The fault has become known as the ‘Red ring of death’ because of three flashing lights which indicate a catastrophic hardware failure. It is believed it could affect between 10 to 30 per cent of the 1.4 million units shipped outside the US, Europe, Middle East and Africa markets.
However, Microsoft has declined to reveal the exact number of units involved.
The strategy will see the tech giant replace affected Xbox 360s for free in some circumstances; reimburse consumers who have already paid for repairs, and extend the current one-year warranty to three years.
Andres Vejarano, regional marketing manager, Microsoft, entertainment and devices division, Asia, said “Microsoft stands completely behind Xbox 360, as we do with all our products. ”
But PR industry sources said the incident has the potential to permanently damage the Xbox brand.
“Consumers were reporting this problem for months, so they have taken a long time to address the issue,” said the source.
“There is so much competition out there from Sony and Nintendo — they’ll really capitalise on this.”
Microsoft has confirmed it has devised a fix for the problem, which coincides with numerous media and analyst reports suggesting the tech giant is preparing to slash the price of its consoles in response to a recently-announced move from Sony PlayStation, although Microsoft denies it will cut prices of its console.
