Today’s announcement by Microsoft that it will provide a 3 year warranty and repairs in order to eliminate the current issues with “Ring of Death” is rather expected. In their announcement MS also provided a warranty reimbursement for past repairs. Essentially this announcement will translate into a cost of up to $1 Billion for Microsoft.  

In terms of SWOT analysis, this announcement is certainly a great illustration of a potential weakness as well as thread. In terms of weakness, the hardware flaws that have plagued XBOX 360, have illustrated a great point of weakness. In terms of threat, such sudden and uncalculated cost is certainly a threat to potential future profits. Yet this is not unique to XBOX; Nintendo Wii had its issues and problems with its joysticks and Sony PS3 had software flaws. Hence leading to a logical conclusion that all the three major players had flawed products and entered the market prematurely which created unforeseen cost.  

Both the weakness and thread in this particular case is an illustration of a flawed organizational culture in which early comers and most of their end users are more concern with early market penetration with the conscious knowledge that such early penetration may compromise quality as well as create unintended negative consequences. Yet the benefit of early market penetration with its potential marketing benefits outweighs the quality concerns. Other industries such as the automobile industry have been living with this issue for generations.

Nevertheless, in terms of analysis the issues of early market penetration as well as inferior products illustrate formidable issues that have to be a part of strategic vision of a viable business concept as well as effective product scrutiny.

Brought to you by: Royalty Universe. Your one stop shopping information center