How much of a threat are mod chips to game publishers?
Quite a big one, according to U.K. newspaper The Independent. A lengthy article from today's edition deals primarily with a Nintendo DS mod chip known as the R4:
The R4 is a tiny Chinese-made device – costing around £14 – that for more than seven million owners of Nintendo's hand-held console, the DS, has blown wide open its capabilities. Combined with a small memory card and plugged into the back of the DS, it enables the console to play MP3s and videos, as well as store copies of games you already own.
Crucially, however, it also enables the user to play pirated games from the internet [which] can be downloaded for free. Add to this that it's simple to use, and available through retailers such as Amazon, and you can see why the R4 and devices similar to it are bringing video game console piracy to the mainstream.
Enabling a DS to play digital music and video is a wonderful thing. Obviously, playing pirated games is not.
In mentioning Amazon, the article is believed to be refering to Amazon UK. Mod chips are illegal in the United States under the terms of the Digital Millenium Copyright Act (DMCA). An English appeals court, however, held recently that the devices do not infringe on copyrights in and of themselves.
On the other side of the coin, British parent Nick Welsh explains why the R4 is attractive:
The trouble with kids is you pay £20 or £30 for a game, and they could only play it once. Let's say I sit down and download 10 new games, the way it ends up is they'll only really play one or two or those, and the others get replaced. I wouldn't be able to afford that number of games.
You can have 70 or 80 games on a 2GB card, and they're all on the back of the machine. There's no fiddling around with cartridges – it's all there to hand... If there was some sort of iTunes equivalent where it was relatively easy and you could try a game for a week for a quid, and pay another four quid to keep it, then I think it's likely I would use it.
In addition to publishers, some game retailers are concerned about the popularity of the R4, which they link to declining sales of DS game cartridges.