Video games are expensive--more so in Australia than in US and European markets, given our geographic isolation, landmass, and relatively small population compared to other territories. All these factors add to the high cost of distributing games Down Under--something publishers say they cannot fix--leading to the oft-bemoaned fact that Aussie gamers really do pay more to play. So what's to be done about it?
Shane Horvath
One answer is game rental. Aussie game rental sites such as Game Guys and Rent-A-Game Australia have been servicing the market for a while now, and another player has joined their ranks. Newcomer GetGaming launched earlier this year, with Sydney-sider Shane Horvath at the helm. Horvath set up GetGaming after he discovered the similar GameFly service on a trip to the US. GameSpot AU sat down with Horvath to get the lowdown on online game rentals in Australia, how strong the market is, and what challenges the service will face in the future.
GameSpot AU: What convinced you to start GetGaming?
Shane Horvath: My last job was CIO for Coates Hire, Australia’s largest equipment hire company. For a number of years prior to this, however, I was always looking for a way out of the corporate rat race and it wasn’t until I resigned, got married, and went travelling that I finally had time to gain clarity.
When I came across GameFly in the US, I knew it was an opportunity. I did a little bit of investigating and soon came to the realisation that there was a real gap in the Aussie market for something similar. I’ve always been a gamer, and I can empathise with the frustration of wasting a lot of hard-earned cash on a game that didn’t live up to the hype. I remember wishing that a service like this existed, and I’m sure a lot of other gamers have too.
GS AU: Why do you think there is a lack of services like this in Australia?
SH: There have been a few companies that have started up and quite a few more that have shut down. What I gather is that some of the people who start these businesses think it’s a good way to feed their own gaming habits and often don't think of the details that are involved in running an enterprise like this. It's very important to us that our members are always getting the best service and that we are always keeping them up to date with the latest releases. The reality is that rental services--be it equipment or games--are not an easy market unless you have previous experience. It's a hard slog to get the most for your customers and the most out of your stock, and it’s an easy market to lose money and reputation in, especially when you are a startup.
GS AU: Why do you think the US model has been so successful?
SH: The US model has been around for a long time. GameFly started in 2002 and, like us, started small. It took them a long time to find the best way of delivering their products. Over the years, they kept on growing and now they have found a great market. Game rental simply makes sense. It gives the consumer a much more cost effective alternative to buying and trading games. It also gives them the opportunity to play games they would not have ordinarily played.
GS AU: How does GetGaming Australia work? Run us through the process.
SH: GetGaming follows a very similar model to that of the online DVD rental companies such as Quickflix and BigPond Movies. The process is straightforward--customers sign up to whichever plan that suits their needs. They can pick either one game at a time for $22.95 per month, or two games at a time for $32.95 per month, both with unlimited exchanges. They also have the option of choosing the casual rental option where they can select a game, pay $11.95, and have it sent out to them with a 16-day return window.
Once customers have signed up, they can browse our game library and add games to a rental queue. They will then receive the games in their queue in order of preference, which can be changed at any time. We process game rentals every weekday, so if a member joins before 2 p.m. on any day of the week, their first game is sent out that day. We always try to fulfill our customers’ top three preferences.
Each game is sent out via Australia Post and is sent with a return reply-paid envelope; once customers are finished, they simply post it back. We also offer an "express return" feature to reduce the waiting time for the next game in a customer’s particular queue. We have no late fees or due dates on our "Unlimited 1 or 2" game plans.
Fortunately, game loss and damage is a rare occurrence. We do have the right, as per our terms and conditions, to charge for lost or damaged games; however, we have not had the need to do so to date. We review each case separately, including the customer’s history, when making a call on charging.
We also sell new and ex-rental games at competitive prices.
GS AU: How many games do you currently have in your database?
SH: Currently we have just over 1,300 titles and growing daily. We cater for all consoles, and we have multiple copies of some titles to cater for demand. We are always analysing our customers' rental queues and refreshing and adding new games in accordance with what they want. We buy our games from a wholesaler in Queensland named All Interactive Entertainment.
GS AU: You said you self-funded the project yourself. Was it a costly venture? Do you think you're taking a risk?
SH: Setting up an enterprise like this is not cheap, especially when you have to buy stock. Games in Australia are expensive, even at a wholesaler price. We are definitely taking a risk, but it is rewarding--I get far more satisfaction out of this than my previous job. We are building something and watching it grow, and it’s fun. Plus, I get to play a stack of games!
GS AU: How is business going so far? What has the take-up in Australia been like?
SH: It’s been slow, but we are growing at a consistent rate. This is not at the speed at which I would like it to be, but I expected things to be slow at first. The thing with online game rental is that we are changing the way the consumer buys, and as with any consumer change, things will take time. It took Quickflix, the Aussie DVD online rental company, six months to reach 500 customers back when they began in 2005. Not long after that they hit 2,000 customers, and now they get something like 10,000 new customers every three weeks. In saying that, a lot more people watch DVDs than play games, so we expect it to be a little slower.
GS AU: Are you looking into marketing strategies to increase business?
SH: Yes, we have done a number of things, some online, some print, a few competitions--it all helps but we are always looking at things we can try.
GetGaming can be found here. A New Zealand service will launch by mid-October, found here.