I've never really used mod chips on my consoles, I've just never really felt the urge to use one. I know people that do so they can play imported games and various other things. I've never seen a problem with using them, they can enable you to do some pretty cool stuff. Apparently, Nintendo doesn't quite see it that way.
They have already gotten several countries to ban them entirely; now they have posted a large warning on their Nintendo Europe website against the use of such devices. “Modification microchips (mod chips) circumvent the security embedded into Nintendo's products. To install a mod chip into a Nintendo hardware system, it is necessary to dismantle the product and, in some instances, remove components.”
They even go as far as to say that if they catch you using or selling them you will be subject to criminal charges. All that just because we want to play an imported game? Just make your systems region-free and many people won't bother with them.
Nintendo Europe Talk Big On Mod Chips [via kotaku]