Definitely need a replacement for that unit. Good thing you got the ball rolling already.
I haven't had a dead LED on a Kindle device but I had a huge problem with the Paperwhite 2 when it came out. On the first two units I had there was something wrong with one of the film layers that the light disperses through that caused "sparkling" and areas where the light just shone through like a flashlight through a piece of paper with a pinhole in it. This made reading at night hilarious.
Super annoying. Super bad QC. And then I didn't end up keeping a good unit when I got it because the PW screen is so dang fuzzy and indistinct even at the later 300 PPI that I just couldn't read comfortably on it.
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