Microsoft knew about 360 issues before launch

[BreakmanX]

Ok, so its lame that the console breaks. How much lamer does it make it that they knew before it was released? Premeditated, if you will.

MS Knew About 360 Defects Before Launch
Investigative report says the "RROD" defect kept Microsoft from originally planned price cuts.
By Kris Pigna, 09/07/2008
Call us crazy, but we suspect most Xbox 360 owners are, by now, well familiar with the dreaded Red Ring of Death -- maybe you haven't suffered through it 11 times, but odds are you or someone you know has likely dealt with Microsoft customer support at some point in the last three years. Now, a new report by VentureBeat's Dean Takahashi (author of the behind-the-scenes books Opening the Xbox and The Xbox 360 Uncloaked) contends that Microsoft knew about the issue before the 360's launch but refused to delay the release in order to beat their competitors to the market. And that decision, the report claims, has kept Microsoft from marketing and pricing the 360 as aggressively as they would have liked to.
The report (which Takahashi calls "unauthorized" but assures is well researched and several years in the making) paints an overall picture of Microsoft rushing through the Xbox 360's initial design and manufacturing, without heeding warning signs that the hardware was suffering from potentially serious defects. "It turned out, in the end, that this was all going too far, too fast," says one anonymous source about the 360's design process. "They were adding too many features after things were locked down. That incremental feature adding just made it fragile." The report claims (although Microsoft refused to confirm these figures) that as Microsoft went into full production in August of 2005, they had a staggeringly high 68 percent defect rate -- that is, for every 100 Xbox 360s they manufactured, 68 were duds.

But the more interesting point raised in the report is that Microsoft's gamble to continue toward launch (expecting the hardware issues would quickly work themselves out over time) has apparently kept them from pricing the Xbox 360 where they originally wanted it to be at this point in its lifecycle. "The quality problem negated much of the advantage of going first, and it has delayed the company's plan to aggressively market the console and slash its prices," Takahashi writes. "That has stopped the company from reaching the broader market of consumers that Nintendo has won over. It has lowered its ambitions, hoping instead just to get a clear edge on third-placed Sony. The future profits that the company once hoped for are now likely to wind up in Nintendo's pockets."

But Robbie Bach, president of Microsoft's Entertainment and Devices division, maintains that being first to market was the right decision. "If you take the question of whether it was the right thing to try to be first, the answer to that is definitely yes," Bach says in the report. "It has given us a leg up in a number of places that are super important. It has given us a leg up with game developers. It has given us a leg up from an economics perspective. It helped us expand Xbox Live quickly. At a strategy level, if you asked if we wanted to be first again, I would say yes. It's easy for me to go back and say, if I knew what would transpire over the next two years, would I go back and do something different, I think that's an obvious answer. But the fact is, based on the data we had at the time and all the hard work we put into it, there was no way to see what actually happened."

It's an interesting statement, in that Bach is saying they made the right decision, and yet he also admits they would've done things differently knowing what they know now. And what Microsoft knows now is that whatever intangible gains the defects may have cost them in keeping them from cutting their prices more aggressively, the defects did cost them a very tangible $1.15 billion dollars as a result of extending warranties for the RROD problem in July 2007. "Would I like the billion dollars back? Of course, the answer is yes. But there is still plenty of economics in the business for us to be successful," Bach says.

But with all models of the Xbox 360 just this week receiving a new wave of price cuts (putting the Arcade unit $50 cheaper than the Wii), it's fascinating to consider Microsoft may have actually intended for their hardware to be even cheaper at this point in the lifecycle. Could that have drastically changed the current standing in the so-called console wars? It's impossible to know for sure, but it sure is a fun "what-if" to ponder.

[JerRyu]

I'm sure most of us kinda thought that anyways. That MS crossed their fingers and shoveled them out into the market knowing that they are that bad, but holy smokes 68% defect rate!? ... Yep, I guess that sounds about right!
JerRyu

[WiizerFanboy]

Makes you wonder WHAT IF the wii and ps3 came out first.

[Stormeagle]

http://videogames.yahoo.com/feature/did ... s-/1245120
Heys the some thing on yahoo But it said "in February, warranty company SquareTrade pegged the console's failure rate at a shocking 16%. But a stunning new expose claims that Microsoft knew over two-thirds of the consoles produced by its contracted factories in the run-up to the Xbox 360's November 2005 launch date were faulty, and opted to push the machine out to consumers in spite of its problems"
hmm 16% to over two-thirds = The BreakmanX 100% Faulty 360.

[Verence]

Have they fixed them yet? I mean, are the new ones being made still as crappy?

'Cause mine is crapping out, and I don't want to buy YET ANOTHER one if they haven't fixed all the problems yet.

[Stormeagle]

Have they fixed them yet? I mean, are the new ones being made still as crappy?

'Cause mine is crapping out, and I don't want to buy YET ANOTHER one if they haven't fixed all the problems yet.

Yup it's ture the new Xbox-Red-ring-of-Doom360 still have the some Problems My buddy At work Did have a L33T 360 but it Red-Ring on him last night he was not Happy PLus the best part was that he had it for about 2-3 mouths.
P.S W00T 300 post

[Verence]

Jesus, Microsoft really hates its customers.

[Cable]

My roomates 360 died this week too. No more rock band and oblivion where mouths dont freek out when people talk.

That makes 3 out of 3 360s that have crossed the threashold of my house that have broken there. All had different owners though and were replaced with i belive still working units.

Wich reminds me, my roomate got his Xbox about a year to a year and a half ago. His no longer girlfriend bought it for him and he dosn't have the reciept.

Do you gents know if microsoft has a return policy that will help him? or is he boned?

[RurouniQ]

They'll still help. The serial number indicates when the machine was manufactured, and they'll determine his eligibility for service off of that information.

[jayt11]

they can get my eligibility's sac. Microsoft just lost a fan in me. Very poor business....they must be Republican..

[Mericks]

they must be Republican..

[jayt11]

i apologize, i wrote that at like 4am...i was pissed that i couldn't get any sleep......

oh, who am i kidding, F!!!! Palin....hmm.....

[Mericks]

More applause

[JerRyu]

LOL, Oh crap I just turned in my third DEAD 360! into Bestbuy!

Usually I never buy extended warranties (blah blah blah, I've mentioned this countless times before) anyways, got me a new Elite 360 (straight exchange) so i guess it's okay. What sucks is I lose all of my achievements and saves.

So, I'm officially on my FOURTH 360!

[jayt11]

screw that! I bought a PS3 for 270 on Ebay.