There are lots of reports of XBox 360 malfunctions in the news and all over internet. John Porcaro who works in Microsoft marketing has a response to all of the XBox 360 malfunction reports; from his post:
Even though there are some sensational headlines, it’s important to know that the reports of crashes and overheating are being exaggerated, at least in the mainstream press. Those that don’t have problems probably aren’t online (they’re happily playing games on their new Xbox 360). Sensational headlines sell papers, and because all the news up to now has been pretty positive, journalists (and Sony fanboys) are looking for a different angle to report.
I’m not saying the issues aren’t real.
We know that electronics can’t be 100% tested before shipping, and that shipping and storage and temperature and all sorts of minute manufacturing defects can affect a unit after a customer gets it home. It would just suck tremendously to have waited in line for 10 or 20 (or 40) hours, only to get your box home and find it doesn’t work. I’d be seriously pissed. It’s one thing to get the wrong kind size jeans--it’s another to get something home that you paid a ton of money for, waited almost a year for, stood in line in the freezing cold for, and basically did everything right to assure your spot at the top of the list, only to find out it doesn't work. And unfortunately, you can't just skip back to the store and trade it in like you can in most cases.
I firmly believe that when an issue affects you personally, it doesn’t matter that you’re in the minority. The problem is happening to 100% of the units YOU care about.
For you with problems, know that our customer service team is pulling out all the stops to make sure you’re taken care of as fast as possible. We have all the hardware we need to provide great customer care. We’re doing everything using overnight shipments (even shipping the prepaid overnight box for customers to use), and I’m told our troubleshooting team is turning around most units in 24-48 hours before overnighting it back. That means you could get a working unit back in less than a week. Not as good as a working unit on day one, but not as bad as some other manufacturers.
There’s lots more information in Porcaro’s post and I encourage you to read it in its entirety.