My guestbloggers exceeded my expectations.
Frankly, there's very little left for me to talk about.
The first full-fledged mod I played was the Aliens: Total Conversion for Doom. Every level, texture and model was crafted so finely that I felt the new age of videogames dawning. I searched the web for the myriad mods I was sure were just begging to be downloaded. I found then the same thing I find now: thousands of unfulfilled announcements, one or two novel gametypes and a whole heap of "realism" mods (isn't this one-trick pony beaten well past liquefaction?).
I have considered the effects of success on the mod community -- a strange kind of quickening, bigger teams, actual budgets, greater assets. This seems to mirror the escalation of the commercial gaming industry. They grow in tandem.
Mods are often made ever more precarious by two factors: distance separating team members and lack of money. That's right, I'm blaming lack of money for the downfall of indie projects.
There is definitely an incentive to cut one's teeth on modding in order to boost a portfolio or touch a sliver of fame, but it's very easy to blow off a project when there's no money involved -- especially if you're, like most people, overworked anyway. And when the team members may be separated by thousands of miles, it can't be too hard to drop them like hot potatoes.
Mods also suffer from a delusion common in the game industry -- the notion that they can just make a game. As if all the boring details of process and management will just slot into place. You can see this all over the gaming boards, people begging for level designers, coders, modelers, gratefully unaware of the rigors and discipline required (and, often, english syntax).
And even if a team and plan are assembled, people may quickly become disillusioned by the notion that working on creating something fun isn't always a fun process.
I've talked on this site about the need for robust, interconnected game-authoring tools. Developers seem to be realizing this more and more, but they still allow certain gaps to exist in order to fit a stereotypical asset-management pipeline.
I found the Hammer editor fairly easy to use -- for 3d level authoring and physics tinkering.
But for everything else it's surprisingly obtuse. Setting up a mod requires fiddling with multiple folders. Making textures requires editing specialized text files. Screen overlays require coding. Scripting an RPG-style interface would demand kung-fu much greater than my own. They threw modders a bone with their special version of XSI, but it would have been great to make a special add-on for an open-source product like Blender. The whole process is just far too fractured.
To really check out a mod that has blown away anything I've seen in the past, check out Garry's Mod.
Modding is seen, and will continue to be seen, as a way for small budget teams to break into the industry, in the same way that indie films are seen as a springboard to Hollywood. I can also see big-budget studios getting into the mod business as a way to supplement their income in off-years by having small teams put out new content rapidly and at more favorable prices for consumers, just like Hollywood studios often run independent film companies.
Budgets will keep increasing at all levels. I'd like to think that large gaming studios will look at the sloppily-run Hollywood model and try to inject some sense into their operation.
But I highly doubt that will happen.