Xbox 360- 3 years warranty
 

Thu Jul 5, 7:11 PM

SEATTLE - Microsoft Corp. said Thursday it expects to spend more than $1 billion to repair widespread hardware problems in its Xbox 360 video game console after a large number of them broke down.

Microsoft said it would extend the warranty on the Xbox 360 to three years after too many of the consoles succumbed to "general hardware failure," but the company provided few other details about the extent of the problems.

"We don't think we've been getting the job done," said Robbie Bach, president of Microsoft's entertainment and devices division, which also makes the Zune digital music player. "In the past few months, we have been having to make Xbox 360 console repairs at a rate too high for our liking."

Bach said the company made some manufacturing and production changes that he expects will reduce Xbox 360 hardware lockups, but he declined to identify the problems or say which others might remain. Microsoft said it will record a charge of up to $1.15 billion for the fourth quarter to cover the additional costs associated with the warranty extension.

Matt Rosoff, an analyst at the independent research group Directions on Microsoft, estimates that Microsoft's entertainment and devices division has lost more than $6 billion since 2002.

Microsoft has written down larger amounts in the past _ more than $10 billion in the late 1990s related to investments in telecommunications companies, and more than $5 billion related to antitrust issues _ but a $1 billion write-down for one division in one quarter is significant.

"It suggests the problem is pretty widespread," Rosoff said.

Microsoft will pay for shipping and repairs for three years, worldwide, for consoles that experience hardware failure, which is usually indicated by three flashing red lights on the front of the console, something gamers sometimes refer to as "the red ring of death." Previously, the warranty expired after 1 year for U.S. customers and 2 years for Europeans.

Microsoft also will reimburse the "small number" of Xbox 360 owners who have paid for shipping and repairs on out-of-warranty consoles, Bach said.

In June, bloggers speculated that the Xbox 360 return problem was getting so severe that the company was running out of "coffins," or special return-shipping boxes Microsoft provides to gamers with dead consoles. "We'll make sure we have plenty of boxes to go back and forth," Bach said in an interview.

Microsoft's entertainment and devices division reported an operating loss of $315 million on $929 million in sales for the three-month period that ended in March.

yeah I won't get my money back.

on xbox.com this letter was posted.

"Open Letter From Peter Moore
To our Xbox Community:

You've spoken, and we’ve heard you. Good service and a good customer experience are areas of the business that we care deeply about. And frankly, we've not been doing a good enough job.

Some of you have expressed frustration with the customer experiences you have had with Xbox 360; frustration with having to return your console for service after receiving the general hardware error message on the console.

The majority of customers who own Xbox 360 consoles have had a terrific experience from their first day, and continue to, day in and day out. But when anyone questions the reliability of our product, or our commitment to our customers, it's something I take very seriously.

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.

We are also implementing some important policy changes intended to keep you in the game, worry-free.

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. In doing so, Microsoft stands behind its products and takes responsibility to ensure that every Xbox 360 console owner continues to have a fantastic gaming experience.

If we have let any of you down in the experience you have had with your Xbox 360, we sincerely apologize. We are taking responsibility and are making these changes to ensure that every Xbox 360 owner continues to have a great experience.

This will take a few days to roll out globally, and I appreciate your continued patience as we launch this program. I've posted an FAQ that should address some additional questions, and we'll update it over the next few days.

I want to thank you, on behalf of all us at Microsoft, for your loyalty. "