In the more bad news for Microsoft department, general hardware failures in their Xbox 360 gaming console will cost Microsoft an estimated $1 to $1.15 billion dollars to repair, dealing more losses to Microsoft’s already unprofitable entertainment and devices division.
For users who experience the hardware failure, dubbed “the red ring of death” by some gamers, Microsoft will pay for worldwide shipping and repairs for three years.
Microsoft declined to detail the problems that have caused an onslaught of general hardware failures in recent months but said they will extend the warranty on the consoles to three years. Microsoft will also reimburse the “small number” of Xbox 360 owners who have already paid for shipping and out-of-warranty repairs.
“We don’t think we’ve been getting the job done” said Robbie Bach, President of Microsoft’s entertainment and devices division. “In the past few months, we have been having to make Xbox 360 console repairs at a rate too high for our liking.”