Now would be the time to buy a 360

[Rdaug27]

Microsoft to expand warrant to 3 years. Will cost them a billion dollars.

http://videogames.yahoo.com/news-521686

[Deslock]

Who'da thunk it?

SEATTLE - Microsoft Corp. won't say what went wrong inside of its Xbox 360 video game consoles that could lead to $1 billion in repairs, but bloggers and their online readers seem to have their own answer: Heat stroke.

Frustrated Xbox 360 gamers have been going to blogs and forums to swap horror stories and voodoo-like solutions for problems with the consoles, which first went on sale in November 2005.

Microsoft has called the seizures "general hardware failures," while some users have referred to a "red ring of death," for the three lights that illuminate on the console when a serious problem has occurred. Many have raised the possibility that something — either the power cord, or a component inside the box — is overheating and breaking in the units.

A thread on the GameSpot.com forums from 2005 recommended suspending power cords with string in midair to keep them cool.

In June 2006, a post on the blog Xbox-scene.com pointed enthusiasts to a way to cool the console by piping tap water through hoses that snaked through the machine's innards. Another Xbox-scene.com entry from June of this year purports to show photos of a Microsoft-repaired console with added hardware to trap heat.

YouTube videos, both deadly serious and snarky spoofs, abound.

"People have had some crazy ways of trying to fix their consoles when this happens," said Dustin Burg, a full-time blogger for Weblogs Inc.'s Xbox360fanboy.com. He described the "towel trick," which is believed to cause overheated components inside the console to heat up even more, thus melting everything back into place.

Burg, 21, is on his third Xbox 360. He and a handful of friends won consoles from Microsoft as part of a promotional push around the time the system launched in late 2005. All five consoles have since succumbed to general hardware failure and had to be returned, he said.

Burg said the three flashing red lights that indicate the problem started appearing on his console after about 10 months. He was able to get it working again for a while by shutting the machine on and off, but eventually it just stopped working.

"It's almost like slow dying," he said.

Burg skipped the towel trick and sent the console back to Microsoft, which swiftly replaced it.

The Xbox 360 Fan Boy blog attracts a great deal of attention from gamers. When the site reported Thursday's news that Microsoft will extend the warranty for the Xbox 360 to three years_ from one year in the U.S. and two in Europe — more than 60 people wrote in with comments. But Burg said no one out there really knows what's causing the machines to flatline.

"It could be a lot of components," he said.

Microsoft, for its part, is giving few insights. Robbie Bach, president of the unprofitable entertainment and devices division responsible for the game console, said the company has made manufacturing and production changes that should reduce hardware lockups.

Microsoft declined to comment on whether overheating was causing any of the problems.

In 2005, Microsoft recalled the original Xbox's power cords, saying they posed a fire hazard in some cases. The software maker did not specifically say whether the Xbox 360's power cord is related to current hardware failures, but David Dennis, a Microsoft spokesman, said in an e-mail that the fixes were made to the console.

The software maker also declined to spell out how many machines have been afflicted by the problems, but said that the number of returns reached critical mass in the past few months.

Chris Szarek, a photographer who lives in Chicopee, Mass., doesn't buy that Microsoft is just discovering the problem. He complained about it last year, complete with Web postings and faxes to Microsoft Chairman Bill Gates and other top executives.

Szarek, 38, has sent three consoles back to Microsoft, two that signaled general hardware failure after just a few months and one because it would not connect to the Internet.

He said he doesn't know what's going wrong, though he, too, has heard about overheating. He said he was offended that Microsoft customer service told him there might be something wrong with the wiring in his house.

Szarek said that whatever it is, he expects the problem to afflict his fourth console, too.

"I haven't had any 'three red lights,' but I'm fully expecting it," he said. "It's not a matter of if it's going to happen, it's a matter of when."

Many gamers responded with blog posts and comments praising Microsoft for extending the warranty. Wall Street was also forgiving, even though the software maker said it will record a charge of up to $1.15 billion for its fourth fiscal quarter, which ended June 30, to cover the additional costs associated with the warranty extension. Shares of Microsoft dipped 2 cents to close at $29.97.

Analysts were disappointed that Microsoft would take a financial hit in the June quarter, but were overall unworried by the news.

"By expanding the warranty coverage it could gain more traction in the gaming community and regain some momentum with its console sales," wrote Credit Suisse analyst Jason Maynard in a note to investors Friday. With a one-year head start, Microsoft has sold more consoles since launch than competitors Nintendo and Sony. But in May, Nintendo's Wii outsold the Xbox 360, according to data from market researchers NPD Group, while Sony's Playstation 3 sits firmly in third place.

SEATTLE - In another setback for Microsoft Corp.'s unprofitable entertainment and devices division, the company says it is planning to spend at least $1 billion to repair serious problems with its Xbox 360 video game console.



Microsoft declined to detail the problems that have caused an onslaught of "general hardware failures" in recent months but said Thursday it will extend the warranty on the consoles to three years.

The glitches, and the bad publicity, could weigh the company down as it claws for market share in the highly competitive console market. In May, the Xbox 360 ranked No. 2 in unit sales behind Nintendo's Wii, but still beat out Sony's Playstation 3, according to data from NPD Group.

"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, a distant competitor to Apple Inc.'s powerhouse iPod. "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 its fourth fiscal quarter, which ended June 30, to cover the additional costs associated with the warranty extension.

The news comes just days before the video game industry descends on Santa Monica, Calif., for its annual E3 conference, and it could overshadow Microsoft's plans to build buzz for holiday season video game releases and "Halo 3," a much-anticipated shoot-'em-up for the Xbox 360 set to launch in September.

The software maker also said Thursday that sales of the game console fell short of expectations for the fiscal year that just ended.

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."

This isn't the first time Microsoft has made changes to the Xbox 360 repair plan. Last December, the company extended the warranty from 90 days to one year for U.S. customers. In Europe, the warranty previously expired after two years.

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.

Chris Liddell, Microsoft's chief financial officer, said in a conference call that the company sold 11.6 million Xbox 360 consoles since the product's November 2005 launch, missing a target for 12 million units by the end of the fiscal year.

Xbox 360 prices range from $299 to $479, depending on their configuration.

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. Microsoft has said it expects the division to post a profit in fiscal 2008.

Microsoft announced the warranty extension after markets closed Thursday. Microsoft shares fell 11 cents to $29.88 in extended trading after falling 3 cents to $29.99 in the regular session.


Guys, no offense, but no thanks....

I hope Microsoft can pull their heads out of their collective behinds and fix these terrible problems for you all. :)

[norm]

duplicate thread..lol

[Zabka]

a three year warranty means that I have nothing to worry about for a good long time. I now don't care if it goes down. By the way, Des, in my prior post about this, MSFT acknowledged that they do have fixes (re: cooler chips). But regardless, I have never seen a company step up in a case like this to offer a warranty of this nature when many would have thought 12 months was perfectly fair. Now my only complaint about the 360 is a non-issue.

[RaTix]

I dare you to name one console that was never plagued with problems (well besides the old Atari's. You could beat the **** out of those things)

NES - who here didn't have to develope some odd trick of positioning the game cart in the drive just right or crunching it into place to get to work after awhile

(Genesis and Super NES, Again cart troubles would eventually occur

PS1 - bouncing zenith screens anyone? or how about bad laser heads.

PS2 - I have gone through 4 myself

XBOX360 - Besides my ban for modding, no complaints and no problems.

PS3 - too soon to tell, but there are some deffinate programming flaws that should be updated.

The average lifespan of a console is 4 years. So to have 3 of those covered for free isn't a bad deal. Every console is gonna have its run of problems. So it's good to know the company is gonna be there and correct and support those problems.

[Rdaug27]

I just thought this was a huge warranty. I don't know of anything you buy that has a longer manufacturers warranty. (except maybe a car) I just bought a hard drive, one year, hell I think the washing machine I just bought only came with a one year. Yeah if you buy it from some places you can buy an extended warranty, but this is right out the box not paying more for it. What about some of these plasma and LCD TV's, how much warranty do they get? How long is a PS3 warranty for? ........I will wait for the argument that its a "better" system and doesn't need a long warranty ............I guess I should have named the thread something else, I didn't mean for this fight to come up again lol. I really don't plan on getting a 360 myself, I just posted this cause I felt its a big announcement.

[Kerry2]

You know there are alot of pissed off Best Buy and Circuit City customers right now. So much for the $50 3 year extended service plan.

[Zabka]

Except many of those people have already used it because the failure rate has been so high! But the good thing about those warranties is you walk right in, and they give you a new one. No waiting for a box and mailing it off.

[CHRIST]

The only problem I have had with my PS2 is that it takes a few minutes to read DVDs.

[Deslock]

I guess I should have named the thread something else, I didn't mean for this fight to come up again

No, no one's fighting, I just read the gaming news and thought that a 1 billion write off was one helluva expense. You guys deserve more for your more than well earned money, and they won't even say what's wrong.

[norm]

man I can't tell you how touchy some of those NES games were..lol

RDaug, buy a Seagate drive. 3 to 5 year warranty!

I have to admit based on M$'s past in dealing when something breaks this is a huge step up for them. I still say they are doing right with their gaming division with listening more to their customer when compared to their other divisions. Sony was really good at listening to customers when they had issues with the PS1 and PS2, but it seems with the PS3 they took their customers for granted. That when it came down to it turned me to M$.

[Deslock]

Microsoft's customer service, and the fact that they actually listen to their customers is beyond great. Sony needs to learn a great deal from Microsoft's record. I believe that this is because Bill Gates is a truly good man, that wasn't born rich, he earned it, and he didn't let his enormus wealth go to his head.

But they should've done more product testing beforehand, so they wouldn't have to take a one BILLION dollar write of on their profit base, and anger and dissapoint so many customers.

[Kerry2]

Two consoles down ????? more to go.

[Kamui]

My PS2 doesn't like reading Blue disks and some PS1 disks :(.....
Yea I remember that nintendo problem.Had to put some games in the freezer because the system was rather picky.

[TriPP]

microsoft had to do this, the 360 is a defective product (the continued failure rate is too high). microsoft knows this, so they decided to gain some positive publicity and good will by extending the warranty, instead of getting arse raped in court.