Right smack in the middle of Microsoft's (Nasdaq: MSFT) 
most important Xbox 360 game launch of the year, some "Halo 3" discs have been scratched before their unlucky owners ever got a chance to play them.
Not all of the scratches resulted in unplayable discs, but the problem is systemic enough that Microsoft is waiving its usual US$20 replacement disc fee so that owners can get new ones shipped to them free.
"Halo 3" is available in three possible packages -- "Halo 3" for $59.99, "Halo 3 Limited Edition" for $69.99, and "Halo 3 Legendary Edition" for $129.99. The problem only affects the Limited Edition, which comes in a special metal case that doesn't always secure the disc correctly, allowing it to shift around inside the case during shipping.
Big Task
Even with a relatively minor percentage of scratched or unplayable discs, "Halo 3" is widely expected to sell 3 million copies within two weeks of its launch, so the high volume could mean that Microsoft will have to deal with thousands of disc returns. All editions of "Halo 3" drummed up a total of 1.5 million pre-sold copies, but Microsoft hasn't broken out more specific sales figures yet.
"Mine had the same problem but the discs worked fine," Rob Enderle, principal analyst of the Enderle Group, told TechNewsWorld.
"It appears most are reporting it isn't hurting the performance 
, but it can make the disks look bad, and Microsoft seems to be addressing the problem," he added. "I think this is a nit myself -- if the discs weren't working it would be a bigger problem, and it appears to result from products getting pounded in shipping, which should have been anticipated, but the cause may be unusual abuse in shipping."
Two Weeks?
The free replacement shipping, however, is only available until Dec. 31, Microsoft said. The cap will likely limit the replacements to discs that were actually scratched during shipping rather than those that picked up scratches in the home. Of course, this means that customers -- who have been eagerly awaiting the release of "Halo 3" for months -- will have to part with their working-but-scratched discs for two weeks while Microsoft ships them a new one.
The packaging problem, Enderle said, may have occurred downstream from the Xbox group. A more generic shipping or packaging department may have caused the problem.
Either way, "It does suggest that companies need to actually test the entire packaging process heavily before shipping in volume," Enderle noted. "This is hardly the first time we've run into this with special packaging -- one of the reasons generic packaging is what it is, is that it is time-tested for this kind of problem."
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