I've been using Gamefly for about five months now. It used to be that I would just buy the games I wanted, but with XBOX 360 games costing nearly $70 a piece, it's starting to be cost prohibitive to play as many of the new games coming out that I would like. A while back I decided I would stop buying games (unless they had a great multiplayer side that I would replay a lot), and I decided to try out Gamefly.
My first few months with the service weren't so great. Gamefly is basically Netflix for video games, except they're missing two of Netflix's greatest features: (1) A huge library of titles, and thousands of copies of each, and (2) An extremely fast turnaround time for shipping. With Netflix, you can easily watch six movies a month on the three-out-at-a-time plan, because they've always got everything in stock and it gets to you within a day. Not so much with Gamefly.
Every title that comes out at Gamefly is immediately set to "short wait" status. But short wait on Gamefly usually means "long wait." It can take up to a month before a newly released game is available for rent, and that's a really serious problem. And, on top of that, it takes Gamefly a long time to send titles out, and for them to get to me. On average, it will take Gamefly two business days to send a title, and it takes three business days to arrive. When I send it back, it takes them three to five business days to mark it as received. That means, with the two-out-at-a-time plan, I can maybe get in three rentals a month, and only if I don't want new games.
So why do it? Well, it's only $20 a month. If I pay $20 a month and get to play two games, I've saved anywhere from $100-$120, considering the cost of two XBOX 360 games.
The good news is, Gamefly just introduced a new feature called "FastReturn". They've apparently partnered with the US Postal service, and now the post office will scan the return and send a confirmation to Gamefly right away, and Gamefly immediately sends out a new game. That's excellent news for people like me, who live in NYC (Gamefly is in LA) and usually have to wait four to five days for the game to get returned. This is a feature even Netflix could benefit from.
One other benefit to Gamefly is the ability to just keep a game you've got out. You can just pay for it (usually cheaper than full-price) and then in a few days you'll receive the case in the mail. It's convenient for lazy folks like myself. And since you get occasional gift certificates for being a member for a certain amount of time, you can eventually save money on buying games this way, and you'll get to play them before you do.
With the addition of FastReturn, the only thing really hurting them is stock. I'm sure it's expensive to build a massive stock of games, but at this point it's probably the only thing keeping Gamefly from being more popular. In the mean time, when people ask me if I've played [new game], I'm the losery guy who says no. But three months from now, I'd love to talk about it because it will be on its way to my house. Probably.