpose in mind, subverting copyright protections," said Julie L. Myers, Assistant Secretary of Homeland Security for Immigration and Customs Enforcement. "These crimes cost legitimate businesses billions of dollars annually and facilitate multiple other layers of criminality, such as smuggling, software piracy and money laundering."

Newly minted ESA chief Michael D. Gallagher was quick to offer federal kudos:

"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."

Now that the threat of terrorism and border safety concerns are a thing of the past we can finally get down to dealing with the real threats to America's borders... dodgy copies of Wii Sports.

Press releases: Jump

ICE partners with industry to launch largest enforcement action of its kind targeting importers and distributors of illegal devices used to circumvent anti-piracy technology in top gaming consoles
32 search warrants executed in nationwide intellectual property rights investigation

WASHINGTON, DC - U.S. Immigration and Customs Enforcement (ICE) agents from 22 offices assisted by representatives of the electronic industry today executed 32 federal search warrants in 16 states as part of an investigation into the alleged sale and distribution of illegal modification chips and disc copyright circumvention devices. This investigation represents the largest national enforcement action of its kind targeting this type of illegal activity.

The search warrants were executed at businesses, storefronts, and residences located in California, Florida, Hawaii, Idaho, Illinois, Maryland, Massachusetts, Michigan, Minnesota, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, and Wisconsin at locations associated with subjects who are allegedly involved in the direct importation, installation, sale, and distribution of the devices that are of foreign manufacture and smuggled into the United States.

The modification chips and circumvention devices allow users to play illegally obtained, pirated and/or counterfeit software on video game consoles including Sony's Playstation 2, Microsoft's XBOX and XBOX 360, and Nintendo's Wii. Modification chips and swap discs for gaming consoles violate laws under the Digital Millennium Copyright Act of 1998 (DMCA). According to the Entertainment Software Association (ESA), the makers of the gaming consoles, game developers, and others in the industry have incurred billions of dollars in losses worldwide due to sales lost to those selling counterfeit and pirated video games.

Counterfeiting and piracy is estimated to cost the U.S. economy between $200 billion and $250 billion annually and results in the loss of up to 750,000 jobs according to the U.S. Chamber of Commerce.

"Illicit devices like the ones targeted today are created with one purpose in mind, subverting copyright protections," said Julie L. Myers, Assistant Secretary of Homeland Security for Immigration and Customs Enforcement. "These crimes cost legitimate businesses billions of dollars annually and facilitate multiple other layers of criminality, such as smuggling, software piracy and money laundering."

As the largest investigative arm of the Department of Homeland Security, ICE plays a leading role in targeting criminal organizations responsible for producing, smuggling and distributing counterfeit products. ICE investigations focus on keeping counterfeit and pirated products off U.S. streets, and on dismantling the criminal organizations behind this illegal activity. In fiscal year 2006, U.S. Customs and Border Protection (CBP) and ICE marked an 83 percent increase in the number of intellectual property rights (IPR) seizures, including 14,675 seizures of counterfeit goods worth more than $155 million, a 67 percent increase from the year before. ICE investigations resulted in 219 arrests, 134 indictments and 170 convictions in intellectual property rights violations.

Between fiscal years 2002 and 2006, ICE agents arrested more than 700 individuals for IPR violations and dismantled several large scale criminal organizations that distributed counterfeit merchandise to nations around the globe. At the same time, ICE investigations into these networks resulted in 449 criminal indictments and 425 convictions. Together, ICE and CBP seized more than $750 million worth of counterfeit goods from fiscal year 1998 through fiscal year 2006.

This enforcement action is the result of a year long investigation conducted by the ICE Office of the Assistant Special Agent in Charge, Cleveland, Ohio.

The names of those targeted, addresses and case specifics are not releasable at this time.

The investigation is being coordinated with the U.S. Attorney's Office for the Northern District of Ohio in Cleveland and assisted by the Department of Justice Computer Crimes and Intellectual Property Section (CCIPS). In addition, ICE has received valuable technical assistance during this investigation from ESA and other industry members.

Video Game Industry Hails Nationwide Piracy Raids In "Operation Tangled Web"
Action Shuts Down Importers and Sellers of Illegal Modification Chips

August 1, 2007— Washington, DC — 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."

The ESA is the U.S. association dedicated to serving the business and public affairs needs of the companies publishing interactive games for video game consoles, handheld devices, personal computers, and the Internet. ESA members collectively account for more than 90 percent of the $7.4 billion in entertainment software sales in the U.S. in 2006, and billions more in export sales of entertainment software. For more information about the ESA, please visit www.theESA.com.

Brown allegedly was turning modding into a business, so it does make sense that the ESA chose pursue a criminal case against him. However, what does that mean for the average kid who just wants to mod their console to play games from other countries? It seems like console manufacturer's have avenues other than physically blocking modders to get them to stop like making every game available to every one at the same time. It's called subtitles. Tell your game developers to use them. Kim Phu

Modder Faces Jail Time After Raid Turns Up Counterfeit Games, Mod Chips [Ars Technica]

Obviously it's in the rumor bin because it's from a forum where only one user has experienced this "problem". If it is true, all that you can do is make a trip down to Home Depot to buy some fancy soldering irons and find some one with some very tiny, steady hands. Kim Phu

Nintendo Shipping Mod-Proof Wiis in Japan]]> http://kotaku.com/index.php?op=postcommentfeed&postId=264378&view=rss&microfeed=true
Oh snap, Nintendo is MAD at you. Maybe they're not yelling at you, but they are definitely wagging a forefinger in your general direction.

The Nintendo Europe site has posted an easily found warning on their homepage about modding your Wii. Let's just say that puppy dogs and rainbows language they usually use for selling Diddy Kong Racing and Harvest Moon is somewhat lacking in their notice:

Modification microchips (mod chips) circumvent the security embedded into Nintendo's products. To install a mod chip into a Nintendo hardware system, it is necessary to dismantle the product and, in some instances, remove components.

The use of mod chips voids the manufacturer's warranty. In addition, the installation of a mod chip can damage the functionality of a Nintendo console, sometimes rendering it incapable of repair. Mod chips have been adjudicated to be illegal in various countries around the world... Most European countries have also already adopted laws prohibiting the circumvention of technological measures for copyright protection. People caught installing or selling mod chips may be subject to criminal charges.

Hide the belts and anything that can be used as a switch! Kim Phu

Information regarding mod chips [Nintendo Europe via Next-Gen]