If comedy is tragedy plus time, it’s fun: Microsoft is now selling $25 “premium posters” commemorating Red Ring of Death, a systemic hardware failure on early Xbox 360 consoles that cost the company more than $1 to fix. billion dollars.
It might sound like a funny story a decade and a half from now, but in mid-2007 an RRoD bug was incredibly costly and devastating to the then-young console and brand. A temporary solution to Microsoft’s problem was a three-year warranty extension, which was reported to cost between $1.05 billion and $1.15 billion (roughly $1.5 billion in today’s dollars). The red ring bug was caused by heating issues and a “poorly designed graphics chip”and was not fully resolved until late 2008 when a new version of the console was released with a redesigned motherboard and cooler-equipped chips.
In an interview in 2015, then-Microsoft VP Peter Moore said that the warranty extension, while expensive, was a “Tylenol moment “that helped the company prevent permanent damage to the Xbox brand. He also thanked then-CEO Steve Ballmer for his decision to spend more than $1 billion on the problem: “I always remember that $240 million of that came from FedEx,”he said. “Their supplies must have skyrocketed over the next two weeks.”
The posters are part of a promotional campaign celebrating the 20th anniversary of the original Xbox, a campaign that includes a six-part documentary titled Power On. Even though it was produced and sold by Microsoft, the presence of an entire episode about the RRoD debacle suggests that it was not intended as a hagiography.