Unlike other Xbox Live games that use peer-to-peer hosting, Sega and From Softworks decided to use their own servers to handle the Chromehounds load. Unfortunately, while that led to fantastic online play, it also costs money. With the limited amount of players running games online, Sega has made the call to kill the online portion of the game January 6th, 2010.
The Chromehounds saga is a tragic one, an outstanding game that never found the audience it deserved. Its concept of a three-nation war was fantastic, and the customization was incredibly deep and complex. That complexity may have led to players being turned off, and a non-existent single player hardly helped players realize what the online segment offered.
Making the closure worse is that Sega offered downloadable weapons, and those are now useless. There is no compensation being offered, but does show that you should purchase virtual items with care. Fans will want to take January 6th off so they can enjoy the final moments of one of the best things to ever happen to the 360 that no one knows about.