so. there has been some hullaballoo about microsoft offering free repairs on the original batches of of xbox 360’s. most folks are thinking “duh!” and a lot of other people are saying things like “better late than never.”
i’m a little skeptical tho. maybe it’s the marketing guy in me, but, timing anyone? hello?
here’s the skinny:
i don’t buy the “analyzing recent repair data” line. recent? it’s been almost a year. there was a flood of overheating requests at the beginning. they didn’t need a year to figure this one out.
so, what do they do? well. instead of a price drop, they are keeping the same “value” price, but using incentive techniques like bundling to add value to the 360’s on shelves. (stay with me, here. i’m getting there.) so, what is another subsidized “value-add” they can come up with? fixing (rightfully) busted xbox 360’s.
“all goodwill,” you say.
“exactly,” i say.
they know (as well as anyone with half a brain) that sony’s ps3 is going to have huge, huge manufacturing problems coming out of the gate. and, similar to “bundling” strategies employed by nintendo and microsoft, sony also has to deal with “free replacements” for this first batch. why? because microsoft is offering it on their xbox 360’s.
however, the difference is that microsoft is starting to break even on the hardware, so, it’s not that big of a deal to them. it just adds more cost pressures to sony who’s already taking a gigantic loss on the console itself.
so, it comes out as a win-win for microsoft. foster goodwill with the market. put another nail in the coffin of a competitor.