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GameFly and USPS are at odds, and could go to court

Video game rental service GameFly and the United States Postal Service (USPS) could be headed to court over accusations that USPS breaks thousands of game discs each year, and offers preferential treatment to Netflix and Blockbuster.

GameFly claims it sends 590,000 games to its subscribers each month and receives 510,000 of the games back.  Around one or two percent of the total games sent each month are reportedly broken by USPS.

Ars Technica estimates that GameFly could be losing up to $295,000 per month in broken video games, if each game costs $50 to replace and one percent of all games each month are broken.

The video game rental service filed an official complaint with the Postal Regulatory Commission, accusing USPS of discriminating against the company.

To help reduce the number of games damaged, GameFly wants USPS to manually sort all of the games -- rather than use the automated sorting system -- which inadvertently damages CDs.

GameFly also believes USPS favors Netflix and Blockbuster over its service, as both companies send out a larger amount of discs.

"Until recently, none of the larger-volume DVD rental companies offered video games," said GameFly in the complaint.  "On February 11, 2009, however, Blockbuster, which hitherto had offered only movie DVDs (which GameFly does not offer), announced that Blockbuster was expanding its DVD rental service to include video games in the second quarter of 2009. As a result of this initiative, GameFly now faces direct competition from a rival that is larger and longer established — and which, because of the preferential treatment given by the Postal Service, enjoys a substantial cost advantage in the distribution of its DVDs to consumers.”

The Postal Regulatory Commission has given USPS 30 days to file a response, and the PRC will decide whether to have a hearing or dismiss the case within 90 days.

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If they're that concerned...
By Noya on 4/26/2009 5:05:15 PM , Rating: 3
If they're that concerned with broken discs they should design and implement a super thin clamshell case for shipping.

RE: If they're that concerned...
By foolsgambit11 on 4/26/2009 5:41:39 PM , Rating: 5
They tried little thick sleeves for the discs; that didn't work. Maybe a hard plastic holder would work better, but why increase your operating costs because what is essentially a contractor failed to provide the service you contracted them for? Especially when you know they are capable of providing the service better, because they do for your competitor.

It makes better business sense to file a complaint (and possibly sue) to petition for equal treatment.

RE: If they're that concerned...
By vapore0n on 4/26/09, Rating: -1
RE: If they're that concerned...
By bodar on 4/26/2009 8:02:36 PM , Rating: 5
"On February 11, 2009, however, Blockbuster, which hitherto had offered only movie DVDs (which GameFly does not offer), announced that Blockbuster was expanding its DVD rental service to include video games in the second quarter of 2009.

Someone didn't RTFA...

RE: If they're that concerned...
By RandallMoore on 4/26/2009 10:52:46 PM , Rating: 2
Ya know, just to add my 2 cents here... I love that we now live in a society that when someone makes up an acronym on the spot that involves cursing/violence/irony, we can immediately understand exactly what it is. :D RTFA; lmao.

It's the small things in life that matter...

RE: If they're that concerned...
By Flail on 4/26/2009 11:01:43 PM , Rating: 1
well, it was kind of easy to understand that one at least. The guy he was responding to didn't read the article, so it was something along the lines of "Read the Fucking article"

RE: If they're that concerned...
By Sanity on 4/26/09, Rating: 0
By RandallMoore on 4/27/2009 9:17:39 AM , Rating: 1
I think you are about the only one that understood my meaning. Of course I knew that this acronym already existed; in fact, it would be hard to believe that there is a phrase that hasn't been acronymized (lol) yet!

Some of you guys out there are an absolute buzz kill, geez.

RE: If they're that concerned...
By MozeeToby on 4/27/2009 1:43:12 AM , Rating: 4
Hate to say it, but he hardly made up the acronym on the spot. RTFM (Read the F-ing Manual) has been used in Linux circles for a couple of decades now and RTFA has been in use on a lot of forums (especially Slashdot, where its an on running meme).

RE: If they're that concerned...
By Meinolf on 4/27/09, Rating: 0
RE: If they're that concerned...
By afkrotch on 4/27/2009 10:58:50 AM , Rating: 2
I'm sure that's the case. They should ask Blockbuster and Netflix how many discs they send out get broken. Course, a dvd movie/blu-ray movie is still around 1/2 the price of a game.

RE: If they're that concerned...
By mcnabney on 4/27/2009 11:48:06 PM , Rating: 2
I have used Netflix for about 9 months and have received three disks that arrived snapped in two. So about 3-5% DOA for me. Scratches are worse.

RE: If they're that concerned...
By grandpope on 4/28/2009 11:15:49 AM , Rating: 2
In that case, your dad should be on the lookout for a subpoena to testify in this case!

RE: If they're that concerned...
By energy1man on 4/26/2009 10:09:02 PM , Rating: 4
Link to an article about cracked blu ray disks from Netflix by Wired about a week ago.
One of the postulated causes is automated sorting machines at the post office. While Gamefly may be claiming preferential treatment for blockbuster and netflick, this would suggest otherwise.

RE: If they're that concerned...
By bhieb on 4/27/2009 9:30:38 AM , Rating: 1
Agreed. I don't see where the problem is here. They basically pay for the lowest cost bulk rate that the USPS offers. It is not insured so you are going to have mistakes. If they want better service then pay for it. When you consider that for ~$.40 someone will come to you pick up a product and deliver it to any other person in the lower 48 within a few days, it is pretty astonishing. 1-2% failure rate is acceptable.

And the argument that competitors are getting special treatment, of course they are. The USPS has special bulk rates for bulk customers. The more you send the more you save. Each contract is negociated seperately so if Gamefly does not like the deal go get another one somewhere else. Oh wait they probably can't so quit complaining.

RE: If they're that concerned...
By foolsgambit11 on 4/27/2009 8:46:13 PM , Rating: 2
You need to beef up your critical reading skills.

1. That article specifically refers to Blu-Ray discs because the discs are different than DVD in their makeup, making them more liable to be damaged.
2. Netflix claims their damaged Blu-Ray discs amount to "a fraction of a percent" of total BD rentals, while GameFly's DVD damages are allegedly 1 to 2 percent. A big difference in a low-margin business.

RE: If they're that concerned...
By energy1man on 4/27/2009 9:39:37 PM , Rating: 2
Well the critical aspect would be that the post office is machine processing the netflix packages, not giving them special treatment. Yes the blu ray may be more prone to damage, apparently the damage to both regular and blu ray disks is something netflix is willing to live with with as a cost of doing business, as they don't want to redesign their packaging due to the associated cost. For all we know it may be gamefly shipping process, before it gets to the post office that is daming the disks, as this was also mentioned as a possible cause of the damage to netflix disks

RE: If they're that concerned...
By JustKidding on 4/26/2009 10:32:19 PM , Rating: 2
This sounds like someone's looking for a scapegoat. The Gamefly disks are handled in exactly the same manner and in the same bins and with the same equipment as both Netflix and Blockbuster, who seem happy with the USPS and continue to do business with them. An alternate explanation might be that the customers are accidentally breaking them and rather than pay for damaging the disks, they put them in the envelopes to be mailed so the post office can take the blame. I know that the kids in my family don't always treat the disks very carefully. Also if a small percentage of breakage (regardless of the reason) is a problem they should either get better packaging or use an alternate method of delivery or an alternate carrier. (if they used FedEx they might have to raise their prices just a bit...:P)

RE: If they're that concerned...
By mmatis on 4/26/2009 10:37:27 PM , Rating: 2
Look for... the Union label...

RE: If they're that concerned...
By MadMan007 on 4/27/2009 8:34:43 AM , Rating: 2
It takes a pretty good amount of force to break a disk so breaking them by accident is unlikely - you have to be more than 'not careful.' Another problem I can see for Gamefly is the disks cost ~3x what a movie does. If it's such an issue they should opt for some type of insurance if opssible depending upon how the numbers work out. And from what I gatjher the complaint is that the disks are not handled in the exact same way.

RE: If they're that concerned...
By bhieb on 4/27/2009 9:33:32 AM , Rating: 2
Still their business model, if they want an insured service then pay for one. Bulk US mail is not insured so a 1-2% loss is pretty good I'd say.

RE: If they're that concerned...
By AnnihilatorX on 4/27/2009 7:53:07 AM , Rating: 2
The LOVEFiLM company in UK which I am a customer of has this patented plastic soft rubber case (it even says it's patent pendinng)

I forgot what the material is, but it's extremely scratch resistant.

RE: If they're that concerned...
By afkrotch on 4/27/2009 11:03:23 AM , Rating: 1
You mean like the cases that the dvd movies, blu-ray movies, or games come in when you purcahse them?

“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads

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