The organisers behind a project to make the Linux operating system work on Microsoft's Xbox game console have announced that an anonymous donor has volunteered to give US$200,000 to programmers who can complete the task by the end of this year. The move highlights the growing enthusiasm among amateur programmers for working on the US$200 machine Microsoft introduced late last year. However, it is not an enthusiasm that Microsoft endorses or encourages, though the programmers claim what they are doing is completely legal under the reverse engineering clauses of laws such as the United States' Digital Millennium Copyright Act. The Xbox is sold officially in the US, Europe, Japan and Australia. Grey-market versions are also available in Hong Kong and other Asian markets, and Microsoft spokesman Olivier Richard said more details on selling Xbox in these markets would be available in the coming weeks. The lure of the Xbox for hackers is its powerful hardware, which includes a 733 megahertz Intel chip, graphics card, hard drive, DVD player and support for broadband Internet. Microsoft has bundled these together and sold at a loss, hoping to recoup its investment through packaged games and online subscriptions. The people behind the Xbox Linux project see the machine's potential for being a very inexpensive computer and Web server. Andy Green, who is involved in writing a Linux-based basic input output system (BIOS) for the Xbox, said a few hundred bytes of Microsoft's original code was still required to ensure that Linux could run on the Xbox. 'This is compared to 256,000 bytes of the original Microsoft BIOS. I do not think the case can be made that our project is substantially based on the MS BIOS.' He saw the project as being distinct from other efforts aimed at changing the Xbox so it will run unsigned code or pirated games. Such fine distinctions could affect whether or not Microsoft would be able to stop the Xbox Linux project. Mr Richard said he did not know whether Microsoft would take legal action against the group, but added: 'For the sake of consumers we really want people to use the machine as it is. Most manufacturers will tell you that the warranty only applies if you don't open it up. Xbox is no exception.' The Xbox ships with a version of the Windows 2000 operating system and complex encoding routines prevent non-Microsoft-endorsed software being used. However, Xboxes that use additional chips to bypass some of these routines have been available for the past month or so, and a graduate student at the Massachusetts Institute of Technology has published a paper on how the Xbox's security measures can be defeated. At least one maker of the 'mod chips' has stopped manufacturing, leading to speculation that Microsoft has put legal pressure on Xbox tinkerers. Sony's popular Playstation console has also been the target of programming by Linux hobbyists. The company this year reversed its resistance to the Linux efforts and released a Linux kit for the Playstation. Michael Steil, also of the Linux project, said Microsoft had not contacted the organisation. 'I do not think they will, because what we do is perfectly legal, so they can do nothing about it.' Until now, small bits of programming have been contributed by volunteers and updates are available at the project's site. Xbox game programmers who have access to Microsoft's software development kit (SDK) for the console should not enter the contest, the site said in its rules: 'Don't use the Xbox SDK. If you are a game programmer with NDA [nondisclosure agreement] knowledge of Xbox details, don't participate. 'Half of the US$200,000 is earmarked for those who can make Linux run on a chip-modified Xbox, while the other half is for programmers who can make Linux run on Xbox without any kind of modification.' When modified Xboxes and mod chips that could be self-installed appeared on the market, analysts said they would not hurt the sales of legitimate Xboxes or Xbox games. Altering the Xbox is too complicated for the casual user, but enthusiasts have been excited about the possibility of running homemade games and older arcade games on the modified consoles, and sites dedicated to hacking the Xbox have sprung up across the Web. Some of the mod-chip distributors found on the Internet are companies based in Hong Kong, leading to speculation that the chips are being designed in the region and manufactured in Southern China or Taiwan, though their exact origin is still a mystery. Recently, a group calling its chip the Enigmah-X stopped making its products. Its home page gave no reasons but a message there indicates just how many mod-chip efforts there have been: 'This site is now closed. Good luck to all teams who like to make fun things with Xbox. We are not affiliated with xtender, messiah, openbox, pandora, xecuter, xchip or anyone else.'