Great news, microsoft is not implementing any way of detecting modchips. Taken from lik-sang:

On a recent news on C|Net, a Microsoft representative said Xbox Live would not include specific diagnostics to detect Mod Chips but would employ "military-grade security" to prevent hacking and other threats. The representative declined to specify any action Microsoft was taking against mod chip makers but said the company would vigorously protect its intellectual property.
This means XBOX Live will be perfectly safe for modded XBOX-Systems and all what Microsoft does is trying to protect the gaming network from cheaters and similar hacking attempts, This is great news for all Xbox owners with Mod Chips as well as those who thought about ordering one but were unsure about problems with online gaming.

Well, I would rather get it for free than pay them for online game play. You know, gamespy.com or xbconnect.com or whatever comes up.

Who said this though "a ms rep" sounds like anyone could have made it... I am wise to be unsure, but its good news none the less

Originally posted by Meerdorf
Who said this though "a ms rep" sounds like anyone could have made it... I am wise to be unsure, but its good news none the less

VERY, VERY true. This could be a cunning plan by MS. Lets see.....

Well, its thin ice for MS.... Do they stop all the modded folks from paying 50 big ones or do they admit that there will always be modded xboexes and cut their losses and try to recoop some more money? 1, from the ORIGINAL game and 2. from the price of xbox live?