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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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RE: That's what you get for...
By Hyperion1400 on 4/27/2009 1:19:06 AM , Rating: -1
They aren't government funded, and they aren't billions of dollars in debt. All of their costs are covered by postage and shipping fees. So I say, as long as they cover costs, they can hire as many employees as they want to stand in the back and pick their ass AND pay them what ever outrageous wage they want for doing it(I think it's around $19/hr).

However, such a huge failure rate(I'm sorry, 1 percent is inexcusable) is incompetent and good on Gamefly for calling them out.(Remind me again why I have to pay them EXTRA(shipping insurance) to insure that my package actually get there?!?)

RE: That's what you get for...
By jimbojimbo on 4/27/2009 3:13:40 AM , Rating: 3
That's like complaining after you've mailed a box of wine glasses in an envelope and it arrived broken. Poor packaging is poor packaging. Instead of complaining they should work with the USPS to see what type of packaging would be ideal.

RE: That's what you get for...
By OAKside24 on 4/27/2009 10:46:17 AM , Rating: 2
Not really. Only 1% of the discs break (bad packaging: improbable), but your example is quite opposite in that MOST of your wine glasses would break (bad packaging: probable).

Last time I checked, GameFly packaged the discs inside a sleeve AND cardboard piece. Better packaging than Netflix and Blockbuster (which I attributed to extra safety with expensive game discs), but apparently the 1% breakage is higher and/or unacceptable.

RE: That's what you get for...
By wempa on 4/27/2009 1:24:37 PM , Rating: 2
Yes, you're right. They do use (or at least DID use) a cardboard insert as well. The game is secured in the middle between 2 cardboard sides. The envelope is not big enough for the game to slide out of it. I wonder how the heck these games are getting broken then. You'd have to use a lot of force to bend the cardboard and break the disc. Very weird.

RE: That's what you get for...
By MadMan007 on 4/27/2009 8:43:06 AM , Rating: 2
Shipping insurance does not ensure your package arrives any more than auro insurance ensures you won't have an accident. You need to review the purpose of and liability coverage of shipping insurance.

"Google fired a shot heard 'round the world, and now a second American company has answered the call to defend the rights of the Chinese people." -- Rep. Christopher H. Smith (R-N.J.)

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