In an age where video game buyers seem unwilling to pay more than $60 for a brand-new game despite rising costs for premium product development, publishers regularly look for ways to keep feeding the bottom line. In mobile gaming, "free-to-play" titles funded by some form of loot box revenue stream have largely taken over the market, and many of them stand accused of leveraging psychological tricks to keep you forking over your hard-earned cash.
With a loot box, this increasingly notorious revenue generation technique encourages the player to spend real money to purchase a digital container that houses a randomized selection of in-game items. Sometimes these items are merely cosmetic while others directly affect gameplay, but the bottom line is that it can feel like a form of gambling, and there are no age limitations on loot box access.
And exposing children -- and their parents' wallets -- to open-ended gambling isn't going over well in legislative circles. In Belgium, Electronic Arts -- exclusive owner of the rights to make FIFA and NFL games -- is reportedly under criminal investigation for what the country's government believes are violations of its gambling laws. And now the US Federal Trade Commission has confirmed that it is looking into the issue as well, Polygon reports.
In a Senate oversight committee meeting yesterday, former New Hampshire governor and current US Senator Maggie Hassan checked in with FTC Chairman Joe Simons, who confirmed that he would report back to the committee with findings. She added, "It's time for the FTC to investigate these mechanisms to ensure that children are being adequately protected. And to educate parents about potential addiction and other negative impacts of these games."
As far as psychological tricks go, the game companies may include exploiting anxiety through "limited time" offers; slowing down content progression in a way that can only really be solved by purchasing boxes; bulk pricing for large batches of boxes or in-game currency; and distributing these games to social media influencers who may be encouraged by the publisher to purchase boxes and to record or stream footage of themselves opening them.
As you might imagine, children are particularly unprepared to resist these sales pressures, which now bleed from mainstream games into those specifically designed for a very young audience. Making matters worse, children can have difficulty separating entertainment from advertisements. So when their favorite fictional characters start encouraging them to roll the dice on a loot box, it can become a real problem that sets the stage for some really bad habits in the future, like an outright gambling addiction.
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In response to Polygon's report, the Entertainment Software Association went on the defense with a statement that reads in part, "Contrary to assertions, loot boxes are not gambling. They have no real-world value, players always receive something that enhances their experience, and they are entirely optional to purchase. They can enhance the experience for those who choose to use them, but have no impact on those who do not."
Of course they have no real-world value, if you sell the key to the treasure box instead of the box itself. Or if you arbitrarily make it impossible to sell or trade these items. And a modest trickle of in-game currency is technically better than nothing at all. But one has to question the assertion that loot boxes never have an effect on the gameplay experience of other players.
But ultimately, the dictionary definition of gambling is a gaslighting distraction. What matters is that these boxes habitually make use of exploitative techniques, in a context where the target audience is known to be less experienced and more vulnerable. Given that the ESA is populated by game publishers, its statement indicates that we cannot expect it to rein in the worst examples. So it may fall to the government to impose regulation or outright prohibition.
- In a Senate oversight committee hearing yesterday, the chairman of the Federal Trade Commission confirmed that the FTC was looking into the legality of video game loot boxes in the United States.
- Video game loot boxes have been frequently characterized as a form of gambling, which the Entertainment Software Association disputes.
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- Video game loot boxes under scrutiny by 16 gambling regulators (CNET)
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