i have been looking for a mod chip for my xbox and i saw that some are xbox live compatible does that mean i can play my backups online or i can like switch the mod of to play my originals?
It means you can switch the chip off (disable it). If you try using xbox live with it on or with a bigger HD, you could be banned, for life. If you want to play online with the modchip, use xbconnect. And its free...
