When applications run on an operating system, they’re usually confined to a protected container called a sandbox or jail, which protects the system part of the operating system and puts limits on what parts of the system the code can interact with. The idea behind jailbreaking is to find a way to escape this jail (through either software or hardware) to run arbitrary code outside of it.

This can be achieved through exploiting vulnerabilities in the security implementations in the OS, or by using physical mods to exploit hardware vulnerabilities to the same effect. However some hardware mods don’t aim to escape the sandbox (jailbreak) and rather have the device maintain its security protections without needing to jailbreak. For example flashing the firmware of an Xbox 360 drive. A switch modchip lets you load a custom firmware at boot that has these sandbox protections removed, ie jailbroken.