Microsoft Mans Up on the RROD

A Red Ring

In a stunning move Microsoft has owned up to it’s responsibility for all the Xbox 360 red-ring-of-death failures. Peter Moore has informed us, the great unwashed masses, that the 360 warranty is now extended to 3 years regarding the RROD issue specifically. They’ll also be reimbursing anyone who paid to have their 360 repaired because of that issue.

As of today, all Xbox 360 consoles are covered by an enhanced warranty program to address specifically the general hardware failures indicated by the three flashing red lights on the console. This applies to new and previously-sold consoles. While we will still have a general one year console warranty (two years in some countries), we are announcing today a three-year warranty that covers any console that displays a three flashing red lights error message. If a customer has an issue indicated by the three flashing red lights, Microsoft will repair the console free of charge—including shipping—for three years from the console’s purchase date. We will also retroactively reimburse any of you who paid for repairs related to problems indicated by this error message in the past.

This is a very wise move for Microsoft. They’re finally doing something about an issue that’s been getting them a lot of bad press. This was their only visible weakness and was beginning to undermine consumer confidence. It’s a shame that they were spouting “I would go back and say the vast majority of people love their experience. We continue to go back and address all of these issues on a case by case basis. There is a vocal minority out there. We go off and try to address their issues as quickly and as pain-free as possible” (said Todd Holmdahl, Microsoft’s corporate vice president of Gaming and Xbox Products Group), when the reality was:

We have been following this issue closely, and with on-going testing have identified several factors that can cause a general hardware failure indicated by three flashing red lights on the console. To address this issue, and as part of our ongoing work, we have already made certain improvements to the console.

Since they eventually admitted to the problem, why the months of spin? Why not just admit that you’re investigating it? Is corporate spin so important?

Also interesting is that the “$1.05 billion to $1.15 billion pre-tax charge to earnings for the quarter ended June 30, 2007 for anticipated costs under its current and enhanced Xbox 360 policies”, factored for units shipped, works out to around a 23.7% failure rate, using the projected shipped figures for the end of June. That’s assuming that Microsoft pays full retail for their units. They might pay less, or they might be absorbing a loss. Without hard data that’s the best projection of the actual failure rate I can come up with.

This is going to cost the Microsoft mothership. That’s gotta sting, especially since the Xbox group is deep in the hole and has yet to turn a single dime in profit. Unless they start making serious money soon the investors might just demand that the plug be pulled on the whole Xbox division. I’d hate to see the only competition in the console be between Nintendo and Sony. I like having a gaijin in the fight, even if it is a twice-convicted monopolist.

Now we just gotta raise some stink about the adverts and the pay subscription. Let’s do it now before they sober up.


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