No problems here so far, after a year. I have the 360 set up vertically with lots of airspace on all sides (except the bottom, but it draws air in from slotted vents near the bottom, so it's fine there too). The back points to the side, toward a wall that's about 2 feet away. It was overheating the wooden panel behind it originally. If I ever get an IR remote for it, I'm going to have to set up a mirror to bounce it off of. Heh.