Workshop on loot boxes and their effects

Viktor Vangelov | Published 17 Aug 2020, 12:46 p.m.

We have reported on loot boxes, their status and the controversy that has been sparked by loot boxes and their popularity, especially among younger people who are generally more into gaming.

The gaming industry has been under scrutiny because it is thought that loot boxes are essentially a form of gambling and one that’s unregulated at that. Last year there was increased pressure on government to act on loot boxes. The total profit of the gaming industry is estimated at £110 billion. It is a massive industry and it is no wonder that there’s a lot of interest and controversy.

A month after loot boxes were discussed in the House of Commons, one gaming company decided to withdraw loot boxes from one popular game. At that point it was pretty clear that the pressure on game providers and other stakeholders that can have an impact on the use of loot boxes will keep on mounting in the following months. There were further calls to classify loot boxes as gambling this year. The multi-party parliamentary group that deals with gambling related issues is one example where this pressure was made. Labour MP Carolyn Harris is the chairperson of this group and she is strongly opposed to loot boxes, i.e. to the non-restrictive approach towards loot boxes.

Six concerns were raised

A new report that sheds additional light on loot boxes and their nature has just been published. We’re talking about the Federal Trade Commission report which was generated following a workshop. It was cleverly named ‘Inside the Game’ and the goal was to analyse all issues that have to do with user protection. Within the workshop, six specific concerns were listed.

The first concern is that the mechanics of loot boxes are quite confusing, or one would even say manipulative. Then, it has also been discussed that loot boxes and the way they are presented and marketed pressurise players to spend more. Furthermore, the odds aren’t shown, so the player doesn’t know who likely they are going to get the item that they are looking to win when they purchase said loot box.

Influencers use loot boxes thus encouraging people, especially younger players to purchase even more loot boxes and this creates a set of risks, especially since children are involved.

Few suggestions and ideas were discussed

While the workshop did a great job when it comes to identifying the problems, it wasn’t as successful when it comes to proposing solutions that’ll enable authorities to deal with the matter and eliminate them.

One of the proposed, or rather, suggested solutions is to introduce a model that will involve self-regulation as a way to curb loot boxes and their use. A new rating board should be formed and its primary concern would be rating entertainment software and disclose which game comes with loot boxes. It will also need to provide tools that’ll educate players about loot boxes.

The gambling industry is regulated heavily in comparison to loot boxes and the gaming industry as such. First of all, it is illegal for children to gamble or even register and log at a gambling site. On the other hand, they can easily spend a lot of money from their parent’s credit card and purchase a lot of loot boxes.