Microsoft Concedes Scratch Problems On Halo 3 Discs

Quality control problems continue to plague Microsoft's Xbox 360 platform -- and Master Chief isn't immune.

Within hours of Tuesday's widely-hyped Halo 3 launch, the company was conceding that faulty packaging caused scratches on an unspecified number of game discs that found their way into customers' hands.

Microsoft said the problem affects the $70.00 Halo 3 Limited Edition -- both the game disc itself and an accompanying Essentials disc. It insists the problem is cosmetic, and doesn't affect the discs' functionality.

In a statement posted on its Xbox Web site, Microsoft said it will replace damaged Halo 3 discs under an existing disc replacement program. The offer applies only to the Limited Edition, and customers must send in their discs by Dec. 31 to receive a new one.

Internet reports indicate that many retailers are allowing customers to exchange damaged discs on the spot.

Microsoft was forced to implement the disc replacement program after numerous Xbox 360 users complained that the machines were leaving scratch marks on their game discs and rendering them unplayable. Several Xbox users hit with the problem have filed lawsuits against Microsoft, seeking class action status.

Scratched discs aren't the only problem that red-faced Microsoft officials have had to deal with concerning the Xbox 360. Earlier this year, they acknowledged that a manufacturing flaw caused thousands of the machines to seize up after only months of use. The company took a $1.06 billion charge against earnings in the fourth quarter to cover the cost of fixing or replacing the broken consoles.

Reports of the scratched Halo 3 discs couldn't come at a worse time for Microsoft. The company is counting on the game -- which broke industry records with more than 1.5 million presales -- to revive its flagging Xbox franchise, which is under pressure from rivals Sony and Nintendo.

In its fiscal fourth quarter, Microsoft disclosed that Xbox 360 sales had plunghed 60% year-over-year.

Posts on gaming blogs indicate that Halo 3's disc scratch problem isn't endearing customers to Microsoft or the Xbox 360. On the TGDaily blog, a forum poster named Bill Davis said "there is nothing worse than buying something and going home and have it not work."