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Microsoft Acknowledges 360 Issues, Extends Warranty to 3 Years
RamblinLonghorn writes "Microsoft has announced that they are extending the warranty for all Xbox 360s to 3 years. This appears to be entirely retroactive and that 'those who have already paid for such repair charges can expect reimbursement checks for the amount of their console repair.' It seems as though Microsoft is accepting the blame for the hardware malfunctions, but it is worth noting that this warranty modification only applies in the 'Red Rings of Death' situation."
...and for those of us who have no idea wtf the "red rings of death are", see here
(Posted anonymously to avoid karma whoring)
I'm not normally a fan of MS, nor do I own a 360, but this is a great move by Microsoft - and not something they NEEDED to do. They could have just fixed the problems and made it a year or so but by extending this to a three year warranty (retroactive) they are going to save a lot of people money.
Companies like GameStop who sell extended warranties though might not be happy since I certainly wouldn't buy one now that MS is backing their system up for 3 years.
Assuming they just do full replace and junk, and pay full retail price, that is >2.5 MILLION failed X-Boxes in the next 2 years. Assuming each repair costs Microsoft only $200, they are budgeting for 5 MILLION failed x-boxen!
With only 11 million X-boxen shipped, that 33% failure rate is sounding like an UNDERCOUNT!
Test your net with Netalyzr
They dont shell out a new console, they ship you a refurbed unit.
Give them a CC# and they'll cross ship (send your refurbed unit out right now, before they recieve your return).
Then they fix yours, and put it in the pool to be sent to someone else.
It's how RMA's work.
I don't need no instructions to know how to rock!!!!
> You have three choices, nintendo ... xbox ... and finally the sony PS3,
You forgot one. There is the PS2 as well. It's a decent, fun system and you can still buy games for it. It's not to be totally ignored just yet.
I'll probably be modded down for this...
Quality control / reliability is the issue. How they handle it is at best damage control. The most they can hope for is people thinking "They really screwed the pooch there, but at least they agreed to adopt the puppies." As for stepping up with the warranty did they really step up or is this a preemptive step to avoid a large (and expensive) class action lawsuit.
"Good things don't end with eum, they end with mania or teria." - H. Simpson
MS have really impressed me with the way the handle most of the issues (with a few noted exceptions which any large company will have). Although they tried to supress the fact that they were having issues, they have now admited it, and in good faith. They extended the warranty to show good faith, not because they were obligated to, or had to....
If they initially lied about the issue and worked to cover it up, then *nothing* they subsequently do can be considered "in good faith".
They tried to scam people, got caught over a massive design failure, and are now doing damage control.
Good faith would have been noticing the issue first and working to ameliorate the damage they caused.
Going into damage control mode after being caught lying is not in any way "good faith".
It's amazing the shit people will willingly lap up these days. Truly bizarre.
The most amazing thing to me is that according to these figures the PlayStation 2 sold 188,000 units during May So the old gen PlayStation outsells the nextgen Xbox 360 and the PS3.
Top selling hardware for may is:
DS 423,000
Wii 338,000
PSP 221,000
PS2 188,000
Xbox 155,000
PS3 82,000
GBA 80,000
Even funnier. Handhelds are more popular then the big nextgen wonders.
I work for a high tech company that makes expensive hardware, far pricier than the xbox, and I've come to understand a lot more about the cost of warranties from the supplier end. Extending warranties is essentially a loss for the the manufacturer - you're essentially betting when what you made will fail. That's weighed against the cost of making more durable components and the cost that a customer would not buy your product in the first place.
When the 360 first came out, someone made a decision that beyond one year it would cost the company too much to repair the consoles relative to the increased sales than would be had by having a longer warranty. They also had to take into account the bad publicity that could (and did) occur.
I'll be pure engineer here - someone at Microsoft redid the formula, given the knowledge of failures that have happened since release. This time around, the math said that enough future sales would be lost to outweigh the cost of extending the warranty. It's really that simple. It's also interesting to note here that they didn't make it a lifetime warranty (20 years or something). They probably ran that formula too, and decided that the math tips the other way if you let it last forever.
So did they NEED to do this? If by need you mean "saving face", then no. Being the retrospective hero doesn't help anything, only in the sense that it might affect future sales.
I'm astonished to read so many "mine is okay, except a game doesn't work" or "no problem so far, only a broken dvd drive" comments. Don't be so forgiving! This is a game console, not a PC. There's no reason why it should break within such a short timespan! I've bought dozens of consoles, and all of them still work. Some of them are over 20 years old!
The formulas used to calculate warranties are meant to cover manufacturing errors. Every once in a while, a defective unit will get past quality control in the factory due to human error. The warranty is designed to protect customers if they get one of these units.
The "Red Ring of Death" is likely from a design flaw, not a manufacturing error. A manufacturing error would not account for the abnormal failure rate. It is literally built into every unit that leaves the factory. The only long-term solution to a design flaw is a product recall.
Extending the warranty is just a temporary solution because Xbox 360s will continue get the "Red Ring of Death".