The Q&A session between Netflix and its investors recently wrapped up today. During the event, in which we attended virtually through the power of the internet, Netflix didn’t say a word about a video game rental service. Just last month, game rentals were one of the high points Netflix offered when it was promoting Qwikster. Ever since the Qwikster plans were cancelled, Netflix has remained mostly mum on game rentals, only stopping the silence to state it isn’t sure if games will be offered. After reading and hearing Netflix’s third quarter financial results and its letter to investors, I think I have a good idea why games may be off the table for the foreseeable future.

Yesterday evening, Netflix announced it was splitting its streaming and DVD business into two parts. Qwikster is the name of the new Netflix-owned company that will handle the DVD side of the business. Qwikster will also add games to its library of content that’s available to rent. This could result in some big problems for GameFly.

As E3 2009 gets closer more news is coming out that makes the PSP appear more viable to consumers than ever before.

Besides rumored hardware redesign, rumors are also circulating about a possible game rental and music download service coming to the handheld.

The PSP already supports the ability to watch movies and play games that are purchased online via PSN so music seems like a natural move for the PSP. Sony has apparently been talking to record companies about bringing a music service to the PSP but no deals have been made just yet. Sony already has numerous music labels under it’s belt including Columbia Records, Epic Records and the RCA Music Group so it’s more than capable of providing its own music content to set a precedent for other labels.