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Microsoft predicted RROD; still would unleash it upon the world
Sorry 360 owners - the post wouldn’t be complete without it.
Lets get one thing straight off the bat: Microsoft never intended to infect the 360 market with RROD consoles. In fact, in their haste to release the 360 a year ahead of the Nintendo Wii and the Playstation 3, Microsoft ignored potential warning signs of a 68% failure rate among test consoles. For those of you keeping score - that’s 68 out of 100 Xbox 360’s that were pretty much doomed from the get go.
But, what’s even more interesting, is that Microsoft still stands by its release strategy. By releasing a full year ahead of the competition, Microsoft believes its targeted markets that potentially could have been swept up by Nintendo and Sony had it released along side them. The numbers, however, tell a different story.
Microsoft had lost a reported $1.15 billion to extended warranties - I mean couldn’t they have spent this money on more quality control before the release? Here’s the kicker, even with the price cut to the 360’s, the Big M intended the console to be even cheaper at this point in its lifecycle. Wait, what?
So here’s the rundown of what’s happened:
- Microsoft thought up the Xbox 360.
- Wanted it to be under approximately $200.00 (likely for a premium console).
- Tested it vigorously but ignored all issues of over heating and GPU meltdowns which may have been solved with another $2.0 million in quality control.
- Released it in November 2005.
- Had to extend warranties in 2007 costing the company $1.15 billion.
- 360’s receive a price cut - but could have been cheaper if not for the loss.
Nice work Microsoft. I applaud the aggressive marketing strategy and pushing to get your console first out the door - but if you had taken just a little more time to test the 360 you really could be dominating the market with a much lower priced console. You could have easily crushed the psychological $199.99 price point, eliminating any need for a PS3 and could be battling it out for top spot with Nintendo.
They say time heals all wounds; but $1.15 billion vs. $2.0 million is going to take a lot more than time.
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