Microsoft has extended the Manufacturer's Warranty on the Xbox360 to three years for any problems regarding the "Ring of Death" (three red lights).

This applies globally, for all existing owners and all new owners.

Xbox360 owners who have previously paid for an out-of-warranty repair will receive a refund.

For all faults other than the dreaded "Ring of Death", the warranty remains at 1 year as standard.

Important links:

"Xbox 360 Warranty Coverage Expanded"

"Open letter from Peter Moore"

"Expanded Xbox 360 Warranty Coverage FAQ"

And a BBC News story - "MS facing $1bn Xbox bill"