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Gamefly asks PRC to hurry up- postage dispute is eating into its profits

In a letter to Postal Regulatory Chairman Ruth Goldway, Gamefly CEO David Hodess has asked the PRC to expedite its consideration of Gamefly’s appeal against the USPS’s alleged discrimination against the company. Gamefly, which rents game DVDs by mail, claims that the USPS gives preferential treatment to Netflix:

I am writing to you to request that the Commission do what it can to expedite its decision in the GameFly complaint proceeding. GameFly frled this complaint nearly two years ago. Before that, GameFly spent 18 months working with the Postal Service in an attempt to resolve informally the issues on which the complaint was based.

I understand that the Commission has competing demands on its resources. Delay in resolving the case, however, is costly to GameFly. At the company’s current volume of approximately 1.2 million shipments per month, the difference between the two-ounce flats rate of $1.05 that GameFly must pay to avoid automated letter processing for most of its DVD mailers, and the one-ounce letter rate of $0.44 that Netflix pays to avoid automated letter processing of return mailers, amounts to about $730,000. This amount represents more than 100% of GameFly’s monthly net income in 2011.

Respectfully submitted,
David Hodess
President and CEO

  • Vennie

    GameFly quit whining you are making plenty of money. If you don’t like the way USPS treats you go to UPS then you will really have something to whine about.

  • Waste of Money

    Netflix 0.9 oz letter size envelope
    Gamefly 1.6 oz flat size

    What is the problem you moron. You are paying exactly what you should be.

  • hrdcorefan

    At all the offices I have worked at, we dont process the Netflix like a letter. Letters would be processed through DPS. We have segregated them from letter flow and handle them as a Flat to prevent breakage in the DPS machines.

  • zena

    Seriously? Downsize your packaging you idiots. Netflix should be paying as a non-machinable letter because that is what they are. They do not survive the DPCS too easily. The machines either rip the covers off completely or they smash the dvds of at least 10%. We only run them through to get them in order to be delivered to the street they never go through the machines when they are on the way back to netflix.

  • S.Baird

    Gamefly tried to send their games just like netflix when they first started and lost tons of games to breakage in the machines because they weren’t separated out like netflix dvds. They had to add a sleeve to protect them that costs more to mail. They are suing to get the same treatment for their product as as is received by netflix. Everybody’s mail should get the same treatment. So either we make netflix pakage their dvds so the machines won’t eat them or we separate gamefly disks out so they don’t have to pay as much postage.