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Effective immediately, Microsoft has extended its warranty coverage for Xbox 360 users who have encountered the 'E74' hardware error code, to three years from the console's purchase date.

Additionally, Microsoft will be issuing refunds to any users who have previously paid for repairs caused by the error.

This new service plan effectively adds the 'E74' error to the extended warranty first offered in July of 2007 for users who have experienced "general hardware failure" errors indicated by the infamous three flashing red lights on the front of the console.

An unnamed Microsoft representative revealed to GamesIndustry.biz that the two symptoms appear to be related.

"After investigating the issue, we have determined that the E74 error message can indicate the general hardware failure that is associated with three flashing red lights error on the console," the representative said.

Though independent research conducted by Jacob Metcalf of 8bitjoystick.com suggests that the error is caused when the "ANA" image scaler chip overheats and fails, the representative we spoke to was unwilling to verify this, stating that the "general hardware failure has no single root cause. As a matter of policy, we do not comment on internal component updates or changes."

First reported by online users shortly after the Xbox 360 console launch in late 2005, the E74 error has seen an increased amount of media coverage over the past month, with gaming enthusiast blog Joystiq reporting a dramatically increased number of email complaints from its readers starting in March.

While Microsoft maintains that a "very small percentage" of its customers have complained of the error, the Redmond, Washington-based company told us that "there has been a small increase in inquiries related to E74 in recent weeks coinciding with the growth in media coverage related to the E74 error message."

According to Microsoft Help and Support, refunds will be issued to those who have paid for repairs related to the E74 error "within 4-12 weeks."

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