To our Xbox Community:You’ve spoken, and we’ve heard you. Good service and a good customer experience are areas of the business that we care deeply about. And frankly, we’ve not been doing a good enough job.

Seriously, stop flooding our forums and our employees’ blogs with comments. Anyone with a pulse knows we’ve been providing horrible customer service for almost two years now.

Some of you have expressed frustration with the customer experiences you have had with Xbox 360; frustration with having to return your console for service after receiving the general hardware error message on the console.

That “11 failed 360s” guy really gave us a PR black eye. In addition, the office in Bangalore keeps complaining to us that they’re not going to take our customer service calls if we keep handing them angry people.

The majority of customers who own Xbox 360 consoles have had a terrific experience from their first day, and continue to, day in and day out. But when anyone questions the reliability of our product, or our commitment to our customers, it’s something I take very seriously.

The Xbox 360 is awesomesauce. We have a market lead, and we’re not about to let mass awareness of our console failures cost us the upper-hand.

We have been following this issue closely, and with on-going testing have identified several factors that can cause a general hardware failure indicated by three flashing red lights on the console. To address this issue, and as part of our ongoing work, we have already made certain improvements to the console.

Our engineers have made guarded statements that they are beginning to reach a conclusion that they might know what’s wrong with the 360. Even if we do know, we’re certainly not going to be telling you.

And please ignore the statements we’ve made denying that we added more cooling to the 360. Clearly, you didn’t buy it.

Those red lights are really starting to irritate us.

We are also implementing some important policy changes intended to keep you in the game, worry-free.

We know that the PS3 is headed for a price break, and we’d like to make sure that people keep buying 360s.

As of today, all Xbox 360 consoles are covered by an enhanced warranty program to address specifically the general hardware failures indicated by the three flashing red lights on the console. This applies to new and previously-sold consoles. While we will still have a general one year console warranty (two years in some countries), we are announcing today a three-year warranty that covers any console that displays a three flashing red lights error message. If a customer has an issue indicated by the three flashing red lights, Microsoft will repair the console free of charge—including shipping—for three years from the console’s purchase date. We will also retroactively reimburse any of you who paid for repairs related to problems indicated by this error message in the past. In doing so, Microsoft stands behind its products and takes responsibility to ensure that every Xbox 360 console owner continues to have a fantastic gaming experience.

This is costing us a fortune, and we hope you appreciate that.

Three years give us just enough time to implement hidden hardware changes in the consoles we send back to you to make sure the red lights go away.

If we have let any of you down in the experience you have had with your Xbox 360, we sincerely apologize. We are taking responsibility and are making these changes to ensure that every Xbox 360 owner continues to have a great experience.

This will take a few days to roll out globally, and I appreciate your continued patience as we launch this program. I’ve posted an FAQ that should address some additional questions, and we’ll update it over the next few days.

I want to thank you, on behalf of all us at Microsoft, for your loyalty.

We can’t believe that so many of you continue to buy and use the 360 even with all the hardware problems, but we’re thankful for your loyalty and we want to do you right as customers.

Seriously:

There’s no negative way to spin this. I can barely come up with any humor in it, either. It’s an amazing customer service move by a company not always renowned for their customer service. It’s going to cost them anywhere between 1 and 1.5 billion (that’s with a “b”) dollars to implement this program, and they’re even making an effort to roll it out worldwide.

Announcing this pre-E3 is a great move and will give them some goodwill momentum even before they make their software announcements.

Very impressive.