The Problem: Microsoft's New Disc Standard

The issue appears to revolve around Microsoft's new XGD3 disc standard, which adds 1GB of useable space to the disc for developers. For some reason, the disc drives in a small number of Xbox 360s are unable to read game discs after being upgraded.

The problem was discovered during beta testing of the new firmware, and one of those testers shared the letter they received from Microsoft with Kotaku. Microsoft itself confirmed the legitimacy of the letter on Wednesday.

Microsoft is able to detect the problem through Xbox Live, and can determine who may need a replacement. It's not a bad deal, either: owners of faulty consoles will receive a brand-new 250GB Xbox 360 S, along with a free year of Xbox Live.

New Anti-Piracy Measures Added