Yeah, I was as surprised to hear it as you probably are. Pretty cool in one way... Microsoft is putting $1.5 billion away to cover any warranty issues. I'm not sure what the unforseen problems are, and none of my 3 XBox 360s have failed, although one was DOA and replaced same day, so that's 1:4 failure, but a bad measure :)
BTW, Microsoft says the XBox game unit will be profitable in 2008. Maybe this means we'll get an update to the Zune in 2008 as well? (please?)
Here's the article on News.com:
Microsoft said Thursday that it will take a $1 billion charge as
it extends the warranty on the Xbox 360, after an investigation showed
the game console can be prone to hardware failures.
"As a result of what Microsoft views as an unacceptable number
of repairs to Xbox 360 consoles, the company conducted extensive
investigations into potential sources of general hardware failures,"
Microsoft said in a statement.
Microsoft said its probe found "a number of factors" that can cause a
general hardware failure indicated by three red flashing lights on the
console. The company said that, in addition to extending the warranty, it has made unspecified design changes to the product.
Microsoft also disclosed Thursday that it failed to reach its target of
selling 12 million Xbox 360s by the end of its fiscal year on June 30.
The company sold 11.6 million units, CFO Chris Liddell said during a
conference call.
Read the entire article here...