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UK Report Says Loot Boxes Should Be Regulated Under Gambling Laws!
By Shane Addinall Sep 18, 2019 OpinionA UK House of Commons report states that loot boxes use the same mechanics as casino games and encourages gambling adjacent responses from children. What does this mean for the future of the billion-dollar loot box industry?Since the launch of free to play mobile games there has been an encroaching scourge in gaming, the micro-transaction. Initially, the innocuous micro-transaction made sense. You received a free game and so to show your support you would purchase in-game items for a small fee.
This show of support for free games, however, has been co-opted by Triple-A Game developers such as Bethesda, Activision, 2K and EA where standard game features and content are now locked away behind paywalls forcing you to spend money on required in-game items in addition to the games $60 launch price.
✓What Is A Loot Box?
In order to encourage ongoing purchases, the gaming industry starting using similar triggers to casino games. You cannot simply purchase an item or character skin in these games, rather you purchase a card pack or weapon box or some other “surprise mechanic” and hope to receive the desired in-game item. These items range from common to high tier in 'value' with the rare items only dropping infrequently to encourage consumers to “spin again”.
In short, understanding the mechanics behind these loot boxes, regardless of their visual presentation, these video game developers have been using the same mechanic as a slot machine to encourage repetitive purchase behaviours in children.
Their only safety net has been the fact that gambling is defined by most countries, especially those who are not regulated, as “games of chance played for money”, and since the items obtained from these loot boxes cannot be legally sold for money it is not “technically” gambling.
✓UK Children Are At Risk
The UK is one of the key regions to not yet take a firm stance against loot boxes. This is primarily due to their stringent gambling regulations which do include the “for money” caveat around casino games. However, a recent report by the UK House of Commons could finally be the beginning of the end for unregulated loot boxes in the UK.
The report states plainly that loot boxes should be regulated like gambling and children should not be allowed access to loot boxes as they encourage gambling behaviour.
This report leans into the alternate definition of gambling which is a “risky action in the hope of a desired result”. Teaching children to spend real money in the hopes of a chance at a winning an item they deem valuable is encouraging gambling behaviours.
It is this point of real money spending, and perceived value that had Dr Aaron Drummond and Dr James Sauer argue that “real-world monetary value is too narrow a definition when it comes to loot boxes” as it effectively “ignores the subjective value created for players”.
They go on to add:
“The fact that players are demonstrably willing to pay real money for the chance to acquire these items; implying they have a monetary value even in the absence of the ability to convert them back into currency.”
With this in mind, the report calls for UK legislators to consider the children first, demanding that the Triple-A gaming industry provide proof that loot boxes do not encourage gambling rather than proving it does. It is one of the few times that assumed guilt with a call to prove one's innocence has been met with applause.
The Tipping Point
The report goes on to hammer game developers attempts to obfuscate the data they have on gaming and spending behaviours at recent inquiries, calling them "wilfully obstinate". While this obfuscation raised their hackles, it has been reported that the launch of NBA 2K20 was the final push that the commission needed to step up and make these strong recommendations.
No sooner had the earlier report admitted that the lack of monetary return meant these surprise mechanics didn’t technically qualify as gambling than publishers 2K Gaming and Take-Two Interactive launched their basketball game NBA 2K20 with literal slot and pachinko machines as the in-game mechanisms for acquiring high-tier basketball players and other in-game items.
If common sense prevails this report, and the support of both the gaming community and professionals like Dr Drummond and Dr Sauer, could see loot boxes regulated in the UK in accordance with gambling laws as they are in Belgium and the Netherlands.
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