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Ruling Confirms Postal Service Discriminated Against GameFly
An anonymous reader writes "It took almost two years, but the US Postal Regulatory Commission just ruled (PDF) that the US Postal Service '...had unduly discriminated against GameFly.' GameFly recently complained that the additional postage was costing them $730,000 per month."
Now that Gamefly has won they can close up shop because everyone directly downloads their games directly from the Nintendo, Sony, or Steam stores now......
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I think, by definition, a summary should give people an idea of what the article is about. The summary doesn't tell me:
1. Who is GameFly and what do they do?
2. What the discrimination entailed? Did it just cost them more money to send postage?
3. If GameFly recently complained, then surely it couldn't have taken 2 years?
So many questions, if only I read TFA...
Is this discrimination against Gamefly or favoritism of Netflix?
It cannot exist without raising fees year to year and dicking people around.
My local postmaster is a totally uncommitted douche who will stand around and yak with a pal while there's a line six deep. I know, because I've gone through that line while he did it and I could hear every word of his entirely personal conversation.
My local carrier has been changed up repeatedly and now I have a couple of them, one is okay, the other is a douche who can't go up and down my driveway without sliding around in a Jeep despite the fact that every FedEx driver and one of my two UPS drivers can make it in their poorly designed box trucks (poor for the country, anyway) without any difficulty.
Finally, about 90% by number or 99% by volume of the mail I get is spam. Do you have any idea how many trees are cut down yearly to produce that shit? And yes, they really are cutting down trees, and yes, a significant percentage of that is not farmed timber, which does not make the best paper. And a truly puzzling percentage of this spam is printed on heavy, glossy paper. I could do without that nonsense. I really have no need whatsoever to receive anything from the USPS.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
Uh... how about someone just download your credit card and, uh... "copy" it to twitter. That's not stealing... uh... right? I don't know why I'm responding, we've seen people making the same rhetorical argument that makes no sense.
Read and remember: Stealing is not someone losing something. Stealing is taking something that a) is not your's or b) you are not permitted to have by the owner. Stealing is a verb, it is a form of the act of "TAKING" not the act of "LOSING". Why do people never understand that? Case in point: Bob "stole" my idea for the project.
Nor does it necessitate of physical object, because you yourself said that your numbers represent physical money. But the numbers are NOT the physical money. If someone robs the bank of the physical money, do you lose money? No, because the bank, not you is robbed. If someone robs your account of your "numbers", does the bank lose the physical money, no, because you, not the bank, has been robbed.
Now, you can argue the semantics all you want. But my point remains. Is it stealing if someone simply copies your credit card information to Twitter? If someone does it, what will you tell the police?
A) Someone stole my credit card information and put it on Twitter!
B) Someone unethically copied my digital data. They didn't steal it, but I want you to prosecute them for... unethical copying!
Uh...really? Because I think that would result in a lower balance in my account. Now, I could be wrong about this (I feel like i have to point out my sarcasm here), but those numbers in my bank account represent physical money that I can withdraw at any time. I'm not saying that everybody should be free to copy games and movies all they want, but that it doesn't liken to the proper definition of theft when I copy the items in question. I don't know why I'm responding to this...we've seen this argument here a zillion times.
I8-D
Why should the USPS be forced to subsidize a business that's unwilling to make simple technical changes that would reduce their cost to process their bulk mail? If you cost them more money you *should* be charged more, especially when you are told what fixes you can make to accommodate them and get the better rates. The postal service is subsidized by the taxpayers and any shortfall from a bulk customer like Gamefly will either be shoulder by us directly through larger appropriations or through rate hikes.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
But they're doing 45 billion in business a year... 1 billion of that is under 3% markup. I don't think I'd call that "overpriced"?
I work for the Department of Redundancy Department.
So if I go look at a Monet and then I set about painting and make a copy of the Monet it is stealing?
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
It seems to be that this entire case, and the ruling, could be used to help explain some of the elements involved in Net Neutrality. Seeing as one of the biggest problems with Net Neutrality has been explaining it well enough for anyone to figure out which parts of it they should be supporting, that could be pretty useful.
so until physical copies of games disappear (which may only be a console generation away)
Games for this generation already run up against the single digit GB/mo cap of satellite broadband. Say your satellite provider limits you to 0.2 GB/day (source: HughesNet.com). Buy one PS3 game as big as a dual layer BD, and the 50 GB download eats up well over half a year of transfer. In some countries of Europe, even wired broadband has a cap smaller than 50 GB/mo. So I don't see physical copies disappearing at least until these caps are increased.
People still use Gamefly? I thought they'd have gone out of business by now because of member hemmoraging, considering they NEVER have anything in stock. I jumped ship a couple of years ago after I couldn't get ANYTHING to show up on time. Sure I understand a new game will have a wait time, but I'd have about 20 games in my queue, and out of those 20, I'd get NUMBER 20 on the list. You'd think they could just go to walmart and get a few more copies or something but no, that would make too much sense.
Then could you give details about the "simple technical changes" that would reduce theft and breakage without increasing postage?
Do you think they would experience $700k in breakage and theft a month?
An article claims that GameFly makes 1.2 million shipments per month. If console games cost $50 each, then $700K a month is 14,000 copies. That equates to a 1.17% difference in theft or breakage. If a flimsier, easier to steal mailer would increase theft and breakage by more than 1.17% of all shipments, go with it. I lack access to the proprietary information on which GameFly made the decision to go with sturdier, harder to steal mailers.
The ruling states that other companies weren't charged under similar circumstances, that's why the ruling is correct.
Your solution could be considered valid, but it's not addressing the problem from the article unless it's also applied to the other companies in similar circumstances. ie Netflix, etc
They decided to revoke the non-machinable surcharge on Gamefly discs, to match what is being done for Netflix and Blockbuster discs. However, I think they should have decided to impose the surcharge on all three. I used to work for the Postal Service, and I can say that there really is additional manual processing required for the DVDs, and that they should probably all be processed as flats (e.g. like magazines) instead of like letters. The biggest problem is the fact that they don't meet the Postal Service's requirements for minimum flexibility, which causes them to not go through the mail sorting machinery properly.
Did you mount a military-grade, variable-focus MASER on an unlicensed artificial intelligence?
Here's the real deal. Mailing a DVD cheaply is hard. There's a huge price differential, about 4x, between the postage for a "flat", such as a DVD in a reasonably sturdy cardboard envelope, and 1 ounce USPS first class letter postage. First class letter postage is only available to mail pieces which meet certain size criteria which allow them to go through automatic sorting machines.
Netflix developed a package which, with DVD inside, weighs under 1 ounce, and sort of meets the criteria for first class letter postage. "Sort of" means that it sometimes jams up or gets broken in the machinery. However, the USPS allowed Netflix to get the first class rate, and then manually pulled most returning Netflix mailers from the mail stream for manual processing. (Returns are the problem - on the outgoing side, Netflix is sending uniform pieces in bulk, pre-sorted, to get the best rate. Returns just come in from mailboxes, unsorted.)
GameFly rents game disks by mail. They tried Netflix type-mailers, but the USPS wouldn't hand-sort their returns, so they tended to get broken going through sorting machines. Worse, USPS employees were stealing the games, in large enough quantities that it mattered. GameFly was using bright orange mailers at the time, and on the advice of the US Postal Inspection Service (the Post Office's cops), they went to a heavier mailer that wasn't prominent enough to be stolen and was handled as a "flat", which is tracked better than a first class item.
So now GameFly's disks were getting through, but at 4x the cost of what Netflix is paying. That's what GameFly was mad about.
The settlement is that there will be two stated rates for mailing DVDs - a 1oz rate (weak packaging) and a 2oz rate (heavier packaging), and the 2oz rate will only be 2x the 1oz rate. This cuts GameFly's postage costs roughly in half, but they're still paying twice what NetFlix pays.
Why do you assume they aren't getting a deal on the games?
Because video game publishers have been including specific Internet-unlockable incentives to buy new rather than rent or buy used in new releases. I don't subscribe to GameFly; have publishers been selling GameFly special "rental editions" the way movie studios have started to with Redbox?
An attention whore like you and the GP AC.
I've read the ruling, kinda prepared to find out that the Ars Technica article had misunderstood or misrepresented something important about the situation, but it doesn't.
Actually, it pretty much says "Netflix made business decisions that made it unsuitable for the carefully negotiated deal Blockbuster and Netflix got, didn't want to prepay the way they did, used heavier mailers, and in general was unwilling to make the USPS job easier like the other companies. The situations are not even remotely comparable. So obviously the USPS should completely alter their system so Gamefly gets the same deal Netflix and Blockbuster worked their ass off to get."
It get there by, as near as I can read it, simply overruling every objection by the postal service and happily ceding every objection Gamefly makes. USPS introduced signed dated letters showing they made these offers to Gamefly, the commission ignored them. Gamefly introduced unsubstantiated evidence, the USPS objected, the commission asked if the USPS could prove they were forged?
The whole thing reads like that. I can only assume the Gamefly attorney is damn sexy or something.
Pug
An Invisible Entity of Vast Power whose existence must be taken on faith alone: Liberal Media