The Red Ring of Death threatened to destroy the Xbox 360 and the entire Xbox brand. Consoles were dying en masse. Microsoft didn't immediately know why, but it did know that it was a big problem. A plan was devised to fix gamers' hardware, but it wasn't going to be cheap: to provide the best possible experience for the unfortunate owners of expired hardware, units had to be overnighted to Microsoft, and then, once fixed, back to the waiting gamers. The total cost was estimated at $1.15 billion, $240 million of which was going to FedEx.
Peter Moore, now at EA but then head of Xbox, had to go to Microsoft CEO Steve Ballmer in 2007 to ask for the money to salvage the console's reputation. Ballmer agreed, the Xbox 360 was saved, and it was a huge success.
The full story of the Red Ring of Death, and many other stories, can be heard in the latest edition of IGN's Podcast Unlocked. The show features three different Xbox heads: Xbox creator Seamus Blackley, the Xbox 360-era Peter Moore, and the current head of Xbox, Phil Spencer.
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