It is interesting to see how strong the support is at 6000 DKP for the stock. I for one think it's ridiculous to be predicting the Xbox 360 will sell over 60 million units worldwide. There has been little demand for the 360 outside the US and momentum has severely diminished since the Wii and PS3 hit the stage. MSFT has cut its forecasts over and over again and still couldn't even meet the 12 million unit target.
On one of the national news channels this morning (in Canada), E3 came up and a few news items were mentioned (such as the PS3 price cut). Interestingly, the 360 seemed to get cut down a bit for "hardware failures". I only mention this because there was NO coverage of this in the mainstream media here until MS admitted a problem.
My point is that while their extended warranty and public admission of hardware issues may be welcomed by hardcore gamers, I think that the mainstream press coverage of it will cause a great deal of harm to the public image of the 360 and lead to some people considering it a "faulty" console. Thoughts?
I would not be to disheartened by people who see the positive of a company willing to back up its hardware with a 3 year extended (limited) warranty.
What Microsoft have done is admit a problem but not only admit but also retrospectively. Now I suspect this issue was ready to explode and they are being proactive but the fact is they nipped it in the bud.
In some respects the knowing that you can get it fixed even though it should not get broken in the first place is outweighed by the desire to have own one.
I would be suprised if we did not see a sales spike attributed to this news. This will go some way to staunch the flow of bad news but if they cannot get their act together on the customer support side this will only be short lived.
Fox news (TV not Web) just had a story on the Xbox warranty and pegged the failure rate at between 20 and 25%. Wasn't 'expecting' the story so I didn't hear the source for those numbers.
I definitely wouldn't buy one right now, even with the warranty. This is mostly based on my assumption that Microsoft will fix this problem by December, which I think they will.
I doubt sales will return to normal because of this warranty. I'm sure there are a lot of people with the same mind set as me (just wait till the problem is completely solved, THEN by one), but I'm also sure there are many that don't even know this warranty exists. All they've know is that a friend had a 360 die on them (or a friend of a friend) and they no longer see the 360 as a reliable product. Not everyone follows gaming news.
For me reliability is a HUGE issue. Even with Microsoft extending the warranty, sales shouldn't pick up again until the problem is completely erradicated.
If I have a choice between buying something of quality that has a high chance of "dying" on me and needs replacing, and buying something of inferior quality that has no reliability issues, I will go for the latter.
If sales return to normal based purely on the warranty issue I would be extremely dissappointed in people in general. They would be showing Microsoft that they can sell shoddy merchandise and get away with it as they have done for years. Don't get me wrong, I'm not anti-microsoft. I probably couldn't count on 2 hands the software on my computer that was created by them.
I would genuinely like to see the opinions of those who haven't entered the console war yet and bought one of the big 3.
Would a reliability issue seriously sway your opinion and your wallet away from the X360? And at what point would you then reconsider being swayed back, just the extended warranty or when the problem is totally gone?
Microsoft have finally moved to stem the flood of criticism against the 360 failures. A 3 year warranty against the rings of death should help those waivering and give solice to those who were worried about their own as yet unaffected console. I for one was finding it difficult to recommend the 360 to anyone purely based on the returns.
They will of course need to improve the return process as well as this has certainly been an issue. That said the returns are certainly higher than they expected and this acknowledgment of the problem will hopefully flow down into the relevant customer service call centers.
With this behind them I would expect sales to pick up again and with the newer systems having now been admitted to having work done to improve them the failure rate issue should start to recede.
How this repair bill hits Microsoft with regards to a possible price cut remains to be seen but in my opinion they will have no choice but to lob off a sizeable chunk off the price when Sony reveal their price cut widely expected before then end of this year.
For my part I will whole heartedly be recommending this system again. The media and game library alone and a favourable price make this system a worthy purchase even against its more reliable competition.
I posted this under MS but thought I should here too:
A report on BNN (Canada's MSNBC of sorts) just indicated that Microsoft will be announcing a +1 Billion dollar charge this quarter as it deals with an 'unacceptable level' of hardware problems with Xbox 360.
It is extending warranty coverage (retro actively) to 3 years.
I think it is testament to the 360's strong games library that despite the continuing reliability issues both perceived and real the stock appears to continue to rise.
I personally now doubt the success of the 360 unless they can turn this real\percieved reliability issue round. The past month has seen the strongest critism yet with regards to the reliability and support issues.
The PS3 in my opinion is now on the cusp of a sales explosion if it can find the magic price and Microsoft cannot resolve this issue satisfactorily. It had always been my thought that if Sony droped the price MS could drop even further but now I am beginning to wonder if these quality issues are now sufficient enough to change that view.
Certainly the PS3 community love the almost daily reports coming from an EB manager here a service center their.
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