NZXT accused of ‘predatory scam’ gaming PC rental program

It’s been a few months since NZXT began its Flex subscription service for renting gaming desktop PCs. Even at launch, the proposition was obviously not great in terms of value… but that’s par for the course for any kind of rental, whether it’s an apartment or an armchair.

But YouTube channel GamersNexus conducted a deep investigative dive into the program — and found some shocking results.

In short, GamersNexus accuses NZXT of running a full-on scam, taking advantage of those who can’t afford to buy (or even borrow-and-buy) a full-power gaming PC. The hour-long report documents skewed value propositions that have you paying more than five times the worth of a gaming PC in “small” month-to-month rental charges over five years, for a machine that you never actually own. NZXT Flex is a “subscription,” not a rent-to-own program.

That’s not really surprising for a rental program. That’s how renting works, after all. Back in the day, you could “rent” a VHS from Blockbuster four times in a row, and after a month you’d have spent just as much on rental fees as you would have if you’d just bought the tape outright.

But GamersNexus breaks down just how bad NZXT’s deal is compared to other options for high-priced purchases.

For a $3,000 pre-built gaming PC, GamersNexus calculates that you could get a pay-per-month loan from Affirm Credit (a popular option even for those without easy access to credit cards) with a relatively high 22 percent interest rate and pay only $369 extra after one year. Even if you got a personal loan at 36 percent — the maximum for an under-$10,000 loan in most US states, beyond which you enter “loan shark” territory — you’d pay $6,504, which is more than double the value of the PC.

And then you have NZXT Flex, which, according to GamersNexus, is equivalent to a 103 percent interest rate over five years with a final price of $15,504… for a computer you never own. That’s a terrible deal. But just because it’s a bad value doesn’t necessarily make it a scam.

To elevate those charges, GamersNexus highlights certain “predatory” actions, including: swapping out the parts on Flex rental PCs versus equivalent pre-built packages without adequately adjusting the description (or the PC’s projected performance); writing spurious and unenforceable terms into the rental contract; and running sponsored posts on YouTube and other social media with blatantly false claims, some of which target children as potential customers.

One example of social media marketing stuck out to me. “You could literally get one of these PCs for one month and then win a Fortnite tournament or something, and have enough money to buy your own PC,” says TikTok and Instagram channel BlipTech, clipped in the report.

If you’re an adult, hopefully I don’t have to tell you that spending an exorbitant amount of money to rent hardware in the hopes of winning a paid gaming tournament is a bad idea. But if you’re a child, please read that again: Spending money to rent hardware in the hopes of winning a paid gaming tournament is a bad idea.

The full, exhaustive report — including potential motivations for the company’s change in direction, financial breakdowns from a banker, and an interview with an attorney — is well worth a watch. GamersNexus gives NZXT a backhanded award for its practices, and says it will no longer accept sponsorships or advertising from the company.

Update: On Tuesday, NZXT issued a press release and video addressing the points in GamersNexus’ report, without explicitly mentioning it. “We messed up,” said CEO Johnny Hou, specifically on confusion created by significant part differences between the standard pre-built desktops and Flex desktops with the same product names.

Hou and the press release also acknowledge that ad campaigns created in partnership with influencers were “not factual… calling out ownership when it really is a rental program.” NZXT says its partner campaigns for Flex rentals have all been pulled down. NZXT also categorically denied that it retained user data from PCs, despite that being a possibility in the rental contract as GamersNexus noted, saying that it wipes the hard drive of every rental PC that is returned. The legal language is being adjusted to spell out that NZXT cannot sell customer data.

That said, this response veers pretty close to the standard “non-apology” to me. Neither the press release nor the video address the main point of the GamersNexus report, which is that the Flex program is hugely expensive and a terrible alternative to pay-as-you-go financing programs. Hou spells out several use cases where it might make sense to rent instead of buy (while also saying that the program is not available to anyone under 18).

But none of it actually counters the numbers laid out in the report, that after just one year you’re paying more than the PC is worth, and that after several years you’re paying five or six times what it’s worth, even if the hardware is upgraded. The Flex program would make a lot more sense — albeit still be a bad financial deal versus simply buying on credit — if after a set amount of time you “owned” the PC and didn’t have to return it. You could then keep up a nominal subscription fee to take advantage of the upgrade program.

Once again, rental systems are almost always a bad deal versus a straight purchase or financing. NZXT didn’t invent the idea of charging poor people a big amount of money in small chunks. But I don’t think you can counter negative press if you’re simply dismissing the biggest part of the criticism.