Xbox 360

• 1. The Console That Changed Living Rooms

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  On the 22nd of November 2005, Microsoft launched the Xbox 360 in the United States and Canada, kicking off what would become one of the most consequential console generations in gaming history. Production had begun only 69 days before that launch date, on the 14th of September 2005. Demand far outpaced supply: the console sold out completely in every region except Japan, and 40,000 units appeared on eBay during the first week of release, representing 10% of the total available supply.

  By year's end, Microsoft had shipped 1.5 million units worldwide: 900,000 to North America, 500,000 to Europe, and 100,000 to Japan. The questions the console's story raises are not just about sales numbers. They are about how a second-generation American console broke into a market dominated by Japanese giants, how a hardware failure nearly derailed it all, and how a gaming machine became the center of a living-room entertainment revolution that no one had fully anticipated.

• 2. From Xenon to Xbox

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  Conceived in early 2003 under multiple codenames including Xbox Next, Xenon, Xbox 2, and NextBox, the Xbox 360 was born out of a deliberate and secretive engineering effort. Planning for the Xenon software platform began in February 2003, led by Microsoft's Vice President J Allard. That same month, Microsoft gathered 400 developers in Bellevue, Washington, to recruit support for the new system, and Peter Moore, former president of Sega of America, joined the company.

  On the 12th of August 2003, ATI signed on to produce the graphics processing unit. Before launch, Alpha development kits were spotted using Apple's Power Mac G5 hardware, because the G5's PowerPC 970 processor shared the same PowerPC architecture that the Xbox 360 would eventually run under IBM's Xenon processor. The cores of the Xenon processor were developed using a modified version of the PlayStation 3's Cell Processor PPE architecture. According to IBM employees David Shippy and Mickie Phipps, they were hiding their work from Sony and Toshiba, IBM's own partners on the Cell Processor project.

  One hardware decision that would shape the entire platform came from Epic Games. Originally the Xbox 360 was equipped with only 256 MB of RAM. Epic demonstrated to Microsoft that 512 MB was needed for substantially better performance. Epic's Executive Vice President Mark Rein recounted the moment in 2006: the chief financial officer of MGS called him to say, "I just want you to know you cost me a billion dollars," to which Rein replied, "we did a favour for a billion gamers." The final machine ran the triple-core IBM Xenon CPU, with each core capable of processing two threads simultaneously, and the ATI Xenos GPU with 10 MB of eDRAM.

• 3. The Red Ring Crisis

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  No chapter in the Xbox 360's story drew more attention than its hardware failures. Since the console's release in 2005, users reported serious concerns about its reliability and failure rate. The most visible symptom was the "Red Ring of Death": three quadrants of the ring around the power button flashing red, indicating a general hardware failure.

  Microsoft extended the Xbox 360's manufacturer warranty to three years to cover hardware failures generating a "General Hardware Failure" error. In April 2009, the warranty was further extended to cover failures related to the E74 error code. Engineers modified the console design in response: changes included reducing the number and size of components, adding epoxy on the corners and edges of the CPU and GPU to prevent movement during heat expansion, and adding a second GPU heatsink to dissipate more heat.

  The solution arrived definitively with the Xbox 360 S, released in 2010, which featured a redesigned motherboard intended to address the overheating issues of the original models. A further revised model, the Xbox 360 E, followed in 2013 with a two-tone rectangular case inspired by the Xbox One design, though it dropped one USB port and no longer supported S/PDIF audio output. The S and E models used standard 2.5-inch SATA laptop drives in custom enclosures. Hard drive options across the console's lifetime ranged from 20 GB to 500 GB.

• 4. Xbox Live and the Online Shift

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  When the Xbox 360 launched, Microsoft simultaneously shut down Xbox Live for 24 hours to conduct a major upgrade. The revamped service added a free tier called Xbox Live Silver (later renamed Xbox Live Free) alongside the existing premium subscription, which was renamed Gold. An Xbox Live Gold account carried an annual cost of US$59.99, with regional equivalents including £39.99 and €59.99. On the 5th of January 2011, Xbox Live reached over 30 million subscribers.

  Xbox Live Arcade, an online distribution service for downloadable games, was relaunched alongside the console on the 22nd of November 2005, now fully integrated into the dashboard. The Xbox Live Marketplace allowed users to purchase content using Microsoft Points, available in prepaid card denominations of 1,600 and 4,000 points, or through credit card purchases of 500, 1,000, 2,000, and 5,000 points. An estimated 70 percent of Xbox Live users downloaded items from the Marketplace. That Marketplace was discontinued on the 29th of July 2024.

  PC Magazine described the Xbox 360 as the prototype for online gaming because it proved that online gaming communities could thrive in the console space. TechRadar later named the Xbox 360 the most influential console of its generation, citing its emphasis on digital media distribution and multiplayer gaming. By March 2008, the console had achieved a software attach rate of 7.5 games per console in the US, compared to 3.8 for the PlayStation 3 and 3.5 for the Wii, according to Microsoft figures.

• 5. Games and the Software Battle

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  The Xbox 360 launched with 14 games in North America and 13 in Europe. Call of Duty 2, the console's best-selling title for 2005, sold over a million copies in that first year. Five other games also crossed the million-copy threshold in the launch year: Ghost Recon Advanced Warfighter, The Elder Scrolls IV: Oblivion, Dead or Alive 4, Saints Row, and Gears of War.

  Gears of War became the best-selling Xbox 360 game for 2006, moving 3 million copies, before Halo 3 surpassed it in 2007 with over 8 million copies. The 2007 Game Critics Awards honored the platform with 38 nominations and 12 wins, more than any other platform that year. Microsoft also secured simultaneous releases for games that had been planned as PlayStation 3 exclusives, including Grand Theft Auto IV, Final Fantasy XIII, and Metal Gear Rising: Revengeance.

  In Japan, Microsoft partnered with Mistwalker, a studio founded by Final Fantasy creator Hironobu Sakaguchi. Mistwalker's first game, Blue Dragon, released in 2006, sold out its limited-edition bundle with over 10,000 pre-orders. Blue Dragon is one of only three Xbox 360 games to surpass 200,000 units sold in Japan, alongside Tales of Vesperia and Star Ocean: The Last Hope. The last official games released for the system were FIFA 19 and Just Dance 2019, both in 2018, nearly five years after the Xbox One's launch.

• 6. Sales Geography and Legacy

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  Lifetime sales of the Xbox 360 reached 84 million units worldwide. In the United States alone, according to Circana data, that figure was 42.7 million units. The console held the top position in US current-generation home console sales until June 2008, when the Wii surpassed it. Between January 2011 and October 2013, the Xbox 360 was the best-selling console in the United States for 32 consecutive months. By the end of 2014, Xbox 360 sales had overtaken Wii sales in the US, reclaiming the title of best-selling seventh-generation console in that market.

  In the United Kingdom, the console took 110 weeks to reach 2 million units sold, generating £507 million in revenue. UK sales eventually topped 9 million units, making the Xbox 360 the best-selling seventh-generation console there and the third-best-selling console of all time in the region, behind the PlayStation 2 and Nintendo DS. In Japan, a notoriously difficult market for non-domestic consoles, lifetime sales reached 1,616,218 units, an improvement over the original Xbox's 474,992 units.

  Microsoft announced the end of Xbox 360 hardware production on the 20th of April 2016. At E3 2019, Xbox head Phil Spencer told Engadget that there were still "millions and millions of players" active on the Xbox 360. After the Xbox Series X and S launched in late 2020, the Xbox 360 still held a 17.7% market share of all consoles in use in Mexico, ahead of the PlayStation 4's 18.0% and comparable to the Xbox One's 36.9%, reflecting an unusually durable install base for a discontinued system.

• 7. Kinect and Multimedia Ambitions

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  Kinect, announced on the 1st of June 2009 at E3 under the codename Project Natal, gave the Xbox 360 a second wind. The peripheral enabled users to control the console through gestures and spoken commands without a traditional game controller, and was compatible with all Xbox 360 models. It was released on the 4th of November 2010, and set the record for the fastest-selling consumer electronic device in history at that time.

  The Xbox 360's multimedia ambitions ran well beyond gaming. The Xbox Video Marketplace launched in the United States on the 22nd of November 2006 (the console's first anniversary), offering high-definition and standard-definition television shows and movies for download. Television content came from providers including MTV, VH1, Comedy Central, Turner Broadcasting, and CBS; movie content from Warner Bros., Paramount, and Disney. In 2012, Microsoft introduced the Live Event Player, with the 2012 Revolver Golden Gods, Microsoft's E3 2012 briefing, and the Miss Teen USA 2012 pageant among its first streamed events.

  The New Xbox Experience dashboard update, released on the 19th of November 2008, replaced the original Blade interface with a layout derived from the Zune and Windows Media Center, using the Twist UI. A further major update rolled out on the 6th of December 2011, introducing Microsoft's Metro design language alongside cloud storage for game saves, live television, Bing voice search, and YouTube access. Xbox Music, announced at E3 2012, offered 30 million music tracks for purchase or subscription access, integrated with Windows 8 and Windows Phone.