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Gamers Nexus Investigates NZXT's "Flex" Computer Rental Program
AI Transcript[edit | edit source]
Today, we're investigating NZXT's shady and manipulative PC rental practices. Because of this investigation, we've decided to terminate a $23,000 ad campaign that NZXT had queued up for quarter four, and NZXT has been notified, uh, now.
This is a rental computer, and NZXT's rental program belongs somewhere behind me. We ran the numbers. Over five years, one of their computers at $259 per month rental would cost you approximately $15,540 for a little over $2,000 worth of parts, and with zero ownership. For the same price, you could buy seven equivalent pre-builds in those five years. But it's not just a bad deal. NZXT's predatory program silently swaps parts between systems that share the same name when moving from purchase, which often has better components, to rental. We think they're hoping that people don't notice the downgrade, and theirperformance benchmark is not as good as it used to be. So we're going to have to wait and see.
These parts are a misrepresentation and a lie. They have two different GPUs in two different systems with the same name for the system that have identical performance, even though the GPUs should be 15% at most different from each other. One month after we rented a PC from them, they jacked up the price on us by another $96 per year. When we asked to cancel the subscription, they sent us a link that went to a 404 page that didn't work. They're now offering what they call a free monitor, keyboard, and mouse for $0 per month. If you want to get a free monitor, rent a PC. Except in connection with that deal, they increased the price by another $10 per month or $120 per year. Silently. All of this screams scam, and NZXT's own ad partners say that it actually makes kind of sense. They have zero strings attached, but no strings attached, no strings attached, no strings attached, and no commitment. Except there are commitments, lots of them. This is a direct quote from the subscription agreement. You, grant operator of the business, a non-revocable PC. You, grant operator of the business, a non-revocable PC.
You, grant operator of the business, a non-revocable PC. You, grant operator of the business, a non-revocable perpetual non-exclusive worldwide license to use and distribute, however operator sees fit, any and all images, video correspondence, audio recordings, or other data and information. Is there a good reason for that that you can think of? A good reason for the business or for the consumer? For the business. For the business, it's to sell your data. Okay, all right. But if it's on the hard drive and you return it to them, you've provided it to them, and it's pursuant to this agreement. And it's in connection with the service. It's in connection with the service.
And that's not the only NZXT advertising lie. Luckily, not only did NZXT send us out their Player 3 Prime to help finish out the gaming house, but they gave us a way to finish out our six PC setups without spending $18,000. You can now own Endgame on a PC starting at $59 a month with NZXT's new subscription flag. You might've missed it, so let's just roll that back. You can now own Endgame. You cannot own this computer. NZXT's own rental program agreement makes that extremely clear. It is not something that can be owned, but that's what he said.
The subscription is not a rent-to-own program. At no point will subscriber own the rental devices or other services provided under this subscription, even if subscriber payments aggregate to more than the collective retail price for all services. As for who the customer is, NZXT's flex rental program somehow gets even more duplicitous and disgusting when you realize it seems to prey upon mostly broke, vulnerable people at risk of debt traps and children. Interesting.
Roll 212. Switching from console to PC has never been a cheap date, which always made convincing your parents or wife to buy one a difficult task. So that's a no. Thanks. Now I know what it feels like to be living in hell. And if you think about it, Carter PCs did make a video about it.
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. Now I'm not saying that you should do that because winning a Fortnite tournament can be pretty difficult. I'm not going to lie, but who knows? Maybe some of you guys are underground. I'm not going to lie. I'm not going to lie. I'm not going to lie. I'm not going to lie. I'm not going to lie. I'm not going to lie. I'm not going to lie. I'm not going to lie.
And this is the exact pure gamba brain rot that NZXT is targeting with its rental program. NZXT has become so predatory that we researched illegal payday loans. Hey, I was calling about the check cashing loans. We don't do loans anymore. So you don't do the payday? No. I can give you a phone number if you want. Which the Justice Center says carry an average APR of 365% or about 1% per day if we planned to rent the PC.
For at least three years, it would be cheaper to take an illegal and possibly mob-backed loan for 175 days instead and then own the computer at the end of it, assuming no kneecaps
are busted in the process. Let's, uh, let's go somewhere a little safer to actually film the computer. Context is important.
NZXT is a computer component manufacturer, and it's huge. NZXT's rental program goes far beyond just a badly-priced pre-built PC. This, we think, is actually the mark of the beginning of the end. It's the beginning of PC ownership, if it is allowed to propagate, and if it finds success. It's a continuation of You'll Own Nothing.
As we tumble ever downward into our dystopian future, other companies will be looking on as they, too, realize that they can get rid of aging inventory with potentially predatory policies and profit from it. Corsair, for example, would probably be the first to follow, but you need to understand just how huge NZXT is to appreciate. We'll work backwards. In 2021, we called NZXT out for selling a fire-hazard computer case that featured a design flaw, which could easily cause the case to ignite in a spectacular fashion, given the right set of specific conditions.
Fire. Get that. Oh, jeez.
NZXT dragged its feet on a response for months. And after saying nothing in that time, or at least nothing of value, eventually it sent out a hack. A half-assed workaround of plastic washers that fixed nothing, and then it wiped its hands clean. Dissatisfied with this, and concerned about people's houses potentially burning down, we contacted the US government's Consumer Product Safety Commission. The commission took our research and immediately applied pressure to NZXT, which resulted in a satisfactory fix that we covered later. Although they sort of bait-and-switched that one, too, in our opinions, as we covered previously. Anyway, this coverage resulted in government notices posted and recalls. You can find them on websites in the UK, USA, and multiple of its states, Canada, Australia, and others.
In December of 2021, NZXT took on a $100 million investment from Francisco Partners. Francisco Partners is the same company that invested around $75 million into Corsair in 2013, later flipping it to Eagle Tree Capital for $525 million. This led to Corsair going public, and we all know how that turned out. So big investors and venture capitalists are looking for a repeat of Corsair in NZXT. As a consumer, you'd look at the downfall of Corsair's quality and be concerned. As an investor, you'd look at half a billion dollars and be very excited. NZXT occupies the top three sellers for cases and coolers on Amazon. So NZXT is not a small company, and that $100 million investment they got somewhat recently might explain some of its more vicious anti-consumer practices it's been deploying.
In our opinion, NZXT has become unrecognizable from the NZXT of the past. It's taken on big money, and it's making big money moves that are often anti-consumer. The company has become motivated by greed. Sources informed at Gamers Nexus that NZXT is sitting on millions and millions of dollars of stagnant inventory. This is a familiar story from earlier this year, and we don't need to look far to prove the concept.
In January and February of this year, we received tips from multiple people in the industry now former NZXT employees who noted that the company was laying off its entire PC building
division and beginning to outsource the work. Gamers Nexus obtained a screenshot of CEO Johnny Ho's message firing the staff, which states, quote, "Today, I'm sharing a strategic change in support of NZXT's growth and the community we serve."
To fire you all. Sorry, I had my, uh, my corpo speak translator on. Let's just turn that off.
"We have made the strategic decision to outsource our U.S. production work. We'll be vacating our warehouse space in California by the end of March 2024. Our outsourced partner will provide the expertise, efficiency, and scalability required for our next phase of growth, at a significant cost savings."
I'd just like to add that, one, this is a message sent to people being fired, so not the best phrasing, and, two, it's very sad to see employees react with crying cats, 16 crying ducks, 5 salutes, 4 hugs, and 32 cats hugging hearts.
As for what led to this? We found out by speaking to the CEO. Speaking with NZXT's distribution partners, retailers, and competitors. The company reportedly lost millions of dollars on its peripheral business specifically. This oversupply might point to why NZXT's scrambling to put together whatever old computers they can as they try to generate cash flow off the back of aging inventory, and it might help explain why they're bait-and-switching models with older components that would be harder to sell as soon as it's turned into a subscription, rather than the pre-built purchase option. And that brings us to the first piece of our deeper investigation into the rental program, which is the bait-and-switch. This is the NZXT Flex subscription gaming computer.
The NZXT Flex rental program targets people who don't have the means to buy a PC with cash or with credit. And then it proceeds to rip them off. Every single month until they realize that they're getting ripped off. The testimonials, whether they're real or fabricated, paint a clear picture with statements like quote, the subscription program has truly been a godsend for me.
I am unable to cover the full cost of a PC up front. Yes, a godsend. The gods themselves came down and bestowed upon us a gaming computer to play video games on and so we did the only logical thing. We subscribed to a gift from the gods. An NZXT Flex. A Flex gaming computer.
Put that on the testimonials page. Just cut out all the other stuff I'm gonna say. The terms are pick the tier, pay one time shipping plus the monthly fee, get shipped a PC, use it as your own but it's not, and then send it back when you get tired of paying. Or after two years, NZXT says it'll swap the PC out with an updated model and you can continue paying. Now in theory, that would be the same rate. But they've already increased ours and they did so one month after we rented it.
Cool. But it increased again. While we were writing this story, NZXT upped the price of this model to $130 a month and simultaneously launched a Black Friday deal claiming that you get free components at no cost even though they literally just increased the price by $10 per month around the same time.
They added a quote-unquote sale for Black Friday which involves getting peripherals which sound like you get and own them but that's not true either. It's just another rental that they claim is worth $30 a month in value. It includes a subpar $11 a month keyboard and mouse pad that you have to hold on to for the duration of the rental, supposedly for $0 per month even though right before putting the sale up, they increased the price by $10 per month which presumably is to cover the cost of these stagnant accessories.
And they've marketed these for any player PC which then if you look at the smaller words under the big words isn't even true. NZXT also keeps changing the specs of their consoles. They've also changed the price of their consoles. They've also changed the price of their consoles. NZXT looks past the luxury of the new devices and has a single, one-this winning back, two apparently can't really stand a good deal anymore.
Unfortunately when writing this the PlayStation 3 prime non-rental, purchasable pre built system has the RTX 4090 on it, whereas the rental version of the exact same PC model only had a 4080 Super. The difference between these companions is, over 30%, and seems so misleading to us that it can amount to fraud. During the time we were writing this piece NZXT has changed the specs 4 times, yet it keeps up to date. The Player 3 Prime now is back down to a 4080 Super in the purchasable model from a 4090 just hours prior. But wait, they did it again.
During the time we were editing the writing for the editing that we had to rewrite because they changed the change, they changed it again. Now there's a Player PC 4090 edition, which is the same spec as the original Player 3 Prime that had a 4090 that was changed to a 4080 Super, except the Player PC 4090 edition is $3,999 and it says Black Friday sale, fire emoji, fire emoji, which is $50 more expensive than it was a few days ago. The Player 3 is not the only one they play bait-and-switch games with.
NZXT's baiting all over the place.
If you land on the Player 2 pre-built for purchase and you decide that $1,600 is too much for you and decide maybe you'll rent it instead, then clicking on subscribe gets us to $129 per month, which was $119. $119. A few days ago and $117 for us before that and $109 before that. You then decide that you can afford $129 per month, but not the $1,600. So this is doable and it's for the PC of the same exact model name that you were just on for the pre-built purchase, except the rental has a Ryzen 5 5600X from 2020, DDR4-3200, and an RTX 4070. But the original pre-built PC of the exact same name has up to 20% better performance, with an R5 7600X from 2022 and DDR5 5200, which is stupid for a different reason entirely.
But there's more. They changed the liquid cooler from a 240ml CLC to a 120mm liquid cooler in the rental, and the H6 Flow is substituted with a cheaper and worse H5 Elite in the rental. If you then click on the Player 2 Prime for $159 per month, it has a 4070 Ti Super and a 7700X. It shows $159 per month and $129 per month, both selected, which should open a singular. It contains a 7700X and a 4070 Ti Super, but then clicking the Buy button at the top switches us back to the Player 2 Non-Prime, which is confusing at best, and then re-clicking the Player 2 Prime on the Buy page again gets us to a computer with the same 4070 Ti, but somehow different performance numbers, presumably because NZXT is changing these so frequently that it's forgetting to update some of the other parts of the page that are dependent on the parts.
The Player 3's bait-and-switch is pretty egregious. It lists a 4070 Ti Super for the purchase, but a 4070 Ti Non-Super for the rental,
which our testing shows should have.
It's got a 10% to 11% difference at 4K and up to 15% in some situations.
And yet somehow, NZXT's FPS numbers that it uses to sell computers claim literally frame-for-frame identical performance
between GPUs that are demonstrably and publicly known to be different.
They are changing the SKUs so much that they're getting sloppy.
This very same page, lower down, states 215 FPS average in Call of Duty at ultra-high in one part of its Player 3 listing,
but 140 FPS at ultra-high in another.
NZXT's own claims have a 54% range in them.
Hilariously, NZXT's own warranty guarantees the FPS result to within 10%,
which normally would be almost impossible to prove they were deviating from,
but here, by default, at least one of these numbers will be more than 10% off of whatever you're getting.
And that means that any computer they sold under false pretenses with these egregious errors
would be warranted for replacement.
We just think...
I think this is a scam at this point.
The performance claims alone are hugely misleading,
especially since the only difference in one of these that's meaningful is the word super,
which a lot of people, especially those who are potentially renting or buying a pre-built,
won't catch that difference.
But they present two different data sets for the same parts sometimes,
and yet the same data set for two different GPUs?
As for the specs changing within a SKU that has the same model name,
this is a huge problem.
A model name is supposed to be a shorthand
for everything that it contains.
It's the sum of all the small parts so that everybody,
the company, the consumer, and reviewers, both professional and consumer user reviewers,
all understand what they're talking about.
If you're changing the parts day by day,
nothing means anything that's published online.
Likewise, if you buy the Player 3 Prime, you recommend it to a friend because you liked it,
and they buy it, and the GPU changes, and they don't know that,
now they might not hit the performance mark that they needed and that you thought they were going to hit,
when recommending the system.
Furthermore, if you shop like I do,
when you're buying something that's thousands of dollars,
you might think about it for at least a couple weeks before pulling the trigger.
Maybe you've got the tab open, and you think about it,
and tomorrow you're like, you know what, I still like this thing, I'm going to buy it.
Except the specs changed.
There's no reason you would really think to check them again,
for example, one day later,
if the product photography is the same,
if the page looks more or less the same to you, except for maybe
one number somewhere lower down on the page changed,
you wouldn't really think about it.
Think of it like the Nvidia GT 1030 situation.
They changed the memory in a way that could halve the performance in one of the SKUs.
The difference is that for as egregious and terrible the actions of Nvidia were for the 1030,
they still at least appended a D4 to the end of the model name,
which is not sufficient,
but is somehow still better than what NZXT is doing here,
where they just keep the same model name.
NZXT has not only created scenarios where it could easily execute a bait-and-switch on you,
it has also built it so that you explicitly agree to terms by purchase
that they are not responsible for the accuracy of their own product listings.
And so, and they restrict your ability to even determine the accuracy of said listings
because you have to return it unused.
And that leads us to marketing and advertising.
For NZXT's marketing tactic,
it has decided to compensate an army of social media influencers and TikTokers
to regurgitate lies and misinformation
in order to sell large volumes of its product under what we think are false pretenses.
Try this instead.
Here's a rapid fire roundup of the misrepresentations, and sometimes,
straight-up lies, of NZXT's influencer army. It actually makes kinda sense. They have zero strings attached. But no strings attached. No strings attached. No strings attached. And no commitment.
There is a commitment. You literally have to pay or they'll send you to collections. In fact, there's an entire contract of commitments and strings that are attached. NZXT will send you one of their amazing high-end gaming PCs straight to your house, giving you the ability to play any of the latest video games without breaking the bank. No contracts. No contracts. What?
Now, this is a contract for services. You call it a contract of adhesion? Right.
So this is a contract that is presented to a consumer in a take-it-or-leave-it situation.
No contracts. And until we can get our law degrees from Costco, I went to law school here. And Costco? Or TikTok, I'll trust him. And the great thing about this is that you can pretty much cancel at any time. Turning the PC is free. There aren't any cancellation fees. Cancel anytime. And there are $0 cancellation and replacement fees.
Except at the time of filming this, there are cancellation fees. But wait, there's more.
You can now own Endgame on a PC starting at $59 a month. Can't. Oh.
And with new PC hardware coming out what feels like every other day,
the new FLECT program allows you to trade in your PC and upgrade it every one to three years.
That means the gaming house will always have the highest-end gaming PCs without breaking the bank.
Because new parts are always getting released.
And after you spend all of that money investing into a new computer,
it might end up getting outdated quicker than you'd imagine.
The Player 2 has, at least right now, a four-year-old CPU.
So when you get the PC, it's already four years out of date.
If they then upgrade you in two years from your six-year-old CPU at the time to, let's say, a 7600X,
which they're selling in the pre-builds sometimes,
then now you'll only be, oh wait, still four years out of date.
The 5600X isn't a bad CPU.
But it is a straight-up lie to pretend that renting a computer keeps you at the bleeding edge when you're sending this out.
You can now get a top-of-the-line gaming PC for as low as $59 a month.
Starting at $59 a month, NZXT will send you one of their amazing high-end gaming PCs.
It's a lie, especially when they say $59 a month for a top-of-the-line gaming PC,
which in this case is not even a 5600X, but a 12400X using a CPU architecture from 2021.
So to claim it's $59 a month for top-of-the-line is false, and it's advertising.
You can put those together.
You can get this $3000 PC for only $120 a month.
This Player 2 for $120.
That's not a Player 2. We have the Player 2. It's this one.
It doesn't have those cables. There are other parts in it that it also doesn't have.
It's not a $3000 PC.
The Player 2 that he says this is is $1000 of parts.
You could double that for the build fee and still be cheaper than the number he just pulled out of his ass.
Although it's amazing.
He can pull anything out of there with all of NZXT's money up it.
Even the Player 2 non-flex pre-built purchasable PC is $1600.
And that has way better components.
They're not the same computer.
Maybe that one's $3000, but then it's not the Player 2.
At least one of these things is minimally factually incorrect and at most a lie.
But this paid partnership with NZXT shows that NZXT is endorsing it.
Completely irresponsible publication of false and, we think, harmful information to the consumer who is watching this brain rot content.
Warranty that might just end up saving you from an accident.
Like dropping the thing, which I've totally never done before.
Quote, this warranty does not cover damage or defects due to accident.
The second one is flexible payments for the pre-built audience. That could be huge for you.
It is huge. Huge scam.
If NZXT tries to come back and say,
Oh, it's just the affiliates who did this. We have no control over them.
First of all, NZXT, you're saying the same shit, so shut the fuck up.
NZXT's own webpage says,
No strings attached. Zero commitment. A PC that's never behind.
All lies straight from NZXT's own website.
Almost like it's a script.
Second, even if they didn't say the same stuff that's exactly on NZXT's website,
you can't just unscrupulously send out money and encourage fraudulent marketing.
You can't just unscrupulously send out money and encourage fraudulent marketing.
You can't just unscrupulously send out money and encourage fraudulent marketing.
By rewarding these people with money products or some form of compensation while at the same time accepting sales through those affiliate links
by rewarding these people with money products or some form of compensation while at the same time accepting sales through those affiliate links
and reaping all of the financial benefit of selling computers under a false pretense we think in a potentially fraudulent advertisement.
and reaping all of the financial benefit of selling computers under a false pretense we think in a potentially fraudulent advertisement.
The flex builds also aren't guaranteed to be brand new.
The flex builds also aren't guaranteed to be brand new.
NZXT mentions the possibility of it being,
quote,
finished,
this possible way to say used. NTXT states that its flex is neither financing nor rent to own.
It tries to spin this as a positive, saying, quote, you get a lifetime warranty, regular
refresh upgrades, and more. You're allowed to cancel at any time and are not obligated to make
payments until fully paid off, but you will be required to return your computer, end quote.
Now pay special attention to those last two words. We'll zoom in on them for you. Your computer. So
first off, it is not and never will be your computer. They make that clear, except for in
that language where it sounds like it is your computer. So even the language saying you have
to return it deceptively implies that it is your device. And just like it was never our
84,000 pound excavator that we use to bury NZXT's marketing bullshit, the flex will never be your
computer. Second, let's revisit this deceptive line. You get a
you get a
lifetime warranty. This statement is insane. The fact that they call it lifetime is insane. The
fact that they call it a warranty is insane. And it is very difficult to find where to start here.
It is neither a warranty, nor is it for a lifetime. This is not a warranty. That is not what
a warranty is. The computer isn't yours. You don't own the computer. It doesn't make any sense.
It can't be warranted for you because it isn't yours.
It'd be like renting a car for a weekend and them saying to you, good news, you have a lifetime
warranty on this car. It doesn't make any sense. It's their car. If it breaks, they're going to fix
it. They would have the warranty. They would file for the warranty if there's a manufacturer warranty
claim. It has nothing to do with you as the guy renting it. And so what are you supposed to do
with it? Like, so the transmission breaks for a different customer five years in the future. You
go, Ooh, I have the life insurance. I have the life insurance. I have the life insurance. I have the
lifetime warranty. I shall file a claim for this. It's just deceptive bullshit from NZXT. It
doesn't make any sense. Like it's not the service is to provide you a functional computer.
That's it. It's not a warranty. That's the thing you're paying for.
As for who would actually consider paying for this terrible service and being a victim to it,
we think this post makes it pretty clear per Reddit quote, I'm 15 and make around
$25 monthly from my dad. Should I subscribe or not? No, it's clear that this is targeting a
younger crowd that is going to be very easily influenced. And if you think about it, Carter
PCs did make a video about it. 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. Switching from console
to PC has never been a cheap date, which always made convincing your parents or wife to buy one.
Now, because you're buying this on not credit, but not cash,
there are some potential pitfalls for NZXT as well, which include getting scammed if they're
not able to successfully scam their own customers. We wouldn't want the scammer to become the scammed.
So when we ordered, we subscribed to it using a fake name. We do this for every computer we buy
as a prebuilt for investigation because we don't want them to know where it's going.
NZXT asked us to upload a photo ID to prove some form of connection between the name
and the purchaser to prevent fraud. We couldn't prove the identity,
but we wanted to prove the authenticity of our customer because they don't exist. The name is fake,
there is no ID. These are not the customers you are looking for. And so we didn't upload an ID for that
customer name because there simply is not one. But NZXT wanted money, so it decided that we did.
And we thought that would have been the end of things and we wouldn't have been able to get the
rental PC. But a couple of weeks later, a computer showed up, interesting since confirming the ID is
actually impossible with the person we ordered it to.
of a human with the name we used, all of this becomes even more interesting, because NZXT's
service provider, Fragile, does a soft pull on your credit. I filed for a full, detailed credit
report from all three major agencies and found no such soft pull in my account records. NZXT says
that, quote, this credit check does not show up on your credit report or impact your score, end
quote. But other soft pulls do appear in the report that I filed for. An accountant that we spoke with
informed us that the pull should show up, but I'm not an expert on this, so maybe it just didn't.
This is all important because the lackluster checking here is already an instant red flag
for something which is potentially already a financially predatory program. Now, we still
need to talk about NZXT's pricing here, which is really hard to do and incredibly confusing
because of its earlier explained bait-and-switch tactics. We have two charts we're going to show
for this. The second one has a 104% illegal loan that violates
U.S. law. The second one has a 104% illegal loan that violates U.S. law. The third one has a 104% illegal
loan that violates U.S. law. But the one we'll show first is this one. This is a chart that's
made to show the cost of ownership of the Player 2 rental that we subscribe to. It's... don't actually
own it. Rentership, I guess? It would compare it against the Player 2 pre-built, except they're
not comparable. So we need to add a scam-normalized benchmark. We first tried to use iWebHour for the
pricing, but we couldn't find any systems that had a CPU old enough to compare to NZXT's rental,
so-called top-of-the-line BC, and NZXT's $1,600 pre-built of the same name isn't comparable
because it's CPU. So we need to add a scam-normalized benchmark. So we need to add a scam-normalized
CPU is a full generation newer. We checked CyberPower, Starforge, Dell, HP, and none of
them sold computers with parts as old as NZXT's rental here. DIY cost for NZXT's rental PC is
around $1,000. We took a cross-section of historical pre-built price data and of modern
comparable pre-built and averaged the total upcharge over DIY by percent. Typically, the
most aggressively priced pre-builts are about 15% over DIY for this range, but we'll be generous to
NZXT and call it 25% markup on DIY for a $1,000 build, putting it at $1,250 for the equivalent
of the rental. This added line normalizes the price for NZXT's bait-and-switch, so at month
seven, it would be cheaper to DIY the PC than the total cost of the rental in the same period. Plus,
you'd actually own something that you could sell, give to family, friends, or do anything else other
than send it back to NZXT. If you must have a pre-built, the rental price crosses the price
of a similarly built pre-built at about nine months. Let's just say you can't afford $1,250
and you do something we wouldn't recommend, which is take a loan via Affirm or
buy it on credit or some payment plan service that most of these companies have today.
At the quoted default interest rate that Affirm applied, we'd be at $1,352.76 total cost and fully
paid off in one year. The rental would exceed this monthly cost immediately. With the quote that we
were given, it would cost more per month for the rental than to buy it on credit. The rental would
exceed the paid-down pre-built cost on this credit quote at around month 10. Our chart scale is now 10
a year, and we're adding a line for buying the same-priced PC every three years on an aggressive
upgrade cycle. If you buy a new computer every five years on a more typical one, that's year two.
If you've decided that humanity has had a good run and you get on board with a rental PC in 2024,
then by year 10, you'll have paid enough to buy a decent used car, almost $16,000, assuming the
price from NZXT for the rental doesn't ever go up, which it will. If you upgrade it every three
years, year 10 would have you at $5,000.40.
This is the Player 3 Prime. NZXT used to offer the pre-built purchase with an RTX 4090 and then
silently downgraded it to a 4080 Super when you clicked subscribe in an absolutely insane bait
and switch. As we're writing this, they've changed it again, and both the rental and the purchase now
use a 4080 Super. We'll see how long that lasts. That makes this easy, because the rental has the
same amount of money every build, and you don't just upgrade it instead, which is far cheaper.
Here's the chart calculated at a five-year period. Over five years, the $259 per month rental PC,
which you would not own at the end of five years, would cost $15,540. If you buy NZXT's spec right
now on Newegg, it's about $2,300 to $2,400. With the same major components, assuming they don't
change it, it's $3,000 from NZXT. We used Affirm to get a quote at a 22% rate, and they came back
with $3,369.50.
And 40 cents for a one-year pay down. But let's normalize for time. If you take a five-year
personal loan at the maximum legal rate permitted in several states, which is 36% under statutory
usury law, it'd cost us $6,504 to pay for the $3,000 computer over a five-year period. And the
monthly payment would be less than half of the payment of the rental. And again, you'd own it.
We then broke NerdWallet's personal loan calculator, which can't accept a rate higher than 99%
because it's not legal.
And so I had to call my banker to ask for help quoting me on an illegal predatory loan.
After some questions about my mental health and many disclaimers that this is not a real
loan being offered, it is purely for journalistic purposes, for research, it is not something the
bank does, etc., we came to a five-year pay down at 103%, equaling the cost of the rental PC over
a five-year period. So even if you take this illegal loan, you're in better shape over a
five-year period. And to be clear, don't do that.
That's bad. There's a reason they're predatory loans. Dialing it back, the five-year cost of
ownership is 418% higher than the purchase cost of the machine at $3,000. Now we get to the fun part.
Criminal loans. So, uh, called around, did some research online and otherwise on payday loans.
If you haven't heard of this predatory lending practice, here's what the North Carolina Justice
Center says about it. Quote, bank payday loans create a debt trap, just like other payday loans.
Rather than solving a financial crisis, they sink the borrower into a deeper financial hole.
Center for Responsible Lending research shows the average bank payday loan costs 365% annual
interest. Bank payday customers are in debt an average of 175 days a year with an average of 16
transactions. Like any industry, there's different types of products for a predatory loan. There's
bank payday loans, payday loans, loans from the mob, indexes. There's all kinds of options.
It's a really interesting and exciting field of professional activity. So we did some research
using a mix of public resources for payday loans and predatory lending awareness and speaking with
the people, we put this together. We cobbled together this charted scenario of taking a
$3,000 loan to play video games with a so-called finance fee at $5,250. Assuming you could pay it
back.
It would be $8,250 total owed, which is still cheaper than paying for the same machine for 32
months. In other words, if you were to keep this example PC from NZXT for at least 32 months,
you might actually be better off taking a definitely predatory, possibly mafia backed,
and almost certainly criminal loan, and then owning the computer at the,
the end of it. And it'd be like the same price, depending on your terms. And if they don't break
your kneecaps first. Now we're going to talk about the terms of service, which these are really
aggressive. And Vincent Augusta, an attorney who's joining us for this, we hired him to provide his
expert insights, read through the contract for us and provide some thoughts. He had several key
points where his concerns were about the fairness of the contract. It's crazy how this contract is
written. It is really aggressive.
It's overreaching. So let's get into the discussion. What I have printed here is 13 pages
of subscription agreement. From a base level, what differentiates, let's say like a predatory rental
agreement from something that's more fair for consumers? You know, what, what does a consumer
look out for in a broad sense? And then we'll get into the specifics.
Most of these rental agreements, they are contracts of adhesion. They're kind of in a take it or leave
it situation. You're not really negotiating a lot of the terms, but there's still things that you can
look for.
Yeah.
That,
will help indicate the fairness of the document generally, and also the intentions of the company
you're doing business with. One of the major problems with the subscription agreement here
is looking for terms that aren't punitive. And by punitive, I mean that there is a way of writing
these kinds of agreements that protects the legitimate interests of the business engaged,
in this case, in a subscription, in a rental agreement. But there are also ways
of trying to protect the interests of the company that look more like they're just punishing consumers
for not following hyper technical rules or setting kind of impossibly high standards.
And we'll come back to this, but like the packaging.
Correct. Yes.
What jumps out at you as concerning?
Some of the first terms that jump out have to do with the return process itself. And so you can see by the language of the agreement that the customer's
the customer's
the customer's
is required to return the rental device using the original packaging. So now original packaging here is not defined. And so we would apply kind of a plain
English meaning, understanding to that term. Packing paper, if there are 72 styrofoam peanuts, then you need 72 styrofoam peanuts. The business has a
legitimate interest in getting their product back safely. But the way that this term is written is that it allows for a kind of a series of pit
a series of pitfalls for the customer in attempting to accomplish that goal.
All right.
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agreement, the customer fully accepts the charge as legitimate and can no longer dispute it.
And so this is very concerning for a couple of reasons. One is it doesn't indicate a limit for
the amount. So if the business messes up two decimal places and charges the consumer $5,000
instead of $50, by the terms of this agreement, if they aren't properly notified of it, then within
60 days, the consumer would be adopting that charge. Also, the fact that it requires it in
writing is somewhat counterintuitive. So if you noticed a charge that was in excess of what it
ought to be, or a double billing or something like that, your instinct might be to pick up the phone,
to give them a call. But by the terms of this agreement, you haven't properly notified.
Is there a...
Statute for what they're trying to do here? Like, does something exist? You practice law in North
Carolina. Does something exist here where if I go through a retail checkout and I find out they
scanned an item twice, right? Like, is there like a window where I can dispute that?
Generally, in North Carolina, you'd have three years to bring that charge. And again, that's not
an internal dispute with the company. That's for a civil action. But by the language of this
agreement, it appears that the consumer has a right to dispute the charge. And so, you know,
it appears that they're attempting to modify that and go from a three-year statute of limitation
and bring it to a 60-day statute of limitation, which I could not find any North Carolina
precedent that involved a court upholding a 60-day statute of limitation modification contract.
I will tell you that the UCC provisions, the Uniform Commercial Code that's been adopted by
North Carolina, limits the reduction in statute of limitations, at least for the sale of goods,
to no less than one year.
Okay. All right.
Now, this is a contract for services, so it's not governed by the same law, but it seems to give an
indication of where that line might be for North Carolina courts. It almost harkens to like a fair
credit billing act kind of language is that in federal law, when there is a kind of a fraudulent
charge on a credit card, a consumer has 60 days to bring it to the credit card company's attention
to dispute it.
But this is not the same situation. And obviously, those limitations are very different because it's
not the credit card company that's billing you. It's the third party that's billing you through
the credit card company. Here, the billing is direct. And so for there to be a direct billing,
that if it is erroneous, you only have 60 days to challenge, is exceedingly concerning.
When returning the rental equipment, the agreement stipulates that the consumer
must use, quote, all reasonable efforts to prevent damage and theft when packaging the product.
So a couple of things that are concerning here. The first is, is that all reasonable efforts is
pretty broad. But more importantly, what you're attempting to effectuate is the prevention of
damage and theft, which is functionally an impossible standard. It doesn't really matter
how you package something. If it falls off the back of a FedEx truck on the highway and someone
runs over it at 60 miles an hour, it's going to be damaged.
That goes back to this idea of drafting these terms on one side to protect the legitimate
interests of the business and the other side to kind of punish the consumer. Not what you would
want to see in an agreement if you were looking out for a consumer, because it's not appropriately
attributing the responsibility. If the product is returned damaged or materially altered,
then the remedy that the agreement provides for the business is,
quote, a replacement fee up to the full retail value of the computer. And so this is concerning
for a couple of reasons. One is that it doesn't make any mention of a relationship between the
cost of the damages and the replacement penalty. What is a soft credit pull as far as it relates
to this agreement? And what are the privacy concerns you have with the agreement?
The idea is that they're looking to get information,
about your credit, without doing kind of a hard credit inquiry. They're not indicating to the
credit agencies that you're looking to take out a line of credit. They're just trying to get
information about past credit interactions that you've had, which is a little invasive. But again,
I think going back to the original discussion, that is something that in many ways reflects
a legitimate interest that a business might have. And it might be a business doing this kind of
rental agreement. It might be an employer looking to do a background check. Those seem to fall into
the category of legitimate business interests being protected. Then you have the license for the
personal data. So this part of the subscription is really problematic.
Can we read it? Do you have it line by line?
So this is a direct quote from the subscription agreement. It says that you, the consumer, grant operator
of the business a non-revocable, perpetual, non-exclusive, worldwide license to use and distribute however the operator sees fit,
any and all images, video correspondence, audio recordings, or other data and information.
Is there a good reason for that that you can think of?
A good reason for the business or for the consumer?
For the business.
For the business, it's to sell your data.
Okay. All right.
To use the data to pursue debt collection. But realistically, it is pretty much as broad as it
could be. I mean, if it's not specifically and explicitly limited by other
law somewhere else, then they probably can do it. It states that it is any and all images,
videos, correspondence, audio recordings, or other data information which you provide to them in
connection with the subscription of the services. So connection is exceedingly broad. That category
of data seems to encompass just about everything. Your name, your email address, your address,
personal information, an audio recording of your voice, pictures of yourself,
and if it's on the hard drive and it's returned to them, then that seems very reasonably to be in
connection with the subscription agreement and the services provided. You've provided it to them.
Whether or not you did it intentionally is maybe up for debate. But if it's on the hard drive and
you return it to them, you've provided it to them and it's pursuant to this agreement.
And it's in connection with the service.
It's in connection with the service.
Yeah. And in this case, you can't even negotiate. You call it a contract of adhesion.
Right.
So this is a contract that is presented to a consumer in a take it or leave it situation.
So you're a Magic the Gathering player.
Once in a while.
Depends on who you ask.
I'm going to play devil's advocate here. If NZXT, from a demonic attorney's perspective,
there's a legitimate interest of, we're providing this rental, there is a possibility it gets
stolen. Where they pay for one month, they get it, and they never pay us again. Might they then
form a dark pact to offer you a contract from below? All of these are anti-cards.
All of these are banned in every format. You cannot play it.
Okay. Well, that's beside the point. Okay. Don't ruin my thing.
I was so distracted. I didn't even hear your question. Can you repeat the question?
The question is, I'm NZXT. I'm just protecting against a user signs up, they pay $60,
they get a computer, they cancel the payment, and they keep the computer.
Right.
They have stolen from me.
Right.
Right. So, what's wrong with me trying to protect myself from thieves?
Right. And I think it's an excellent point. And the answer is, I don't think there is anything
wrong with trying to protect that interest. I think it's the peripheral of the subscription
agreement that becomes problematic when you have terms that are punishing consumers for
not following hyper-technical requirements, impossibly high standards, extremely small
periods of time to
address issues with the relationship that actually have no
connection to the actual subscription itself. I mean,
overcharging a consumer and putting a 60 day time limit to draw attention to that
and putting technical requirements that it'd be in writing for the notice
has no relationship to the actual
subscription agreement that is being negotiated here. So it's those kinds of terms. The licensing
agreement for the use of private information. Those are the kinds of things that
are problematic, because they
don't speak to the interest that's being invested in the system and the people that are out there that do this.
that you just described, which is perfectly legitimate,
and instead create these angle-shooting opportunities
where consumers can be punished for things
that don't facilitate anything on the business side.
Yeah, and this is where it comes back to
it's not about what might they intend with this language,
it's about what's written with the language for me.
Correct.
And that's how the contract will be interpreted.
Right, and so I don't take a charitable interpretation
with it because that's not how it's going to be used against me
if it is used against me,
which is my not-legal-legal advice.
It's not legal advice,
but it's something you could think about, maybe.
Have I sufficiently couched that?
Is that qualified well enough?
Yes.
Okay, you've heard it here first.
That is his not-legal advice to me,
providing not-legal advice to you.
That's good enough.
All right.
So there's provisions of the subscription agreement
that provide a kind of extreme one-sided benefit to the business
without any kind of benefit to the consumer.
So one of the things in the agreement
is an attempt to limit the direct damages
that the business can be responsible for.
The subscription agreement says that
the aggregate amount of direct damages
that operator, which is the business, will pay
you for claims under these terms
is the total fees paid to operator by you
in the six months immediately preceding the event,
that gives rise to such a liability.
They're attempting to limit their damages
for liability to whatever the amount is
of the six months of subscription fees
prior to that event happening.
So in a lot of ways, this looks like an attempt to create
what's called a liquidated damages provision.
It's an attempt to, if the parties to a contract
are struggling to figure out what the damages might be in the future
and there's kind of a difficulty of
discerning their risk,
then parties can, in theory, negotiate a fixed amount
that will replace a calculation of the actual damages
for breach of the contract.
What sorts of things does this,
are they attempting to cover here?
It seems as though they're attempting to cover everything.
NZXT has in the past sold computer cases
that the CPSC, Consumer Product Safety Commission,
has issued notices on.
If they happen to sell you a computer that catches on fire,
is that the type of scenario, maybe at the extreme end,
but that is attempted to be covered here?
Correct.
Okay.
I mean, and they make every effort to waive
every single kind of liability
that they are legally allowed to waive.
And so you see this in the attempts to reach
the absolute maximum liability protection,
is that they use language that's specifically against them,
and they actually acknowledges
that this might not even be enforceable.
So for example, in this liquidated damages provision,
it says, if permitted under prevailing law,
the aggregate amount of direct damages.
And the reason they say this is because
this kind of provision is disfavored under the law.
And in many jurisdictions, including North Carolina,
this will probably not be enforced.
And the reason being that for liquidated damages
in North Carolina to be enforced,
you both generally have to have a difficulty.
Assessing the damages at the time of the contract,
but also the amount has to be a reasonable attempt
to approximate what the actual damage should be.
You can see in this assumption of all risk,
it says, you acknowledge that use of this device
may cause illness, including but not limited to bodily injury,
disease, strains, fractures, partial or total paralysis,
other ailments that could cause serious disability,
mental or physical anguish, or death.
And you expressly agree to assume all risks
and accept all responsibility for any accident,
personal injury, property damage, death,
or disability that you may suffer as a result
of using the services and rental devices.
Waiver and release of claim.
You hereby expressly agree to waive and release
operator and service providers from any and all claims,
including those in contract,
which is what this agreement is,
tort, including negligence, statutory and or other grounds,
including without limitation claims for relating to
any accident, personal injury, property damage,
death, or disability that you may suffer
as a result of using our services or products.
So, again, is all of this enforceable?
Potentially not.
Will they attempt to enforce all of that?
Potentially not.
But they are, by the language of this contract,
attempting to reach the absolute bounds
of liability waiver that they can possibly achieve.
If I'm a really serious consumer and I want to pay a lawyer
to review all contracts before I sign them,
which is like, you know, doesn't exist,
but let's just say that's what I'm doing here, right?
I come to you, I say I'd like to retain your services,
can you read this for me and tell me what you think?
You know, what would that conversation be after the fact?
How, what would be your quick recap to me, right,
of how you feel about the agreement overall?
I think it's concerning because there are lots of
potential pitfalls for the consumer.
There are lots of places where you can run into problems
that you wouldn't necessarily think intuitively
that would be problems.
There are places where the technical requirements
by the terms of the contract are nearly impossible to accomplish.
The use of your data for any and all reasons is problematic.
And so there's a lot to be concerned about with this agreement.
There's a lot of terms in this agreement
that go well above and beyond what is necessary
to have a contract for the rental services of a computer.
So one of the other sections in the agreement says,
under 14 warranties,
the accuracy or completeness of product information
is not guaranteed and is subject to change without notice.
You are solely responsible for evaluating and selecting products
and determining whether each product is fit for a particular purpose
and suitable for your use.
The concern I would have is about the accuracy or completeness
of the product information not being guaranteed.
Right.
You have on one side their complete express waiver
of the warranty,
the warranty that their descriptions are correct,
that anything is accurate,
that they've said for the fitness or purpose of the computer
what the specs are.
But on the other side,
the remedy for that for the consumer
is exclusively, by the terms,
to return the product unused.
Okay.
This is a quote.
Your sole remedy for a product being materially inaccurately described
is to return it in unused condition
complete and undamaged in the original packaging
and have operator replace the product.
I think it is literally impossible
to do that in some cases.
Because if I turn the computer on
and I load BIOS
and see that it's not configured to the memory spec
that they have stated,
which might not necessarily be quick to determine
without turning it on, without using it,
and I complain to them
strictly by this contract,
I guess their response is,
well, we didn't guarantee that.
It appears as though that would be something that they could do, yes.
Right.
If you were to receive a product that was,
and this is their language,
that was materially inaccurately described,
if you use the product
to determine
that it was materially inaccurately described,
then you would no longer have a remedy
and you would be stuck with that for some period of time,
whether it be a month of description,
or whatever it would be.
Right.
Any final words on all of this?
Like, I mean, do you have anything we haven't covered
that you want to go over?
At the risk of repeating myself
from previous videos,
it's important to read these agreements.
Just because they're boilerplate language
doesn't mean that they can't be enforced.
I think that most people
who would have agreed to this
would be surprised to find out
that some of these things were in here.
I wouldn't expect everyone to read
every agreement they're presented with,
even though on a pure technical level
you quote-unquote should.
But realistically, you know,
Apple presents the terms of service for iTunes
and then we get a South Park episode.
So most people don't read it.
This concept of renting a gaming computer
is relatively new.
I personally would read stuff like this
because it is so unchallenged
in this specific use case that this is...
If anyone's wondering, like,
where should I draw the line,
what to read and what not,
this is the kind of thing I personally would read.
I mean, obviously, I would say read everything.
Of course.
It's not realistic.
It's not what anyone does.
But that is, unfortunately,
that's really the only option
to make sure that you're getting fully involved.
And these companies know that.
They know you're not reading the 27-page EULA
or whatever to download a Steam game.
Right.
But technically, you should read it.
Anyway, that will recap
sort of the legal discussion of all this.
Hopefully, it gives people something to look out for too
and other contracts or warranties.
But we will jump back to the rest of the review.
And thank you, Vincent.
Thanks for having me, Steve.
For dealing with my Magic the Gathering references.
Always. Happy to oblige.
Next time, I'll bring cards that weren't banned in play.
First off, in light of this investigation,
we are proud to award NZXT
with our first ever repulsive,
most unethical,
amoral,
corrupt,
dishonest,
shady,
predatory advertiser award.
Surprise!
Along with this award,
which we are shipping directly
to the NZXT corporate headquarters in California,
the company will also receive a free lifetime ban
from being advertised on Gamer's Nexus.
And it can be the proud recipient
of a brand new entry
on our permanently banned advertisers list.
They'll be listed alongside prestigious,
but generic categories
for g*mbling,
crypto scams,
and grey market CD websites.
Congratulations, NZXT.
We never thought you'd make it this far down.
The only other banned hardware manufacturers
are due to concerns over conflict
because we cover too much of their stuff.
But NZXT truly is the first to become
perma-banned for being scumbags.
And we've covered a lot of scumbags.
So while we'll continue monitoring their activities,
their hardware, software, and other launches,
or whatever they have going on,
and covering it when necessary,
what we will not do is ever allow NZXT
to advertise with us directly ever again.
I can't control the YouTube AdSense ads.
But in terms of things we do directly control,
they're banned.
It's done.
So currently NZXT has an invoice
we've sent over for the prior round of ads
that were already served before all of this.
But we have canceled their quarter four ad campaign.
They will not be charged for it.
And like I said,
that one was like 23 grand or something like that.
And NZXT is an easy market.
NZXT is an easy revenue stream.
We've been working with NZXT on and off for years now.
They are one of the longest standing advertisers
on the channel.
But since the H1,
it's really just gone downhill.
And there were individual products
we're totally okay with.
I mean,
the power supplies have been fine.
And that's what we ran the ads for last time.
But this particular issue,
this program they have for the rentals,
is so disgusting that
we want zero advertising relationship with them
at all ever again.
That is genuinely,
I am that upset about what they are doing to people
with this program.
So,
yeah, we,
years ago,
before we decided to not do any type of contract work at all,
I even did some contract writing for NZXT.
We're talking like almost 10 years ago now,
something like that.
So,
we've done a lot with them over the years.
But we're cutting off an easy revenue stream with NZXT.
We can do that without really any concern.
Now,
as for NZXT's program,
I personally would immediately return the computer
and cancel my subscription.
NZXT sort of traps you
by nature of the program.
A rental computer,
you set your whole life up on a rental computer.
And it makes it harder and harder
to cancel a subscription computer
the longer you have it,
because you're more entrenched in that system
and it's going to be more of a pain in the ass to migrate,
especially if you don't even get to keep the drive.
So the sooner you can break free of that,
in our opinions,
the better,
because it only gets more difficult to migrate later on.
Likewise,
because their advertising is so blatantly false
in some scenarios,
or their partner advertising,
their paid partnerships,
hashtag NZXT partner,
all this stuff,
it's so wrong.
Plus their own first party site,
like the FPS benchmark discrepancies
we found on their own page with their own numbers,
we think there may be some real exposure here for NZXT.
But also for the FPS benchmarking,
every single computer we think sold under the FPS warranty terms
would be in violation
of their own FPS warranty,
because it's not possible to be in compliance with it
while having numbers that are sometimes so wildly off
for the same benchmark on the same computer.
So feel free to submit your claims,
I guess,
under those terms.
If they don't honor it,
they'd be violating their own terms,
which could potentially result in a strong civil action.
Now with terms that in some cases can be worse
than loans that can't legally be given by financial institutions,
depending on which federal or state laws you look at,
for something that you don't even own at the end,
to us,
it looks like NZXT has absolutely no interest
in participating in a healthy ecosystem.
It has joined the ranks of the greediest
and most disgusting anti-consumer companies,
we think,
that are in this industry.
NZXT, with this program,
makes Corsair look totally fine.
Corsair, it's a bad deal.
There's a lot of markup.
They might assemble it incorrectly,
and it's a gigahertz under that,
and it's not the actual spec of the CPU.
But it just seems so innocent by comparison.
It's crazy.
So, you know,
NZXT is no longer the company I knew
when I started in this industry.
I am saddened to see that it appears like the CEO
also does not have the standards
and the values that he once did.
You may think he does,
but the actions of this company do not reflect that.
And being diluted certainly doesn't help from investors.
Ten years ago,
NZXT launched the bright white H440
from within the cigarette yellow walls of Circus Circus,
a $25-a-night shithole in Las Vegas for CES.
The company was small and scrappy,
and willing to stay in the shittiest hotel on the strip
to try and get its name out.
And like most media,
I was thrilled to see what they had,
irrespective of the quality of their suite.
That didn't matter.
What mattered was what the company was making.
And NZXT seems to know that,
and that was awesome.
I love that scrappy approach to it.
That's how I came up in the industry.
That's how I came up in the industry too.
I can relate to it.
But that NZXT is gone.
It has been consumed by the mega corporate overlords
it now must entertain.
It's as if CEO Johnny Ho got into the boardroom
with NZXT's investors,
which include co-founders of Twitch,
Fitbit,
Hypebeast,
and his $100 million basically donors
at Francisco Partners,
and came up with the most insidious way
to unload components in an unregulated rental market.
NZXT's contract makes sure you don't have to worry
about owning the computer,
because you can't.
They make sure you don't have to worry
about your data privacy,
because there is none.
And it's the easiest possible path
to being able to depreciate
some of their old aging components,
collect money on it,
and if it doesn't come back in some cases,
whatever.
It's a write-off.
Sell it to collections.
Move on.
It's old inventory anyway.
So the program genuinely
is absolutely brilliant
in the most evil,
draconian ways.
It is impressive.
So again,
this is the beginning of the end
for owning a computer
if people allow this to take root and spread.
But this video would be a lot different
if that's all we had to say about it.
And it's not.
This program in particular,
if that's the future,
regardless of whether that's the future
or whether it should be the future,
whatever,
not owning a computer,
NZXT's version of that future
cannot be allowed
to persist and continue
because it is such an offense
on all fronts
and it is exceedingly predacious.
So that's it for this one.
Thank you for watching.