We’re all very proud of the success of the Xbox 360, but we also deal with Xbox 360 owners who are frustrated because they’ve had to send their console in for repair. We find the level of repairs unacceptable. Whether you feel like you’ve had to jump through hoops to get a console repaired, or you’ve been frustrated in having to deal with customer service, I want to join Peter in offering our apology, on behalf of all of us who spend our time with community members every day.

We are taking responsibility by enhancing the Xbox 360 warranty for consoles that experience general hardware failures, indicated by three flashing red lights on the console, to cover repair costs and shipping for all related repairs for three years from purchase. The existing console warranty remains in effect for all other issues. We are retroactively arranging refunds for anyone that paid for out-of-warranty repairs of a console that had three flashing red lights. Additionally, we’re enhancing some of our customer service processes and systems, and you should continue to see improvements with the experience you have when you call for support.

We have been following this issue closely, and through ongoing testing we’ve identified several factors that can cause a general hardware failure. We’ve already made improvements to the console to address this, and by offering this specific three-year warranty we want to show that Microsoft stands behind its products, and is taking responsibility to make sure every Xbox customer has a great experience.

I want to point out how important the community has been to everyone involved. I’ve been directly involved representing our community in meetings with executives, and everyone else behind the scenes in making this decision. At every step, we’ve all been paying close attention to what you—our community—are saying. Taking care of our customers has been the most important thing we hope to achieve, and we’ve all been doing everything we can to earn your ongoing trust.

Please be patient over the next few days as we roll out these changes. Because of the financial commitment we are putting behind this effort, we couldn’t communicate our plans broadly in advance, even to internal teams like our call centers. As a result, there are some processes that we’re putting in place almost real-time, and there will be some questions that we won’t be able to answer immediately. You should know that we’re doing all we can to address any issues or concerns, and we’ll keep the FAQ updated when we have additional information. We’ll also be keeping an eye on comments here, on Xbox.com’s forums, and other community sites.

All of us sincerely appreciate your passion for the Xbox 360, your patience when things go wrong, and your dedication and support as we make improvements.

Here are a few links with more information:

Press Release
Peter Moore’s Open Letter
Xbox.com Warranty Enhancements FAQ

[From Gamerscore Blog]