Xbox 360 RROD: Why has it not killed Microsoft’s sales?
Filed under: Gaming, Xbox 360 | By: Peter Chubb
Posted on: December 4, 2008 | 10 Comments
I am troubled; we all know that the Xbox 360 has the RROD problem, so why has it not killed Microsoft’s sales of the games console. When you have a look at many of the gaming forums, it is full of Xbox 360 users complaining that their console has the dreaded Red Ring of Death.
Microsoft know that the RROD problem has been a major headache for them, so they had to come up with a way to generate more sales for the Xbox 360, even though they knew that public confidence in them could be low.
Microsoft has a secret weapon, they have very deep pockets so were able to offer a number of price cuts. Once those price cuts were passed on, sales of the Xbox 360 started to surge once more, something that Sony are reluctant to do with the PS3.
We know that Microsoft is thinking of themselves with the price cut, but it also benefits consumers which is why they are snapping up the Xbox 360. Microsoft hope to have solved the RROD issue, with the launch of the new Jasper chip, the console will now run cooler and is more energy efficient.
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Most buyers aren’t aware of the problems when they purchase and owners know that a 3 years warranty with a relatively speedy turnaround is more than what you get with the other consoles, despite them being less likely to have a problem.
Having said that nearly everyone I know has had RROD, my personal theory is they all had early models (no excuse I know) and left them plugged in, even when the console was off, which fried the board. Yet these people still love their repaired machines, haven’t had a problem since and still buy more games for their 360s than their PS3s. Their loyalty has to be said is mainly because of live and the continued build up of their achievement points.
People still buy the 360 because of the games. I’ve had the RRoD and got my console back in a little over a week. Yes, it sucked but it didn’t cost me anything to get it repaired and I love the games on 360. I know some people that have both 360 and PS3 and they all buy more 360 games which is the point of the console anyway right?
This really isn’t a 360 vs PS3 thing, they both have strong points and whatever you want is your choice. Buy the system you want and play the games that you like, just enjoy it.
The goodthing is people know they will get it repaired and for free. I have a PS3 that crashed after a update and it cost me £100 to get it back and running. So both the PS3 and Xbox have problems but atleast MS make sure it doesn’t cost you, not like Sony. Also you can but 3 Xbox’s for the price of one PS3… the only thing you would miss if you didn’t buy the PS3 is your doors would keep closing
and you would need to invest in a new ” Door wedge ” as that is all the PS3 is good for…. 
Yeah it is a testiment to MS’s PR machine and their Warehouses of Cash! Any other electronics product on the market with a 33%+ failure rate would have been killed off a long time ago. It will be interesting to see what happens with the Californian court case…
The thing about MS is that they are all mouth, they’d talk to you until they were blue in the face about how great the 360 is and how strong it’s sales are. But behind closed doors I’d love to know what their real opinion was - the billions they’ve spent on warranty claims, extending the warranties, the constant blanket TV advertising, the contracts for 3rd Party exclusives like Gears, the contracts for extra DLC like GTAIV, the lost revenues from the recent drastic price cuts that no doubt make the hardware loss-making again etc. It all must add to a colossal sum, not that you’d ever hear them discuss those sort of numbers in public.
At the end of the day, despite how well the 360 fanboys think the Xbox is doing, if this would have been ANY other company the 360 and the Xbox brand would be extinct by now. Imagine for example if it was the Sega 360 - it would have ended like the Dreamcast, just too costly to continue.
Call Sony all you want for their price, but they have a business to run and a brand to sustain, I’m sure everyone would love if Sony started selling PS3 hardware for less than it’s games cost - but how long do you think there would be a PlayStation or even a Sony if they did that? Not everyone has a multi-billion dollar software monopoly to fall back on.
Imagine a twisted reality where it was the Sony Xbox 360 and the Microsoft PlaySation3 - I can guarantee you the same MS PR men would be praising the early performance of the PS3 and how it was doing better than the PS2 and lambasting the competition for their shoddy hardware, and I can also imagine that Sony would be confirming their withdrawal from the Console market due to the unacceptable level of costs incurred from the 360’s hardware problems…
@PS3Owner
You are 100% correct on your statement, but that\’s what a PR team does. You wouldn\’t expect MS to hype up the strong points of PS3 would you? Yea, \”those guys have Blu-Ray, media slots, standard hard drives that users can upgrade with off the shelf hardware, etc….. it\’s great!\”… I doubt that\’s going to happen. Anyway, how many comments have you seen from Sony talking big **it about the 360? Look at the \”real time gameplay\” they showed for Killzone in 05 vs what really is coming out. I wouldn\’t say that Killzone doesn\’t look awesome, but, it\’s NOTHING like what they showed.
The truth is, if you look at all of the cross platform games, most (not all) have been better on 360 based on unbiased reviews. This would lead one to belive that the 360 is a better system right now for gaming… the reason we buy gaming consoles. The PR machine is strong with Sony and they resort to the lowest of low blows to try to win consumers over. Microsoft has had a very weak ad campaign until recently, not only for the 360 but the company as a whole. They\’ve not had hardcore advertising since XP launched.
On cost, MS has broken the red and they are actually making money on the 360 now even with the repair costs. You have to imagine the repairs are typically just that and they aren\’t sending out new consoles to each customer. They pay for shipping and some break / fix equipment, take your broken console and send out one that\’s already been fixed to replace it. Your old one gets fixed and ready to send out to the next guy… at least that\’s how it seems from the replacements that I\’ve seen people get. Only once have a I seen a whole new console as a replacement and that was my first one. I sold that one and bought an Elite a while ago.
So I say as a gamer, I am standing by my 360 until PS3 has something that simply blows me away, then I may consider owning both but the 360 stays. I also have a Wii that\’s more so a Mario Kart machine for the kids but I\’m not opposed to getting anything as long as it will provide value to me and I can\’t say that the PS3 will yet.
I have to say why should I care how much the 360 costs M$? Their finances are no concern of mine as long I get the service I require.
Sony have a great product with the PS3 but Playstations are the only electronics Sony produce that don’t magically pop as soon as the warranty expires (built in obsolescence) because the PS provides continued revenue through game purchases.
To sum up, all the companies are in it for themselves. The only reason any of them provide a good experience for buyers is to ultimately line their own pockets. Both companies have extremely deep pockets and lets not forget that while M$ had RROD Blu-Ray has cost Sony a fortune in lost sales, due to high prices and a delay in getting the product to market.
Before anyone accuses me of being a fanboy of any sort I own both a 360 and PS3 and think they’re both fantastic machines, each with their own flaws.
I think it’s a little naive to suggest that Microsoft is a huge money grubbing corporation, and Sony is not. Both of them are interested in the bottom line, but I suspect it would hurt Sony too much to drop the price right now.
Microsoft has gone on the record about why they have the arcade version of the console; last generation, it was too difficult to make price drops when the Xbox had a hard drive in every console. Now, Sony is experiencing that pain with the hard drive and Blu-Ray player in each console. The Arcade version of the 360 may be a sucker’s bet, but it does put an attractive price point on the shelves.
The RROD sucks, plain and simple. However, Microsoft repaired my broken console quickly, and for free - which is more than I can say for past consoles that have had similar problems.
It’s not a perfect console by any means - it just seems to be the best option right now.
Here are the reasons why RROD has not killed M$:
1.) M$ has a great following of loyal players (gamers)
2.) Replacments are free. The three year warranty should cover the majority of the console that were going to get the RROD
3.) M$ has enough $ to keep people happy. They get a free replacement and free stuff for their trouble
Sony is charging to repair the broken consoles because their issues are very small in comparison to that of M$ and are out of Warrenty. Sony is at 1% and M$ WAS at like 30%. This explains why M$ is paying to replace the item.
If M$ did not replace the faulty overheating devices for free, then it would failed tramendously. Also, their Nickle and Diming Policy (Online gaming, Themes, Pictures Packs, Memory Cards, Proprietary Hard Drives, Wifi, etc) has allowed them to fund the replacement project.
M$ is hoping that the new motherboards are safe enough that they would have not replace many more Xbox360’s.
There are also plenty of stories from Video Game Store empoyees about people buying the new Xbox 360 Arcade and then transfering the Hard Drive from their old burnt out console the new one with the new motherboard.
Also, during the initial phase of RROD replacements, many retailers (BEST BUY) would process the replacement as a sale.
These two items would explain some of the overall sales of the 360.
Don’t get me wrong. I understand and respect the fact the 360 has great games with great graphics. I just don’t like when people are kid themselves and start saying that one console is inferior to the other.
It’s like comparing cars. Their are made by two different companies. They are different. But the main thing is that they get you from point a to point b.
If you are happy with your game console, great. Support it and defend it. Just try to be educated about the arguments.
People who get burned should be mad. Not people who are mad about other people that get burned. PS3 fans get steamed because that HORRIBLE other white console is SMOKING their perfect $400-500 unit and cannot figure out why. My other white console had DVD drive issues. MS fixed them. MS knew it needed to get to the 199 price range and sell a unit with no HD. They are just like the other White console. The Arcade is 50 bucks more than a PS2 hmmmm I wonder what johnny is getting for Christmas a ancient PS2 or a HD xbox with two games and maybe a Free Guitar hero with a guitar. You are right PS3 is superior. So was the DREAMCAST!
I think the main reason it hasnt killed MS is because most people seem to think live is the best thing since laminate flooring. jokes aside, peole bought the 360 when it came out giving MS a chance to collect players online ultimately making it a better system online - even with its unreasonable cost. PS3 is technically superior and everyone knows this. I’m not biased as i only have a 360 but the warranty is not as good as you think. After one year and 1 week of having my 360 (the original warranty expires after one year) i got the 2 red lights. think about that - it is not free to repair as the 3 year warranty only covers all 3 red lights…im still stuck not knowing what to do with this piece of brickwork….