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Emmanuele Lusinchi has posted a new article on the Star Wars: The Old Republic forums that goes into pretty decent detail on how items will be modified in the game.
The post was written in response to the last patch notes published in which Lusinchi remarks, "So, it turns out some of the patch notes regarding our modding system were probably poorly written (by me, I must add) and generated quite a lot of concern. I’ll try to explain the changes better and, while I'm at it, explain the logic for those changes."
Lusinchi goes into great detail about what was wrong with the system including such things as too many modifications that had to continually be upgraded every few levels which, he opines, "was a pain in players' backsides".
Then Lusinchi outlines all of the forthcoming changes to customization including: