The bans won't stop there, either. Rumors indicate Microsoft is aiming to shut off upward of 1 million consoles before the end of the year -- it seems likely that the company may target Europe or another large region next. This hasn't made things easy on Microsoft's call center, which is getting inundated with calls from angry customers. Microsoft's goal is to get all modded consoles off their network to cut down on piracy.
Not all hope is lost for the shunned, though. It seems that Redmond has gone after the console itself, and only prevented it from connecting to Xbox Live. The consoles still function, and the accounts in general appear to be still active, so if you are desperate for online play and don't want to fight Microsoft on it, you can always buy another 360. That's certainly not what many people want to hear, particularly those who view console modding as a right.
This mass banning will undoubtedly renew debates about whether or not hardware modifications should be permitted. Of course, since Xbox Live is an extended service, Microsoft certainly does reserve the right to kick people off -- and this is an example of them demonstrating they are willing to let people go.