Microsoft is set to replace any old Xbox 360 consoles for free that are not compatible with the upcoming firmware upgrade.
 
The company has sent out emails to Xbox gamers who own incompatible Xbox 360s, advising them that they can request a brand new Xbox 360 S for free. These users will also receive a year of Xbox Live Gold.
 
The new firmware will include support for an updated Xbox 360 disc format, and Microsoft has confirmed that some older Xbox 360 models will need to be replaced, as they are not compatible with the new format.
 
Talking to news site Eurogamer, a Microsoft spokeperson said, “Following a recent update to our system software, we have become aware of an issue that is preventing a very small number of Xbox 360 owners from playing retail game discs.”
 
“This issue manifests itself a as a unique ‘disc unreadable’ or ‘disc unsupported’ error on the screen. We are also able to detect this issue over Xbox Live and are proactively reaching out to customers that may be impacted to replace their console.”
 
It’s believed that the disc format update is related to Microsoft’s efforts to combat piracy on the system. A recent internet traffic study from TorrentFreak suggests the most popular Xbox 360 titles were downloaded illegally over a million times in 2010.

Source: Gamasutra