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Microsoft's latest Xbox 360 firmware adds support for a larger capacity DVD format...and Microsoft is replacing old Xbox 360 consoles that can't handle it.
Microsoft’s latest firmware for its Xbox 360 gaming console adds support for the new XGD3 DVD disc format that can support an additional gigabyte of data—which means game developers can pack more content on each disc. However, reports have some older Xbox 360 consoles unable to play games after applying the update—and Microsoft is replacing those consoles with new Xbox 360 Slim units (with a 250 GB hard drive) and a free year of Xbox Live to make up for the hassle.

According to EuroGamer, Microsoft says a “very small number” of older consoles are impacted by the problem, and Microsoft is urging anyone experiencing problems with the new firmware update to contact Xbox support. For users who have their consoles connected to Xbox Live, the company can apparently detect when the firmware update is causing problems, and is pro-actively contacting impacted customers and offering a replacement console. The error apparently produces a unique “disc unreadable” or “disc unsupported” error on the system’s display.

According to some reports, impacted consoles seem to be primarily first-generation Xbox 360 consoles from the system’s introduction back in 2005 and 2006. Ironically, many of these consoles were already replaced by Microsoft: the company was forced to set aside over a billion dollars (and extend the Xbox 360 warranty out to three years) to cover high rates of hardware failure in early Xbox 360 systems.

Some other reports indicate the firmware update also includes new technologies intended to combat piracy.

Maybe if it kills your PS3 Sony will give you a new one like Microsoft just announced for their (annual) screw-up.

If your PS3 dies. You get to pick 1 out of three Sony consoles as free compensation.

PSX
PS2
PSP