Xbox Warranty To Cost $1 Billion, Customer Good Will

An anonymous reader writes "The Financial Times reports that Microsoft will take a charge against profits of more than $1bn as it tries to limit the potential damage to its videogames business from a design flaw in the Xbox 360 games console leading to units failing." It's bigger even than that, though. Early this week the news was about Xbox Live's growth, but since yesterday the headlines have taken a turn. Peter Moore has admitted the company is shy of their goal, some 400,000 units short of the 12 million Xboxes they'd planned to ship. These facts combined have made for some grim questions, including the San Jose Merc's Nooch asking why you'd want to buy an Xbox in the first place.

Comments

Obvious answers

[Mr_Silver]

Peter Moore has admitted the company is shy of their goal, some 400,000 units short of the 12 million Xboxes they'd planned to ship. These facts combined have made for some grim questions ...

Unless my maths are wrong, they're 3% shy of their target. Which doesn't seem to be too shabby.

... including the San Jose Merc's Nooch asking why you'd want to buy an Xbox in the first place.

Ummm, because the Wii hasn't got the graphics capability of the XBox? The PS3 and the Wii combined don't have the half of the games portfolio that the Xbox has? That the online gaming for the Xbox is way ahead of the other consoles? That the PS3 costs double that of the Xbox?

I don't own any console but this whole piece just seems to be pointless Xbox bashing to me.

Customer goodwill?

[vigmeister]

Ok. Someone explain to me why this is going to COST MS goodwill. I purchased my Sony laptop explicitly because they were offering returns on their batteries based on a few isolated incidents (not sure if this was legally mandated). That shows that Sony wanted to pretend to do the right thing for the customer which benefits me in the long run. It makes perfect sense to buy an XBox360 if you thought that the price was right before the warranty announcement and fanbois are probably going to be happy about the warranty. Regardless of the high percentage of problems, most customers - >50% - still have a working system and if they do not, eventually will - for 3 years. If your PS3 dies after 15 months, you suck on it. Eventually, all that matters is the image and how much you think they will do in the future to keep that image up. And I think this is a + for MS in my book.

This is Dr. Evil's doing

[Megane]

"Hello? Microsoft? I have had one of our agents place a flaw in your Xbox 360 video game system. It is a simple flaw, easily fixed, but only if you know what it is. I shall give you this information if you give me ONE MILLION... What was that? Oh, really? That's good to know, thanks. (ahem) I shall give you this information if you give me ONE BIIIIIIIIIILLLLLLLLLLION DOLLARS! Muhahahahahaaaaa!"