Then I would imagine the problem is that everyone is playing video games at about the same time, i.e. in the evening or at certain times of the week end. So you need to provision for peak usage.
So to me the only benefit to renting is if there are lots of occasional gamers, that do not play every day / every week, including peaks where they would all suddenly play at the same time on certain days (christmas, long week ends, release of new game, etc).
And then of course because the hardware progresses so quickly you need to amortise the hardware pretty fast.
I haven't seen the actual economics but I am surprised it would be much cheaper for consumers.