360's warranty extended, PS3 price drops

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360's warranty extended, PS3 price drops

Post by Keavy »

First, the Xbox 360 now has a three-year warranty that's retroactive.

http://www.1up.com/do/newsStory?cId=3160818
1up.com wrote: Microsoft made many gamers happy this morning by deciding to universally enhance the Xbox 360 warranty program. Though the warranty has changed in the past, today is the most far reaching shift. The new three year warranty policy applies to all machines, whether they were purchased today or at launch, and covers all costs associated with fixing the red ring issue that has plagued a great number of machines.

This is very clearly a big step for Microsoft in coming to terms with issues that reared their heads within the first few weeks of launch and have simply refused to go away. 1UP spoke with Peter Moore this afternoon about what this means for the Xbox platform going forward. Does this cover issues like disc scratching and dirty disc errors? Does Microsoft wish it had addressed this problem sooner? Why does Moore call this "tough day" at Microsoft for many people?

Read on and find out.

1UP: Not too long ago, in an interview with Mike Antonucci, you famously responded to question about the breaking 360s with "Ya know, things break." Do you regret saying that now?

Well, no, things do break, don't they? I think we just proved that. [audible pause] Hmm. I regret the way people took it, but my focus was, if you read the whole thing, people take that comment without context of that entire one and a half hour interview, but the focus is on customer service and stuff does break and we're clearly trying to rights some of the wrongs we've caused some of our consumers here over the past few months. Yeah, things break and we need to do a better job of fixing it, doing it quickly and not charging people for it.

1UP: Not too much later, Dean did another interview with Todd Holmdahl, your corporate VP of Gaming and Xbox Products Group. The quote everyone focused on there was gamers complaining are considered a "vocal minority." But, if they're a vocal minority, how does that result in such a far reaching change in warranty policy?

Well, it still is a minority of customers and clearly they're very vocal and they should be, because we haven't done right by them. Todd was right, it is a minority. The great majority of people are having a great time with their Xbox 360s -- you know that. We don't have 10 million broken Xbox 360s, but we haven't done a good job, in recent months in particular, of taking care of the people that have taken care of us, Patrick. We've made a pretty bold step today -- as you said, "ouch" -- that has some pretty far reaching consequences financially, but as a company think is the right thing to do, and we're going to take care of you whether you bought on one launch day or yesterday and protect you against those problems that are indicated by the three red rings on the console. I hope people focus on us doing the right thing, rather than whatever nefarious [tricks] they think we had up our sleeve.

1UP: The response has been positive so far. The response is that we're glad it happened, but why did it take so long?

It took so long because it's not an easy thing to do. It's a large financial hit, you make sure you do things right the first time and the only time and we don't come back two months later and do changes and take bigger financial hits and say we've got a different problem we never figured out -- things of that nature. So, you collect data. It's global, we're in 38, 40 countries selling this thing -- not just the US -- and we need to make sure we have global policies. We need to roll it out to all our customer service call centers around the globe, [and make sure] repair and refurbished centers are gonna be ready to accept whatever comes in. You can't do it overnight, Patrick, and hope people realize it's a large step we're taking, but with the consumers well being at the forefront of that decision.

1UP: What has it been about the last couple of months that's preempted this change?

It's the data, it's the ability to finally collect data to pinpoint where the problems are coming from. I don't know if you listened to Robbie's call, the financial call, he points out that a lot of these problems are problems that occur after field testing and field use. We've only been in market since November 2005 -- that's 18 months or so -- the ability for us to get a real handle on it, you want to make sure you only do this once, make sure you've captured all of the issues, make sure you've made all the right financial reserves to be able to take care of everybody on a global basis and it takes a little time. It's not something we thought about on Monday.

1UP: But this isn't the first time Microsoft has changed the warranty policy. What's different this time?

This is just focusing on what we now have the data to do and make sure we're taking care of people. You never say never, but the ability is for us to look at the data we have captured and put a cost number against it and our goal is to take care of you.

1UP: Was there a tipping point? In the last couple of weeks in particular, there's that Micro Mart company, that I realize isn't an official Microsoft repair center, but is this a response to that? Even 1UP ran our story about a guy...

Right.

1UP: ...who was treated very well, but the point of the story was that it was still 11 [broken 360s]. On its face, it seems like a response to all that chatter.

No, no, this is data. Believe me, this is not something we figured we needed to do this week or last week. This is something a lot of people have been working on it, a lot of people have been examining the data and it's very important you do this properly and you capture all the costs. Because some poor guy, and I, of course, read the story and felt very bad, had multiple consoles go out, but that wasn't the tipping point that made us do this. This is the collection of numerous points of data on a global basis and bringing all that together and making sure we did the right thing.

1UP: In your open letter, you said that "certain improvements" have been made to the console. Can you elaborate on that?

Not really, I'm not the technical guy. As has always happened in our business, you're constantly improving your console as you learn things about what goes right and what goes wrong in the field. In our case, over 10 million now in people's hands, you get data, you get feedback, and you're constantly improving both to increase its reliability and bring costs out of the console, so eventually you can pass down some cost savings to the consumer. I'm not the technical guy and I can't comment on that.

1UP: If the improvements have been made, does that mean the new ones being rolled out...this is typically affecting launch machines, does that mean the new consoles on shelves have these changes?

I can't speak in the 40 countries in what could be hundreds of thousands of retailers, whether they...

1UP: Let's talk about just the US, then.

Sure, don't know. Here's what you should worry about: if you get one today and you have a problem tonight or you have a problem two and a half years from now, we're gonna take care of you. I can't speak of every console on the United States' shelves.

1UP: But, eventually, by year end?

The eventuality is that every day, as we're making consoles, we're learning more about them, we're improving it, as I'm sure Sony and Nintendo are doing.

1UP: The cynical response to this is, does this insinuate Microsoft expects the systems to fail, so they're covering themselves?

No, no. I mean, you have to cover yourself, we're not expecting things to fail, but, again, from a financial point of view, you have to look at scenarios and say we need to make sure we're taking care of customers should things happen and that has a cost to it. We're trying to do the right thing. Cynics will try and poke holes in this, I understand that, that's their prerogative. It's a tough day here in Redmond for a lot of people, and people should be aware of that, but it's been tougher for a lot of people who've had problems with the box and we need to take care of them.

1UP: Tough in what way? Financially, or needing to "man up" to take care of this problem?

No, tough from a moral point of view, tough financially, of course. We've got a lot of very passionate people up here, you know many of them, Patrick, people who work on this thing. It's not easy to reads the headlines. I take that very seriously, but at the same time, the feedback I'm getting from my open letter is that I'm glad we're doing the right thing for people, as difficult as it is to read about this stuff.

We don't have 10 million broken Xbox 360s, but we haven't done a good job of taking care of the people that have taken care of us
1UP: For the longest time, as media outlets have been chasing this story, it's felt like the idea was being dismissed or danced around and now it's responding well because people are happy something's being said.

Right. And that's fine. And I want to apologize for anybody, no matter where they are in the world, that has had this problem and we haven't done right by them. We're gonna do right by them.

1UP: I want to be specific. This only covers the red ring issue.

That's correct.

1UP: Personally, last week, the issue I ran into was my machine stopped playing some discs, but will play some others. This won't be covered under that, correct?

It's the red ring, which is a general hardware failure. You've got a one-year warranty, depending on when you got your box...

1UP: Mine was a launch one.

This is focused on a specific issue that we feel we haven't done a great job working with the consumer and that's what the focus is, yes.

1UP: The people who already purchased an extended warranty, what does this mean for them?

I don't know about that. A lot of the extended warranties are retailer-oriented, so our point of view is that if you bought a box, you have a three year warranty effective today. We need to be able to take care of people who have paid us for repairs that have been out of warranty against this problem, so we're going to busily start sending checks out to those people again.

1UP: Now that these are being fixed in the original machines, are we going to see a tweaked box? There's a lot of talk of switching to a 65nm chip. Is this indicative of a change?

We'll fix problems, we'll improve the box. Clearly, we don't intend this to be a go-forward for the entire life cycle situation, we're constantly improving the box both from a quality point of view and a cost point of view, and that's important at both levels, and obviously we expect our quality to improve. In the short term, we have done a good job with a set of consumers that have the three flashing red light program and we're doing that immediately.

1UP: Do you anticipate this affecting the gaming division achieving profitability in the next fiscal year?

No. We're very focused on delivering profitability in fiscal 08 and we will deliver profitability.

1UP: Were retailers notified beforehand about this policy change?

For the great majority of people, because of the FCC requirements of not giving people heads up because of insider trading rules, the great majority of folks...now, of course, we have called all our retailers and all of our 3rd party partners this afternoon, we've had a roll out of how we've imparted this information for people we care about. The fact that I'm speaking to you, I've spoken with a number of people and will continue to speak to people throughout the afternoon, answering their questions. The impact on those folks, I don't know, but they're simply going to have to be understand what needs to be done like the rest of us here.
Second, the PS3 will be $499 in about a week.

http://kotaku.com/gaming/truth/retailer ... 275456.php
Kotaku wrote: Following up on the report that the PLAYSTATION 3 would see a $100 price cut taking place the week after E3 2007, GameDaily has confirmed with "a merchandising manager at one of the world's biggest retailers" that the 60 GB version of the PS3 will indeed drop to $499, starting on July 12, one day after Sony's E3 press conference. GameDaily also reports that the new price is indeed indicative a retail-wide price drop, not a Circuit City specific sale, as a handful of speculators have posited.
Feel free to discuss how these two revelations have forever changed your lives.
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Post by Sugami »

Haven't changed my life at all :P What was the old price of PS3? And what's the current 360 price?

That works out to be roughly £250 but I know it'll be more expensive over here so expecting £280-300 (about price of a 360).
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Post by Kahvi »

Sugami wrote:Haven't changed my life at all :P What was the old price of PS3? And what's the current 360 price?

That works out to be roughly £250 but I know it'll be more expensive over here so expecting £280-300 (about price of a 360).
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I dunno the H4xb0x 360 price tho...
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Post by Alya Mizar (Tsybil) »

Not a platform gamer so it affects me not at all.

But I follow news about lots of things and this seems to be one.

It isn't just in the gaming press.

http://www.msnbc.msn.com/id/19620158/
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Post by Tivia »

This is MS attempting to dodge a lawsuit, apparently the quality of the 360's is well outside industry standards.

Sony say's otherwise about the price drop however.
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Post by Keavy »

I do believe the extended warranty is MS's way of avoiding a lawsuit and trying their best to make nice.

They f***ed up. They rushed the 360 to the market, rushed them through the production line to meet demand, and they used cheap parts where they could to save money and now its biting them in the ass. Same thing happened with Sony but it took a class-action lawsuit to get them to do right by their consumers.

Much like how the PS3 is rock solid and had a staggered launch expect the same for the next Xbox. MS learned a costly lesson but it won't hurt their marketshare that much because just like with the PS2 they have the time lead and they have the developers.

As for the price drop, I think Sony's pissed that it got leaked. Like with Home, this was going to be their big announcement for E3 and again, like with Home they're trying to backpedal on it.

From what I've read over at some of the larger gaming sites (NeoGAF, 1up, GameFAQ's) there will be a lot of animosity towards Sony if they don't drop the price. The $499 price point seemed to be the one that everyone wanted for the PS3. Hell, I would have gladly bought the 20GB model when I had the money if I could have found one.
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Post by Kintrra »

As to the 360, I still don't own one, so doesn't affect me. ^^;;

As to the PS3, I might pay up to $400 for a brand-new console...but I'm not paying FAR more than that for a damned media center. <_<;
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Post by Pheonixhawk »

I own a 360, but am currently selling it to my roomate (heh heh heh). it works fine seeing as I never really used my 360. I think I may not deal with platform games anymore. Maybe it's just me, but as of late, ive been seeing crappy titles for games.
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Post by Sugami »

Just had a sneak peak at EB, A 360 Pro costs $399 so it'd still be $100 cheaper than the PS3 after the price drop.
From what I've read over at some of the larger gaming sites (NeoGAF, 1up, GameFAQ's) there will be a lot of animosity towards Sony if they don't drop the price.
You mean there isn't already animosity towards Sony? :lol: :P
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Post by ScarlettPheonix »

Its no worse than the animosty towards Microsoft lately.
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Post by Sugami »

But people have been hating Microsoft since Windows first came hate :P
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Post by Alya Mizar (Tsybil) »

Keavy wrote:They f***ed up. They rushed the 360 to the market, rushed them through the production line to meet demand, and they used cheap parts where they could to save money and now its biting them in the ass.
Nope, they used standard MS marketing decisions to get market share. Biting them in the WHAT?? Not a dent in the pocketbook. Remember that ALL platforms are loss leaders. This one just became a little bit bigger a loss. Anyone want to figgure out Microsoft's cost bassis / unit on this one?
Keavy wrote:it won't hurt their marketshare that much because just like with the PS2 they have the time lead and they have the developers.


This is the point.
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Post by Sugami »

The Wii actually makes profit for each unit sold though, must be a first in console history :P
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Post by Keavy »

Sugami wrote:The Wii actually makes profit for each unit sold though, must be a first in console history :P
For a console at launch? Hell yeah.

In honor of this revelation I have retired "Indestructible Chunk" as my avatar and replaced it with "Wii Girl."
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Post by Sugami »

"Sony Cuts PlayStation 3 Price, Aims to Double Sales"

Can't be too hard doubling sales, since so few have been sold in the first place. Zing! :lol:
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Post by Tivia »

U.S. consumers have purchased 1.38 million PlayStation 3s since it was introduced in November
Considering that does not include Japan, or Europe, or Aus, I hardly consider that a case of they have hardly sold any. Yes yes I know you are bitter at Sony and just plain hate them, but seriously the false doom and gloom is a bit misplaced.
In addition to a larger hard drive, the new PlayStation 3 model will also come with the racing game ``MotorStorm,'' Tretton said.
gdi, time to go buy another one. need a second blu-ray disc player anyhow. *wonder if they will be nice and offer us early adopters a free copy of MS :P*
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Post by Keavy »

Hearing the NPD numbers month after month was pretty sad. Even worse? The GBA has been outselling the PS3!

A handheld that came out six years ago that's probably no longer in production is outselling the newest PlayStation!
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Post by Sugami »

Yeash it's a joke, honestly :roll:

Anyways it's peanuts compared to Wii and 360 sales :P
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Post by Keavy »

Sugami wrote:Yeash it's a joke, honestly :roll:

Anyways it's peanuts compared to Wii and 360 sales :P
I made the same joke at 1up.com and they roasted me like a frankfurter on Independence day.
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Post by Tivia »

Microsoft is still really bad at making excuses..

http://gamepolitics.com/2007/07/08/surg ... lures-huh/
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Post by ScarlettPheonix »

I like one of the responses. :lol:
90 percent of them were plugged into surge protectors when they failed?

Well, maybe, but 100 percent of them were turned off when not in use. Clearly turning a 360 off is what causes the failure.

Quick, someone call Microsoft.
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Post by Tivia »

Just to share the love.

http://www.g4tv.com/e32007/blog/post/67 ... _CNBC.html

Someone at Sony PR should just be beating their head against a wall right now.
:lol:
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Post by Leane »

Tivia wrote:Just to share the love.

http://www.g4tv.com/e32007/blog/post...d_On_CNBC.html


Someone at Sony PR should just be beating their head against a wall right now.
:lol:
bad link, bad
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Post by Tivia »

Link fixed sorry.
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Post by Sugami »

Keavy wrote:I made the same joke at 1up.com and they roasted me like a frankfurter on Independence day.
:lol: @ Sony fanboys :P

Microsoft make excuses? I thought they just ignored the problem and hope it goes away :P

Speaking of surge protectors, couple of my friends got caught in a lightning storm a bit back, one had a surge protector and the other didn't. They both experienced a power surge but the one with the protector had his computer fried and the other's computer was fine :lol:
Needless to say the manufactuers of the surge protector reimbursed him for the new replacement parts :P

Buu, can't watch videos at work D:
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Post by Keavy »

Sugami wrote:
Keavy wrote:I made the same joke at 1up.com and they roasted me like a frankfurter on Independence day.
:lol: @ Sony fanboys :P

Microsoft make excuses? I thought they just ignored the problem and hope it goes away :P

Speaking of surge protectors, couple of my friends got caught in a lightning storm a bit back, one had a surge protector and the other didn't. They both experienced a power surge but the one with the protector had his computer fried and the other's computer was fine :lol:
Needless to say the manufactuers of the surge protector reimbursed him for the new replacement parts :P

Buu, can't watch videos at work D:
First: Yes, I know 1up.com is the home of the Sony Defense Force. I figured with the new board layout they'd be scattered and confused and I would be safe.

I was so wrong. But then again, the mods temp banned them for flaming and nothing happened to me so HAH! One mod even posted a link to the official PlayStation forums and told them to go there. :lol:

As for MS, they're taking this seriously this time apparently. Microsoft really wants to gain acceptance as a game developer, much like Sony has. So part of that is doing what Sonly learned how to do the hard way: Own up to your mistakes and fix the problems.

As for Surge protectors according to MS the power brick has one built-in so you're supposed to just plug it directly into the wall.

That video... :lol: :lol: :lol: Oh, man. Jack Tretton got grilled and responded with the typical marketing bull. "Ten year lifecycle" is apparently their mantra. Yeah, to get a ten-year lifecycle you need to sell PS3's to ensure that developers will keep the software coming for the next 9 years and four months, you pompous, overpaid ass.
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ScarlettPheonix
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Post by ScarlettPheonix »

lol- well according to some previous interviews I've seen with Sony- they want to see the PS3 have at least as long a lifespan as the PS1. The PS2 has had a pretty good run, but just not as long as the PS1.

Hence the constant ten-year life cycle references. My impression is that Sony is taking the (extremely) long view with the PS3.

/shrug

I could be wrong, but that's been my take on it since it was released.
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Post by Keavy »

ScarlettPheonix wrote:lol- well according to some previous interviews I've seen with Sony- they want to see the PS3 have at least as long a lifespan as the PS1. The PS2 has had a pretty good run, but just not as long as the PS1.

Hence the constant ten-year life cycle references. My impression is that Sony is taking the (extremely) long view with the PS3.

/shrug

I could be wrong, but that's been my take on it since it was released.
Only problem with the PS3 right now is no really compelling reason for a person with a 360 to get one.

Hell, if you don't have one the lineup is greater and more diverse on 360 and with three RPG's due out by the end of the year (Blue Dragon, Lost Odyssey, Eternal Sonata) I see no reason to not own a 360.

Well, ok there is one: if the only available 360 at any store is this one.
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Post by ScarlettPheonix »

I actually fully intend to get a PS3 when my PS2s finally bite it instead of a 360 or a Wii.

Part of it is loyalty to the brand (we both tend to stay with brands and companies that have worked for us in the past) but also- the PS3 is an all around better upgrade to our PS2s. I'm not saying that out of blind fanboism either, we both looked at and researched the capabilities of all of them and the PS3 suits our preferences/wants better then the 360.

The fact that there have been less reported issues of them breaking down is also an added consideration, as is the fact that my husband hates MS with a passion and refuses to believe that they can design anything that doesn't have issues at its release- or for significant time afte the release date.
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