most are phishing, or morons giving account info

some are brute forced, which is a computer program guesses your password, the longer your password the longer it takes, and if you have a number/capital letter along with just normal letters it gets more complex.

a very very small number are truly hacked.

This. It happens a lot because people are not aware of how the internet works.

The fun thing is: I do and work with internet every day but somehow my LIVE account was hacked like 2 years ago. I must admit, though, that password was hella old and might have slipped through some other site that didn't have proper safety on its database.

There are now several ways to secure your account, like those codes you get sent to your email or phone to verify a new device logging into your account. And if you don't go the crazy way and save your credit card info on LIVE you're all good (I mean, think about how bad other MS products are. Do you really want them to have lots of important info?). Microsoft even is quick in blocking hacked accounts and helping you to get it back without lost or changed data. (Quality of support depends on country, of course.)

Live ID get hacked, since the XBL password is the same as your Live ID meaning that if someone gets your hotmail account then they also have access to pretty much everything you have that is related to Microsoft, and that includes the xbox. Of course there are people stupid enough to give out their emails in an attempt to gain some FREE MICROSOFT POINTZ!??!';one! So naturally those idiots essentially give out the address to their house to strangers, and then it's just the matter of finding a key.

That's interesting.  I've never had to recover my info on an Xbox 360 because I just move from console to console with my Flash Drive.  I've only had the one PS3 this whole gen and I've never signed into another.  I do have my CC info saved to my PSP and I used to just purchase stuff directly from the PSN.  Also, with my Vita, all I ever had to do was log in as d21lewis and all of my purchasing info was right there, too.

My guess is that kind of exploit is a very, very small part of the total.  Most of what was outlined in that article is going to fail most of the time.  Generally speaking, you'd probably have to call dozens of times to get an account that way.  The email part, especially, would send off dozens of red flags.

Getting enough information on someone to access their account, however, is not that hard.  You can get most of what you need for verification off a person's Facebook page.  Gamertag, name, phone number, address, then use that to grab the rest.  There are also all the re-used passwords out there that come from elsewhere.  The vast majority of compromised accounts come from consumers not being careful enough.

I think its about time I come up with some new passwords then, been using like 3 different passwords for as long as I can remember :P