1) Full Voluntary Recall

2) Send out a semi-quality game (older game probably would work well) To all who return their 360

3) Extend the warranty to a full 3 years for all problems

4) Address the problem, appologize for past mistakes, and make customer service their number one priority

Knowing microsoft, none of these are likely, but it would go a long way to establish their gaming division as a brand known for quality and deserved respect.

@Legend,

Dude, enough with the damn trolling, Killzone made a legit post with an on topic opinion and you flame the PS3 in a MS thread? Do you even realize how childish this makes you look? Nobody respects this type of stuff, it just makes you look bad.

@Killzone3,

Responding in kind only lumps you into the same category.

I don't know what to think of both of you half the time. Sometimes you are completely capable of rational debate and other times you just go off the deep end and are completely unreasonable. Jesus I sound like my GD parents...which only means you guys are acting like kids. Grow up, both of you.

I am hardcore. I was ready to be an xbot all the way... how quickly it changes from blind devotion to blind with rage.

@TheBigFatJ: I mean that MS would cover all hardware problems in #2 and #6.

I can not think of way to solve their problem without wasting another billion dollars or so. MS took a lot of time to admit they had a problem. It was like they expected the problem to solve itself. IMO this is what happened.

End of 2005 - anecdotal evidence suggested that launch 360s had issues. Ms just ignore it like almost any company would

around march 2006 - costumer service gets a lot of angry calls. Some 360 owners feel cheated when their system break just a little after the warranty expires. MS think the failure rate may be a little over 5%, but no big deal PS2 had a lot of problems and sold more than 100 m.

late 2006 and holidays - Data suggest that 360s have a problem. It is selling really well, there a lot of games on the way, owners love the system. Analysts at MS say that even with the failure rates are 10%, they should not scare the market with a recall. MS can not adress the problem just when PS3 and Wii arrived, that would kill their 1 year advantage.

early 2007 - the competition steal some sales from the xbox. RROD ghost refuses to go away. Data updates show a higher than 15% failure rate. The guys at MS gaming division are losing hair thinking about it. Something must be done, but telling how big the problem really is could take 360 out of console race a little early. They can not afford to do this when the "Wii fad" is so hot.

middle 2007 - xbox reach critical mass. There is no way to deny it anymore. So many systems are broke, so many consumers are complaining. The 3 year warranty extension helps to keep MS "good" image but do not solve the problem.

The problem is that they now have some 10 million consoles at the market. Switching them all at once would make it impossible for MS to profit even if they stayed into the game market for another 20 years. They ignored the problem early on thinking it would pay off later when they were market leader. IMO they should have taken it slowly. Like shipping less units until the problem was fully solved or investing on research early to make a RROD-free version when xbox numbers were at 4-5 m.

If xbox was not already 7 billion in the red, they could slow down and just aim for a 3rd (profitable) place. That is not the way how MS do their business and that is why they are in a delicate situation.

To help them with their image I agree with everything the other users said.
1) Tell consumer they fucked up and that they are sorry.
2) Make the repairs as fast as possible. Waiting one or two weeks to play your favorite games do not make a great user experience.
3) Compensate us. Free games, discounts, gifts, Ms points, whatever. Just do not give them a cheap 1 month gold Live, make it at least 6.

Well the thing is they can afford to put another billion on it.... even if the share holders wouldn't be happy....  with high PR announcement... a square plan aimed at dominating the market on long run, could be more interesting than loosing the market....

you know if they don't do it it's usually because they don't need it... I have in the past been in  a marketing crysis strategy team... and you explore all possibilities... but at the end you don't do the one who please the customer the most but the one which is going to generate the more profit.... or at least the more damage controle...

@Sqrl

You're right, I was acting childish when I tried to start a flamewar because I didn't like what some people in the thread were saying.

@Killzone3

I apologize to you for what amounts to trolling because I didn't like what some people were saying in the thread. The worst part is that you actually came into the thread and were civil and didn't deserve me purposely attacking something I know you like.

 Thank you, I can't even begin to explain how much I appreciate someone setting a good example on these forums.  I know we have had our differences in several threads but respect +10 on this one.