Microsoft facing a bill of more than $1bn to cover costs of extended Xbox warrnaty

[Zeus]

According to the BBC, Microsoft has stated that is facing a bill of over 1 BILLION DOLLLARS to cover the cost of its newly announced Xbox 360 warranty extension. The company also admitted it has been forced to make in their eyes an unacceptable number of repairs to the console after key hardware failed.


Microsoft has said that it is facing a bill of more than $1bn to cover the cost of offering extended warranties, after failings with its Xbox 360.

The company admitted it had been forced to make "an unacceptable number of repairs" to the consoles after key hardware failed.

Customers who suffer the problems will now be given a free three-year warranty, the company said.

The failures are indicated by three red flashing lights on the console.

Microsoft, has not revealed how many of its machines have suffered the problem, but said the number was "bigger than we are comfortable with."

It added that the move - which will also see some people reimbursed for postage and repairs on consoles which were out of warranty - was aimed at keeping the loyalty of its customers.

"The majority of Xbox 360 owners are having a great experience with their console and have from day one," said Robbie Bach, president of Microsoft's Entertainment & Devices Division.


News Source: <a href="http://news.bbc.co.uk/1/hi/business/6275728.stm" target="_blank">BBC</a>

[ando2k5]

i own a 360 and i'm glad to say that so this should of happened too many faults about time they sorted the problem out and got there asses moving

[sabata dark]

Looks like bill gates pools gonna be filled with 20's rather then 100's for awhile

[Nikeplektrum]

This is costs for not getting paid for repairing their own broken hardware?

Still pocketchange for ms

[funnybutrandom]

brought it on themselfs realy :rolleyes:

greedyness doesnt pay

[xllzerollx]

that money they made already by 3 red lights 360 owners buying new systems and repair money, so what they complaining about?

[Scorpion3]

I still haven't gotten my check from them when they announced the 1 year upgrade. Well, I did but they didn't give the right amount so I haven't gotten the difference back.

[c4dm4n]

that money they made already by 3 red lights 360 owners buying new systems and repair money, so what they complaining about?


That's true.. and better than that they can say they have sell 11 millions units...:rolleyes: hmmm...

[Covert Knight]

Geez, looks official now. I'm sure there are some guys screaming at some others in a microsoft corporate head meeting or room asking what the h*** went wrong.

However in their defense can I say one thing?

Why is it that anti-"M$" fans say "THEY SHOULD ADMIT THAT THEIR SYSTEMS ARE FAULTY AND FIX PEOPLE'S XBOX'S!!!!!" And now that they have ADMITTED to the problem, and are GOING TO DO SOMETHING about it, you still yell at them, even though they are doing the only thing they can do from a business standpoint. They are admitting guilt, extending warranties and probably secretly changing components like with the 65 nm processor and the new cooling heatsinks that they are putting into over heated xbox's, and all you can do is still yell for when they are trying to make amends. Maybe they could have said it better but I think they are for the most part doing what they can do for the customer, and thats something that should never be looked at negatively from any standpoint. When my sony products broke, at least 2 times I felt that sony was trying to help me out even though they disappointed me, I know they did what they could as well as they could, so try looking at it with a more accepting view eh?

[Adopted]

and this is probaly why my beaner cousin is richer then billie boy LOL

[Scorpion3]

Geez, looks official now. I'm sure there are some guys screaming at some others in a microsoft corporate head meeting or room asking what the h*** went wrong.

However in their defense can I say one thing?

Why is it that anti-"M$" fans say "THEY SHOULD ADMIT THAT THEIR SYSTEMS ARE FAULTY AND FIX PEOPLE'S XBOX'S!!!!!" And now that they have ADMITTED to the problem, and are GOING TO DO SOMETHING about it, you still yell at them, even though they are doing the only thing they can do from a business standpoint. They are admitting guilt, extending warranties and probably secretly changing components like with the 65 nm processor and the new cooling heatsinks that they are putting into over heated xbox's, and all you can do is still yell for when they are trying to make amends. Maybe they could have said it better but I think they are for the most part doing what they can do for the customer, and thats something that should never be looked at negatively from any standpoint. When my sony products broke, at least 2 times I felt that sony was trying to help me out even though they disappointed me, I know they did what they could as well as they could, so try looking at it with a more accepting view eh?

Because it's not necissarily the problems, it's them just looking for anything to say something bad about MS. My guess is because they don't have as much good things to compare the PS3 to 360 with like they did with the PS2 vs Xbox thing. As for your thoughts, you're right. They put a new cooling system in the broken 360's before sending them back, wouldn't doubt it if they started putting them in the 360s in production soon. By September I think it was, they'll be using the 65nm Processors in all 360s.

[{{909}}]

That's true.. and better than that they can say they have sell 11 millions units...:rolleyes: hmmm...


they are probably glad they didnt sell more, repairing 30 - 45% of 10 million is cheaper than 30 - 45% of 20 million.

So bill, remind us when the xbox project becomes profitable again, early 2008 wasnt it?...im sure your share holders are doing backflips of joy :)

[weetz]

Do you get an achievement if you get the 3RLOD...

[sigma8]

However in their defense can I say one thing?

Why is it that anti-"M$" fans say "THEY SHOULD ADMIT THAT THEIR SYSTEMS ARE FAULTY AND FIX PEOPLE'S XBOX'S!!!!!" And now that they have ADMITTED to the problem, and are GOING TO DO SOMETHING about it, you still yell at them, even though they are doing the only thing they can do from a business standpoint.
First of all, nobody has really "yelled" at them again yet, at least not in this thread. So, you are jumping the gun. Secondly, sure, they admitted something. They admitted there is an unacceptable number of repairs, and that there are certain factors that may cause them. They still have not admitted that they have design flaws in the system. As you may be aware, their company line is absolute denial that there is anything wrong with Xbox360's, and failures are due to human error and/or unlucky circumstance. They've basically had a policy of saying "it's your fault, but we'll fix it because we R AWSUM".

Personally, I thought it was refreshing to read that they're finally acknowledging something. But it's a little depressing that it wasn't all the annoyed customers that forced them to acknowledge it, it was the inevitability of that $1billion repair cost that they couldn't figure out how to hide from investors.

You can defend MS all you want, but judging from how they've behaved, I wouldn't count on MS to defend you.

Because it's not necissarily the problems, it's them just looking for anything to say something bad about MS. My guess is because they don't have as much good things to compare the PS3 to 360 with like they did with the PS2 vs Xbox thing.
#1. There are enough problems. You really don't need to spend any time "looking" for something to criticize them for.
#2. You like to guess a lot, don't you. Nothing beats facts like random guesses!

[Covert Knight]

Do you get an achievement if you get the 3RLOD...

OMG THATS SO FUNNY LAWL I MEAN REALLY WHO THOUGHT OF THAT, GENIUS! GENIUS!!! I MEAN THAT WAS TEH SMARTEST THING EVER SAID AND ORGINAL TOO!!!! :rolleyes: A stupid non creative thought that has only been said 5,000 times by anti-"M$" flamers. So when did Kaz let you off your leash to come roam here?

Look I don't mind people using constructive criticism when analyzing the 3 major consoles, but its crap like that, which gets all sides nowhere.

Thats what I meant, those guys, so yes I pre-emptively struck but /shrug it still happened. :p

[So-Unreal]

This is the Gaming Story of the Year.

[Cobra.uK]

All I can say is finally, about time they acknowledged the problem and made it public that they know the problem is there, and now they've done something about it!

[mystic54]

Everybody knew they were going to have to make some sacrifices to get a good stake in the gaming market, but 1 billion? I guess better late than never.

[Scorpion3]

You can defend MS all you want, but judging from how they've behaved, I wouldn't count on MS to defend you.


#1. There are enough problems. You really don't need to spend any time "looking" for something to criticize them for.
#2. You like to guess a lot, don't you. Nothing beats facts like random guesses!

I don't think the first part was about me, but no big name company would defend you, not Sony, Not Microsoft, and probably not even Nintendo. All you are to them is a statistic.

And as far as the things aimed at me, it was pure sarcasm.

[sabata dark]

OMG THATS SO FUNNY LAWL I MEAN REALLY WHO THOUGHT OF THAT, GENIUS! GENIUS!!! I MEAN THAT WAS TEH SMARTEST THING EVER SAID AND ORGINAL TOO!!!! :rolleyes: A stupid non creative thought that has only been said 5,000 times by anti-"M$" flamers. So when did Kaz let you off your leash to come roam here?

Look I don't mind people using constructive criticism when analyzing the 3 major consoles, but its crap like that, which gets all sides nowhere.

Thats what I meant, those guys, so yes I pre-emptively struck but /shrug it still happened. :p

how can he be anti ms.....he has a gamercard...........

[Nemo29]

haha my mates broke the other week he sent it to be repaired by a private company, cost him 50+ pounds and hes probably voided the remaining 1 year or so left of his warranty!

[wigsplitta]

This is a great opportunity for everyone to nab broken 360s with the ring of death from EBay for next to nothing. Once you get it call MS and get the free repair. VOILA cheap 360

[Tempos]

I'm not sure that would work. You probably still need to have been covered under warranty at some point and only the original owner is covered under warranty. If anything, this will increase sales and stop second hand sales.

[toye]

I'm not sure that would work. You probably still need to have been covered under warranty at some point and only the original owner is covered under warranty. If anything, this will increase sales and stop second hand sales.

I don't know about US. In Sweden the warranty follows the product and not the consumer, so how many owners and who originally bought it doesn't matter. Only the receipt and the fact that it is still under warranty should apply.

[sigma8]

I don't think the first part was about me, but no big name company would defend you, not Sony, Not Microsoft, and probably not even Nintendo. All you are to them is a statistic.
Every company is different. They all need to be profitable to survive, and more profits = more growth. However, some are more customer-centric than others, whether its due to a relatively benevolent management team, or just shared common interest (e.g. ISP's protecting customers against the RIAA is good for ISP's, because caving to the RIAA's demands would be costly for the ISPs).

My point was that MS has been telling customers they are outright wrong for many months, giving no ground until now--which coincidentally was at the same time they addressed costs to investors.

Take Ubisoft. Ubisoft actually apologized for releasing crappy Wii games. I am not sure if that was timed alongside an investor report. There are certainly many other companies that have released crappy games and never apologized. I'd call that gutsy and customer-centric.

Either that, or a trick to get us to buy their next crappy game.

And as far as the things aimed at me, it was pure sarcasm.Oh well I was sarcastic too, then.

[Xenogears V]

Microsoft should close down if it had to also mend those that don't reenter in warrnaty, cause hacked firmware.:rolleyes:

[KainXS]

looks like the 360 is the new windows millenium

[Scorpion3]

Every company is different. They all need to be profitable to survive, and more profits = more growth. However, some are more customer-centric than others, whether its due to a relatively benevolent management team, or just shared common interest (e.g. ISP's protecting customers against the RIAA is good for ISP's, because caving to the RIAA's demands would be costly for the ISPs).

My point was that MS has been telling customers they are outright wrong for many months, giving no ground until now--which coincidentally was at the same time they addressed costs to investors.

Take Ubisoft. Ubisoft actually apologized for releasing crappy Wii games. I am not sure if that was timed alongside an investor report. There are certainly many other companies that have released crappy games and never apologized. I'd call that gutsy and customer-centric.

Either that, or a trick to get us to buy their next crappy game.

Oh well I was sarcastic too, then.

See, that's where you're wrong among others who claim Microsoft just played dumb for months, when I sent in my 360, they told me that Microsoft was having problems with their consoles and were trying to work it out, In January 2005 they admitted they were having problems with consoles but thought it was only isolated, saying they would fix any console from that manufacturer if it broke. Last November when they issued the 1 year warranty kind of proves they weren't hiding the fact that they had issues with it. And then they finally got a fix, and now have a 3 year warranty on the 360 so I doubt that they were hiding it like some of you are trying to make it out. Too many people try to make Microsoft look like some deviants when they in reality caught by surprise on how bad the 360s were manufactured and have tried to keep the people happy by fixing 360s for free and now they're doing that as well as providing a fix.

[KainXS]

See, that's where you're wrong among others who claim Microsoft just played dumb for months, when I sent in my 360, they told me that Microsoft was having problems with their consoles and were trying to work it out, In January 2005 they admitted they were having problems with consoles but thought it was only isolated, saying they would fix any console from that manufacturer if it broke. Last November when they issued the 1 year warranty kind of proves they weren't hiding the fact that they had issues with it. And then they finally got a fix, and now have a 3 year warranty on the 360 so I doubt that they were hiding it like some of you are trying to make it out. Too many people try to make Microsoft look like some deviants when they in reality caught by surprise on how bad the 360s were manufactured and have tried to keep the people happy by fixing 360s for free and now they're doing that as well as providing a fix.


if they told you it was isolated then that was an obvious lie as we know that at least million are defective and that means that they ARE still trying to hide just like they are trying to hide the forza rlod's

i though the ps2's laser was fucked up but god damn 2 million in under one year GOD DAMN

[Scorpion3]

if they told you it was isolated then that was an obvious lie as we know that at least million are defective and that means that they ARE still trying to hide just like they are trying to hide the forza rlod's

i though the ps2's laser was fucked up but god damn 2 million in under one year GOD DAMN

Back in January 2005 they wouldn't have known any better, seeing as it was 3 months after release. So calling it a lie, not so sure about that. And you are paranoid, they said themselves they only MOVED the thread so that they could study it. Not saying that I believe that, because that could be naive, just as believing they shut it down so to not look bad would be.

And don't you mean under 2 years? PS3 has roughly 36,100 consoles broken in 7 months so in by the time it's into it's 19'th month it'll have nearly 100 Thousand (97,985 roughly) broken. True, a far cry from 2.5 million but with it only selling about 20,000 consoles a month, 5 Thousand of them are breaking. That's pretty high for a flawless console, compared to the 360, which Microsoft has admitted problems.

[KainXS]

yah i meant 2 years but this damn laptop keyboard sucks