“The infamous Xbox 360 ‘red ring of death’ (indicating a failed unit) has caused Microsoft – and its customers – untold pain in the three years since the console’s launch in 2005, and cost it $1.15bn (£738m) last year. Microsoft has never said publicly why the console was plagued with faults: it seems that poor production quality was at the heart of the failures – an all-round problem with no single cause except impatience on the company’s part as it tried to become the leader in videogame consoles,” Dean Takahashi reports for The Guardian.
“With the first Xbox, the company lost $3.7bn (£2.3bn) over four years, mostly because costs of the box – particularly its hard drive – were too high. Bill Gates didn’t really care about the losses; that was simply the ante for getting into an exciting new business. But Steve Ballmer, who took over from Gates as chief executive during the first generation, really wanted the Xbox business to be profitable second time around,” Takahashi reports. “Even though early testing showed that production machines had flaws, Microsoft didn’t delay the launch because it believed the quality problems would subside.”
“Some of the defects were latent, potentially not showing up for some time after the machine was used. Up to 50% of all defects can be latent. And production yields – the number of machines coming off the production lines that passed testing – were low. In August 2005, the machines’ aggregate defect rate – from Microsoft’s contract manufacturers Flextronics and Wistron, in their factories in China – was allegedly just 68%” Takahashi reports.
“In a memo dated August 30 2005, the team reported overheating graphics chips, cracking heat sinks, cosmetic issues with the hard disk and the front of the box, underperforming graphics memory chips from Infineon (now Qimonda), a problem with the DVD drive – and more,” Takahashi reports. “Microsoft has never disclosed its actual return rates. But according to data obtained by VentureBeat, the total number of returns climbed above 1.2m consoles early last year. That is a huge figure, considering Microsoft had only shipped 11.6m consoles to stores by the time of the writeoff in mid-2007.”
“Nintendo’s Wii has outstripped rival consoles around the world, having sold some 35m machines since its launch at the end of 2006. Microsoft has sold about 22m Xbox 360s since its 2005 launch, while the Sony PS3, which came late to the party with a European launch in March 2007, has sold 16.6m consoles around the world,” Takahashi reports.
The full heartwarming article – recommended – here.
[Thanks to MacDailyNews Reader “Denis” for the heads up.]
Just red ringing Microsoft…
What does this story have to do with politics?
hilarious, politics.
So the behemoth spent all that effort and money – and then came last in the race?!
Pathetic.
More enjoyable destruction of MS here:
http://www.macnightowl.com/2008/11/microsoft-remains-divorced-from-reality/
I wonder if the “Lemon Law”, originally written for poorly made automobiles, could be used to sue Micro$ucks for this?
If Microsoft ever built a computer… yeeesh.
I know I was grateful the program. Mine was a 2006 xmas gift and it blew a tire six months later. They turned it around in Texas and had it back to me in 8 days. I have two years left on the adjusted warranty.
Far Cry 2 sucks like a pool drain.
I bought my first Xbox and had to return it very soon after. The disc drive stopped working. Got my replacement and used it for about 6 mos before red rings of death. Then got it repaired and 7 mos later got red sings of death again on the same machine!
XBox 360 is a POS. If it wasn’t for Halo I would have one.
I wonder if the “Lemon Law”, originally written for poorly made automobiles, could be used to sue Micro$ucks for this?
How could it, if you only have one model?
Look at how quickly Saturn rose to popularity because they started out with a single model. If your cars are handmade and you focus all your energy into producing one at a time, there are no lemons.
In any competition, Microsoft clutches like a boxer with a twelve-in waist. Like Farley on a biscuit, they do more to spoil it for themselves than any company I have ever seen, and they get away with it, because they’re filthy rich and because the pundits and the journalists are all wearing beer goggles.
They should take my advice and build the xbox using hardware virtualization! That’s where they are ultimately headed anyway, building machines from software.
I would love to throw a microsoft-made xbox 360 onto my Mac.
“was allegedly just 68%”! Is that 68% reject or 68% that past testing?
What delusional idiot thinks that 32% reject is ready to go into full production? How do these guys stay in business?
Microsoft PC-360
Imagine getting an xbox 360 with the purchase of every PC. Or would it make more sense to produce a retail box? Would there be a Mac version or would Microsoft use it as leverage against the Mac? It would be a differentiator unmatched.
For the cost of a windows license, suddenly the entire 360 library becomes available. What would that do for gaming in the PC world? It would explode. Many would probably consider upgrading to a new PC just to get the embedded xbox.
Imagine what that could do for Dell? What about Sony? With help from VMware could they craft a PS out of software and include it in the Vaio line up?
Inquiring minds want to know.
My day 1 purchased xbox 360 red ringed 6 months ago making me have to ship it off to be fixed. It was away for about 4 days all together.
Yet of all 3 consoles it’s the one I’m most happy I’ve baught (had a Wii, what a waste of money that was as I’m over 6 years old).
Also I’ve had my fair share of problems with Apple products. iPhone 3G being dead out of the box. iPod 3rd gen remote control broken within a week. G5 tower having RAM slot issues. But we don’t talk about that stuff here.
I have a PS3 – my buddy came over – who owned a Xbox 360 – saw it, and was blown away by it. Soon after that, his Xbox got the red ring and he sent it away for repair. When he got it back fixed, he sold it on eBay and bought a PS3.
The PS3 is a really powerful machine…
This is a prime example of Microsoft operating principle: they do not care about product quality or customer experience, or (lol) innovation…they only care about market share. Maybe they will learn from this lesson in shooting craps with their cutstomers…
@NeverFade…
” width=”19″ height=”19″ alt=”smile” style=”border:0;” /> End of story. Xbox loses.
PS3 has Blu-Ray too.
The Dude abides.
Politics?
Microsoft will soon be in line for a government bailout.
What are people complaining about. A 68% defect rate is still 32% better than Vista’s defect rate.
@Open Close:
The problem is not that its not being discussed here. The problem you are experiencing is not significant enough to warrant any attention. Just look at the bought rate and return rate. 11 million bought it (X-Box 360) and 1.2 million returned it. That’s almost an 11% defect return rate.
I’d be pressed really hard to find Apple with such a high defect rate. In fact, I have not seen Apple with such a high defect rate. I could be wrong.
The thing that the article mentioned for ways to make the XBox 360 more competitive could also be said of the PS3: make the pricing even more competitive. However, since many at first saw it (PS3) as a relatively cheap BlueRay Disc player with a PlayStation thrown in as a bonus, I guess it’s not prohibitively expensive. Also, since it’s undoubtedly one of the primary reasons why BlueRay beat out HD-DVD, the PlayStation certainly can count having it built-in as a serious plus, at least once the media itself becomes a bit more competitive and as widely adopted as DVD currently is.
@OpenClose, Every product has some problems. The problems with the Xbox 360 are epic in proportion, compared to anything you are talking about. If your iPhone 3G was DOA, that’d be hard to do, since the store rep opens the box, and activates it. If it’s dead, they’d never give it to you. And what’s a remote control on an iPod? You mean the clicker?
A new name suggestion for the red ring of death: Ballmer’s Butthole
I can’t figure out what problems with an XBox360 have to do with news related to Apple…
This article is proof of why I have not nor will I ever in the future buy an Xbox game console of any kind. Besides, our family has been more than happy with the Nintendo Wii and Sony PS3 (which is also used a lot for Blu-ray movies) that we have anyway.
You shitheads wouldnt know good customer care if it rose up and bit you in the ass. Remember Lisa? Newton? MobileMe? Itunes? (any iteration you choose) QwikTime? You will forgive me if all arent mentioned here. But Apples shit is hardly noteworthy.
@G4Dualie,
I don’t think there is any requirement regarding the number of models. I think the law is there to protect consumers from companies that knowingly release defective products – which it sounds like M$ did.
“I can’t figure out what problems with an XBox360 have to do with news related to Apple…”
It makes then feel better about the flaming laptop batteries and benzene fumes coming from their MacBooks.