A firmware hack is developed by a third party programmer. It is not authorized by the manufacturer. A hack typically resides in a memory card. When a hack is uploaded to a digital camera, it modifies the software. It increases camera functionality, such as adding a RAW file format to a camera.
Turns out, it depends on what camera you own By James DeRuvo (doddleNEWS) We’ve heard a lot about hacking a camera’s firmware lately, thanks to Magic Lantern recording for Canon DSLRs. But many may be wondering how does that affect your camera’s warranty? Well, it really just comes down to what camera you own as to what you’re willing to risk to boost its performance via a third party firmware hack. If you just bought a Panasonic Gh3, I wouldn’t be putting on the until your warranty expires. Likewise, if you own a, and are eager to tweak what hacks may be offered to boost it’s video performance, I’d think twice. But if you’re a Canon user? 
Well, not so much.
In fact, you may be in the clear sort of. The thing that companies have learned, is that thanks to the decision of the Library of Congress, which stated that users of technology have the legal right to change the products that they buy (we’ll call it the iPhone Jailbreak decision), it’s become more fashionable for hackers to dive into smartphones, cameras, and who knows what else and to hack them to do things that they weren’t designed to do. And the manufacturers have little, save one to void your warranty.
That’s what Apple has threatened with the iPhone (although they can’t really prove a jailbreak due to the fact that a simple restore will wipe any change out), but have yet to void anyone’s warranty yet. The irony is that Android’s are infinitely hacked (called “rooting”) and Google actually encourages it, even if the handset manufacturers don’t.
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And with cameras we’re seeing the same thing. The first such hack, was Panasonic’s GH2 Driftwood hack, which got a lot of attention last year when the GH2 got high praise during the. Even Francis Ford Coppola said the image was impressive. Panasonic remained mum about the Driftwood hack for a long time, but have since gone of record that any attempt to alter the camera’s firmware will void the warranty. Drawing a line in the sand, Panasonic is very clear “if you do proceed to use this option your warranty will be voided.” takes a similar tack, declaring that “ using a firmware version from an unknown source will void your warranty.” That kinda pours water on, whose stated goal is “improvement of Nikon DSLRs through hardware, software, and firmware enhancements.” But you can’t really blame Nikon for it. Trying to flash your firmware is dangerous business.
As one poor user of a D5100 found out a few days ago when he tried the Nikon Firmware hack from NikonHacker and – “bricked my camera trying a patch, and for one reason or another was not “good.” You can’t really expect Nikon to take the camera back and give you a new one when you kill the camera. So this poor soul is going to have to pay a bundle repair or more likely replace it. Canon cannot support the use of any third party firmware replacement, and if the camera is damaged by the use of such a firmware, then the repair may not be covered under the warranty. There is no such thing as “voiding” the Canon warranty, there are simply repairs that are covered, and those that are not. Canon, on the other hand takes a more hands off approach, and this may largely be due to how Magic Lantern has approached hacking the firmware.
They haven’t replaced it, so much as figured a way to bypass it with a firmware loaded on the data card. All one has to do at that point is go into settings and alter where the camera looks for the firmware itself. It’s non-destructive and users can go back to normal at any time, much like restoring an iPhone. So, in the end, Canon is a tad Laissez– faire about the whole situation, choosing to day that “if” something happens and they determine a repair won’t be covered under warranty, then you’re on your own. So, the warranty would only be voided based on how the camera was affected by the hack itself. Every other feature of the camera would still be covered under the terms of the warranty. And that’s a good way to go.