Homebrew Utilities
Placing a modchip in your console gives you access to what is referred to as "homebrew" applications. For example, with the Wii, which divides its functions into "channels," you can create a homebrew channel to run a wide variety of cheat code programs, Internet browsers and other utilities. With the right set of applications, you can turn your video game hardware into a small, inexpensive computer that also plays console games.
Media Center
A recent trend in computer hardware is the home theater PC, a small, compact computer designed to connect to you television and act as a media center for music, movies, HDTV and other files. A modchip-equipped gaming console can function as an even more compact and cheaper HTPC using the built-in hard drive and imported media players. By combining your media files with your homebrew applications, you can stream HD-quality movies without needing to actually build or purchase a separate computer.
Backups
Video game discs can become scratched or otherwise damaged from repeated use over time, poor storage or simple accidents. Retailers and publishers will often refuse to replace damaged discs, even if the console is responsible for the damage. In this case, you can use your computer's DVD burner to create backups of your games and store the originals safely. However, in all major consoles, you cannot play these backups without a modchip. The savings from not having to replace damaged games will quickly pay for the cost of installing the modchip.
Emulators
Modern consoles come with the ability to purchase and download older, out-of-print games from an online library. However, none of these consoles possess an all-encompassing library. In case you cannot find or purchase the game you want, you can use a modchip to enable the installation of a hardware emulator to virtually play ROMs, or cartridge image files, of classic games. Remember that downloading a ROM image of a game you do not already own in its original form is considered software piracy and is illegal.