Renting Online: Better Than Local Stores?

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posted 12/11/2002 by Dan Clarke
other articles by Dan Clarke
It happens every holiday season: game publishers many more games than you can actually buy or even have the time to play. In one day here at the Gaming Nexus office, 12 games showed up carrying a retail value of over $600 if you bought each one at retail!

Now that the big videogame retailers are putting the kibosh on returning games you’ve opened, where does that leave you? Renting, of course!

Videogames have been available for rent at mainstream video stores since the release of the NES, and even for the Atari before that. Costs have gone up (the local rental chain now charges $5.99 for a one game rental with strict time limits) and the whole hassle of driving all the way across town for a game that may or may not be in stock (good luck finding Vice City or Splinter Cell) really defeats the purpose of having fun and being entertained.

Enter the online videogame rental service. After all, if companies like Netflix, Wal-Mart and Blockbuster can rent DVDs, can’t someone rent videogames the same way?

Fortunately, the answer is yes…two diehard gamers who grew up on the Atari 2600 have developed a new online rental service called Gamefly.com. I was able to speak at length with them in regards to this new venture and it sounds like they may be onto something.

Gamefly co-founders Jung Suh and Sean Spector were frustrated gamers – they noticed that over 1,000 titles had been released for the big 3 platforms this year and there was absolutely no way they could purchase each one – but they sure did want to play them, and thus GameFly was born.


GN: Can you give us some background about where you worked before coming to Gamefly?

Jung: Before I came over here I worked as a producer at Electronic Arts. Even then I knew I wasn’t able to play all the games that EA made – although I sure would have liked to be able to.

GN: Tell us more about the Gamefly service for the people new to online rentals.

Sean: Gamefly is a service that started October 1, 2002, and the response has been fantastic. We carry 95 percent of all games released on the next generation platforms and stockpile literally thousands of games in our warehouse to make sure we have the games you want, when you want them…especially the hot new releases.

For a $21.95 monthly fee Gamefly subscribers can rent as many games as they like with no due dates, late fees or shipping costs. Games are delivered right to your door and we also pay for the return shipping. The only catch is that subscribers can only have two games out at one time. They can play the game to their heart’s content and then return the game to us our purchase it at a pre-owned price (plus a nominal $1.99 shipping charge for the original case & instructions) that’s comparable to a used videogame store.

GN: I noticed on your site you can select either one or two games out at once. Any plans for additional pricing plans with more games out at once?

Jung: Sean and I are focused on our customers. We even handle some of the support ourselves so we stay close to our customers. Although we do not have those pricing plans at this time, it is something we would look at in the future if our customers asked for it.

GN: GameFly is a relatively new service. Back when I first subscribed to a DVD rental service, many titles were always available, but then the rest of the world started signing up for the service and getting a new release was just as difficult online as it was at the video store (the service then adapted and now this problem rarely exists). How is GameFly setup to handle such a surge of subscriptions to keep unhappy renters at a minimum?

Sean: We’ve built this business from day one planning to make games available to a large number of subscribers. We’re able to do that through the combination of our advanced technology plus the experience of our team and our strong financial backing. One of our employees is a former merchandiser of video games. He has a pulse for what’s hot and what’s not and does a great job of forecasting for us what games we need to stockpile for our subscribers. Of course, forecasting isn’t perfect but the human and the computer usually do a very good job together.

GN: Before we go, I want to thank you for taking the time out to chat with us. I have one more question: Right now, there is one primary competitor I can think of that also rents videogames for a monthly fee. What differentiates your company from others?

Sean & Jung (together really loud): AVAILABILITY!

Sean: Our goal is to make sure our subscribers get what they want when they want. Our focus is on the new releases. When you come to our site, we want you to know that Vice City is available and you’ll get it fast. In fact 95% of our subscribers receive their games in 1-3 days.


Thanks to the folks at GameFly for taking the time out to do the interview. For more information, visit their website -- www.gamefly.com.