updated 03:05 pm EDT, Wed May 18, 2011
Microsoft to replace Xboxes that can't read XGD3
Not all existing Xbox 360 consoles are capable of reading Microsoft's new XGD3-format discs, some users are reporting ahead of Microsoft's spring update due out tomorrow. As such, Microsoft is identifying these consoles and offering their owners free replacement consoles. One such case is that of gamer Avery Penn, who shared his experience.
The new discs have an extra 1GB of space, allowing developers to stuff more content into their games. The "very small number of Xbox 360 owners" who can't play retail game discs are being offered the current-generation 250GB Xbox 360 free of charge from Microsoft, as seen in the letter below. They do have to send in their current consoles, however, and upon doing so receive a code for a free year of an Xbox Live Gold subscription.
Microsoft officially confirmed the replacement program over Twitter. The system update will also bring with it updated PayPal support to new international markets. [via WinRumors]