If your stupid enough to hack your system and then take it online, you deserve this kind of punishment.

This will not stop any pirate, just keep them offline for a while until they obtain a replacement box. The cost of replacing a banned box isn't what people here seem to think, check ebay prices for faulty consoles with no accessories. $30 and a week or two later they'll be back up and running and the fact that they didn't cost a fortune for the new one means they will not care if the box is banned after a few months, they'll get their money's worth in the games they will steal.

The fact that you cannot take your HDD from a banned console to legit is great though and will stop people from benefitting with achievements and gamerscore on their Live accounts.

For the record I have seen zero evidence of any modified HDD user being banned yet so unless you guys have proof you're just trolling imo.

The sad truth is that we'll never be able to actually stop pirates; it's just one of those things that will always be around.

That said, what we can do is inconvenience them and if the inconvenience becomes big enough, just maybe we can make it not worth the trouble.

I completely disagree with the steps Microsoft is taking. It's my xbox, I should be able to do with it what I want. They is a limit, but still, it's similar to owning an ipod touch and jailbreaking it.

Indeed you're right, I do find it hilarious reading tales of these pirates crying about getting a punishment they deserved.  If you're going to steal off a company then at least have the balls to accept when you're caught and stfu.

@mike & ps3-salesIf you read the EULA that comes with a game or console they usually state that you've purchased a license to use them, not the product itself.