I wasn't suggesting that Rio shouldn't do anything about it. I expect them to replace your broken unit.

From your "Although, if they can get this kink ironed out, I'll buy another one" I took it to mean that you thought there was some sort of general problem with the Karma meaning that you would be simply returning the unit to Rio rather than getting them to replace it.

I am saying however that whatever Rio do some Karmas will fail early on in their lives. All electronic goods have this problem, the Karma has more of a problem because it has a hard disk (as does the iPod and others).

A proportion of Karmas will fail early in their lives with dead hard drives. Many of the customers that have this happen will think "this is a crappy product if it fails within a few days". Some of them will decide at this point they don't want any more to do with the Karma and ask for their money back.

The law of averages will also mean that some consumers will have an early failure, get a replacement and then have another quick failure. If I was designing a product support strategy I would make sure that such a customer was flagged immediately and given extremely good support, immediately. I would make sure that they were overnighted a replacement unit and when I had their broken unit back (and had confirmed a second failure) I would refund half their purchase price.

Nowadays with the web and all you can get such a bad name from a tiny number of dead-on-arrival or early failures that companies need to start taking measures to address this. I have no idea if Rio have such an approach.
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