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Inside Move: Downloads overload Xbox

Co. plans to offer refunds for those who encountered problems.

Movie and TV downloads made their way to videogame systems for the first time over the holiday, but not without some major headaches.

On the Wednesday before Thanksgiving, Microsoft launched its service offering downloads of movies and TV shows for the Xbox 360 through its Xbox Live Internet service. It wasn’t long, however, before message boards were lighting up with complaints of missing films, ultra-slow download speeds and multiple charges for one purchase.

Tech giant responded quickly with posts on its public message boards on Thanksgiving Day letting users know it was aware of and working on the problem. By Sunday, Microsoft reported that “download speeds for most users should be significantly improved across the board,” and online complaints seemed to disappear.

Company plans to offer refunds or “make-goods” for those who encountered problems.

Warner Bros and Paramount are offering film rentals via Xbox Live, while CBS, Turner and MTV Networks are selling episodes of TV shows.

In a post on his blog Thanksgiving Day, Xbox Live director of programming Larry Hryb blamed the problems on “the extremely high number of downloads from the Video Marketplace service over the past 24 hours.”

Insiders said the company was hit with surprisingly big demand on launch day, particularly for some high-definition content from WB and CBS (HD takes up a huge amount of bandwidth). Microsoft likely had a tough time estimating how much demand there would be since movie downloads have never been available through a videogame console before.

It remains to be seen how much of the interest was day one curiosity and how much it indicates that Xbox Live will be more of a success than Web sites like CinemaNow and Amazon.com, where demand for movie downloads has been light.

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