The offender, who has not yet been named, had developed a new method of modifying Microsoft Xbox consoles, discovered in October 2004 by an "Internet Investigator" for ELSPA, the Entertainment and Leisure Software Publishers Association. ELSPA informed Caerphilly County Borough Council Trading Standards and Gwent Constabulary.
A chipped console will play pirated games and games purchased legitimately in other regions of the world. The man prosecuted had sold the chipped Xbox consoles for £380 on his website after fitting them with a 200GB hard-drive and 80 pre-installed games, a package that would cost around £3,000 at retail prices.
Mike Rawlinson, deputy director general of ELSPA, said: “This case sets a major precedent which marks a milestone in the fight against piracy and in protecting the games industry’s intellectual property."
He added: "It sends a clear message to anyone tempted to become involved in ‘chipping’ consoles that this is a criminal offence and will be dealt with accordingly. The modification of consoles is an activity that ELSPA’s anti-piracy team is prioritising – it is encouraging to see the UK courts do the same.”
The penalty imposed yesterday was a 140-hour community service order to be carried out in the next 12 months, £750 costs, and forfeiture of all equipment seized (including three tower PCs, two printers, three Xbox consoles and 38 hard-drives). ELSPA said it was a lenient sentence that reflected the man's youth and the fact that it was his first offence.
The modification of consoles has been an illegal practice since 31st October 2003 when Regulations were passed that made an amendment to the Copyright Designs and Patents Act.
The new regime allows rightholders to take action against individuals who circumvent what the law calls Technological Protection Measures, or TPMs, to make unauthorised use of copyrighted works. Action, including criminal action, can also be taken against those who make and distribute equipment designed to circumvent TPMs.
Accordingly, the whole process of chipping consoles illegal, including selling and advertising chips as well as providing a service for chipping.
Relying on these rules, Sony Computer Entertainment Europe won a High Court ruling in July 2004 against a British seller of mod-chips which could be used to bypass the regional and piracy protections on PlayStation 2 consoles.
ELSPA also warns that the chipping process, which enables counterfeit games to be played on a console, leaves the consumer with no recourse under any guarantee from the manufacturer and can damage the console.
