In what will surely go down as one of the best examples of what not to do when finalizing contracts and performing background research on new business partners, it has been revealed that the primary cause of the Xbox 360’s fatal “Red Ring of Death” error came down to clerical errors and poor research on the part of Microsoft. Being a multinational mega-corporation itself, Sony has literally hundreds subsidiary companies, not all of which are openly known to be owned by and take direction from Sony Corporate.

It seems Microsoft contracted one of these Sony-owned subsidiary companies (TeikaData Inc.) for a few key components in their flagship Xbox 360. That lapse of judgement combined with a contractual obligation for the parts to have a MTBF (mean time before failure) of at least 8,750 hours which is around 12 months (instead of the expected 87,500 hours or 10 years) has led to massive system failures at or around the 12-months of use mark. The beauty of this foul-up is the way the contract was written; Microsoft is forced to use these parts and cannot substitute replacements for these particular parts until the contract expires, which is either at 50 million units or 5 years, whichever takes longer. Surely budding lawyers and engineers will be covering this case at length in future lectures as prime examples of how two seemingly small and fixable problems can compound into a massive brand-killing disaster. When contacted for comment, Ken Kutaragi (now on assignment setting up another “stealth” Sony subsidiary) simply looked at his calendar, smiled, and said “And now you know the real reason the PS3 was delayed, to coincide with the public fumblings and downfall of the ex-box.” after which he lit a cigar with a burning hundred dollar bill and went back to work designing flawed parts to sell to competitors.

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