In the early months after the console's launch, Microsoft stated that the Xbox 360's failure rate was within the consumer electronics industry's typical 3% to 5%.[11][12][13][14] Nevertheless, Microsoft has not released its official statistics on the failure rate of the various versions of the console; the company's press relations policy is to focus on the prompt resolution of any technical problems.[15]
On July 5, 2007, the Vice-President of Microsoft's Interactive Entertainment Business division published an open letter recognizing the console's problems, as well as announcing a three-year warranty extension for every Xbox 360 console that experiences the "general hardware failure" indicated by three flashing red LEDs on the console.[16] A source that has been identified as a team leader and key architect in the creation of the Xbox and Xbox 360 and a founding member of the Xbox team[17][18] provided insight as to the high rate of failures. The interviews suggest that Xbox 360 units that fail early in their life do so because of problems in the system design, parts supply, material reliability, and manufacturing issues as well as a system not tolerant to faults. These issues were alleged to be the end results of the decisions of management in Microsoft's Xbox team and inadequate testing resources prior to the console's release. A second source cited that, at one time, there was just a 32% yield of one of the test production runs. 68 of every 100 test units were found to be defective.[19][20]
On the 8th of February 2008, during the Game Developers Conference 2008, Microsoft announced that the "Failure rate has officially dropped", but without mentioning any specifics.[21] The same month, electronics warranty provider SquareTrade published an examination of 1040 Xbox 360s and said that they suffered from a failure rate of 16.4% (one in six). Of the 171 failures, 60% were due to a general hardware failure (and thus fell under the 3 year extended warranty). And of the remaining 40% which were not covered by the extended warranty, 18% were disc read errors, 13% were video card failures, 13% were hard drive freezes, 10% were power issues and 7% were disc tray malfunctions.[22][23] SquareTrade also stated that its estimates are likely much lower than reality due to the time span of the sample (six to ten months), the eventual failure of many consoles that did not fail within this time span and the fact that many owners did not deal with SquareTrade and had their consoles repaired directly through Microsoft via the much publicized extended RROD warranty.
People who experience the problem will find that they have to send the Xbox 360 away for repair or replacement and it may take up to 3 weeks to repair or replace. During the time of the Xbox being replaced, Microsoft and UPS will keep the client(s) updated with the current status of where the Xbox is and whether it is being repaired or replaced.
On October 17, 2008 a class action lawsuit was filed in California against Microsoft over the RROD problem.[7]
On August 28, 2009, SquareTrade published a report saying that "early indications point to the problem abating in 2009", projecting that 1-year failure rates with the Jasper chipsets might be below 4%.[24]