Microsoft Refusing to Take $10 Million Worth of Defective 360s from EB Oz?

ebgames_logo.jpgUpdate 1: Microsoft has responded to our request for a comment.

Update 2: EB Games Australia has commented on the rumour.

Over the weekend, a Kotaku AU reader sent through a chat log containing an enlightening conversation with “an associate of mine who holds a high position within the EB organisation”. According to the log, Microsoft is refusing to take responsibility for its defective consoles, leaving it up to the games retailer to make the best of a crappy situation.

Obviously we’re trying to verify the facts, but for now, there’s no reason not to let you guys know of the potentially nasty relationship that may exist between EB Australia and Microsoft.

The transcript had the following preface:

An associate of mine who holds a high position within the EB organisation (Who wishes to remain incognito) has requested that I send in a paste [of]this chat log that details a stand-off between EB Australia and Microsoft regarding faulty XBoxes.

Mysterious, no?

It gets better, after the jump.According to the transcript, EB Australia has $10 million worth of defective Xbox 360s gathering dust, as Microsoft is unwilling to take them back. As a result, EB is no longer stocking the 360, except as second-hand or pre-owned units. A search of the EB Games website for “xbox 360” confirms this.

“There have been threats of EB dropping the Xbox range all together,” says the transcript.

To recoup its losses, EB is trying to repair the defective units and offer them as second-hand. However these units are often returned dead, the transcript states. It also mentions that EB lost $85 per console sold once Microsoft introduced the standard three-year warranty, as EB was unable to offer its own.

“Add to this the fact that price matching got really cutthroat during this past Xmas, they were selling far too many units under-cost and getting a bunch back defective, but Microsoft [refuses]to reimburse for,” the transcript says.

“The whole 360 RRoD [has]been extremely costly to EB Australia.”

“Feel free to believe me or not but go and ask a local EB if they have or when they’ll be getting in 360 Premiums again and nobody will be able to give you a straight answer except along the lines of ‘sold out’ and ‘don’t know when they’re coming back in’.”

This morning I rang up three separate EB Games stores in and around the Sydney CBD, and all provided a variation of the words “out of stock”. One mentioned that it was waiting for Microsoft to send through more.

If all this turns out to be true, it’s a rather damning look at Microsoft’s commitment to retail, not to mention the reliability of its own console. And a major chain like EB not stocking the Xbox 360, with the potential to pull down all related stock, is a huge deal.

Never fear – we’ll be chasing this up with Microsoft to see what its side of the story is.

Update: Looks like EB still has the Premium listed. Sadly, this doesn’t change the fact that the stores I contacted were out of stock.

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