2018 is infamous as a highly controversial year in the video gaming world due to the mass implementation of a popular business model by the biggest video game publishers out there — loot boxes. For those unfamiliar with the term, loot boxes (a.k.a. loot crates) are a virtual item which players can receive as a reward by playing most new video game titles. These chests contain different types of goodies players can utilize, such as in-game currency, cosmetics, game items for their characters, or different kinds of power-ups.
Now, you might be wondering — what is wrong with that? Isn’t rewarding players a good thing? Well, it is, but what if we told you that you could also purchase those loot boxes with real money? In essence, that wouldn’t be an issue if the rewards from these containers weren’t completely random. Yes, you’ve heard that right — the outcome of these loot boxes is as unpredictable as slot machines. That is why a lot of people consider loot boxes as a form of gambling in video games and demand that they be regulated accordingly.
Gambling Is a Lucrative Industry
The recent increase in popularity of online gambling is an excellent indicator of how profitable the industry really is. For example, the online gambling industry in America alone brings in around $20 billion annually. This number sounds quite juicy, doesn’t it? Well, video gaming giants like Activision and Electronic Arts couldn’t agree more. These two video gaming companies are the biggest proponents of loot box gambling. And let’s be real; it comes as no surprise that these corporations took this excellent opportunity to increase their revenue.
The Predatory Nature of Loot Boxes
Now, microtransactions similar to loot boxes aren’t anything new. Developers of free-to-play mobile games like Candy Crush used a similar type of business model. That way, they could remain in business, even though their products were available free of charge.
However, when full-fledged PC gaming titles leave room for players to buy loot boxes, we are left with a horde of angry consumers. The reason for that is because that course of action is considered as a perfect example of corporate greed. Namely, AAA gaming titles come with a steep purchasing price — usually not under 50 USD. And when you add to that the possibility of endlessly purchasing loot boxes, you’ve got yourself one hell of a gold mine.
Ultimately, it’s no wonder why the Hawaii state representatives labeled loot boxes as a ‘predatory practice.’
Problem Gambling in Children Is on the Rise
Sadly, it is no secret that the number of problem gamblers among children has quadrupled in the past two years, as research shows. This information comes from one of the world’s most renowned gambling regulators — the United Kingdom Gambling Commission. If you ask us, these numbers are quite alarming. So it’s not surprising that the video game industry has been taking so much flak recently.
Exposing children to gambling from an early age is the primary reason why governments from all around the world have started taking issue with the idea of loot boxes in video games. Although there is no concrete evidence of loot boxes causing problem gambling, the link between the two is undeniable. Even the UK Gambling Commission’s latest reports support that claim. And considering that the number of children who actively play video games is enormous, them being exposed to something that resembles gambling so much is a major issue. Hence, a significant number of countries have been actively trying to ban loot box gambling as of late. Unfortunately, many video gaming companies have decided to turn a blind eye to the problem at hand, at the scorn of many.
The World VS. Loot Boxes
In an attempt to combat loot box gambling, many countries around the globe have already taken steps towards regulating gambling in video games. The leaders in this endeavor are Belgium and the Netherlands. Both of these countries determined that some types of loot boxes don’t adhere to their countries’ gambling laws. Here are some of the games that feature loot boxes that were deemed illegal by these countries’ legislation:
- FIFA 18
- Counter-Strike: Global Offensive
- Star Wars Battlefront II
However, not all games were found to be in violation of these countries’ laws. How is that, you may ask? Well, it’s simple, really. Even though loot boxes are identifiable with games of chance, in some particular video games, players cannot purchase them with real money. In them, they are purely a reward for their hard work in-game. That, according to popular belief, should be the only acceptable way of implementing loot boxes in video games.
What is more, besides these two European countries, many more have been in favor of regulating or altogether banning loot boxes. For example, China and South Korea made it mandatory for developers to disclose the exact probabilities of receiving any particular reward from them. However, in 2017, China passed an even stricter law, which made multiple gaming companies retract loot boxes from their games for the Chinese market.
What Does the Future Hold?
So in the end, are loot boxes gambling? Well, there is no definite answer to that question. As you have seen, it all depends on the viewpoint and the laws of different countries. But are they a potential hazard for our youth? Yes — we can say that with certainty.
Unfortunately, even with all these countries deciding to stand up against loot boxes in gaming, this practice is unlikely to cease in the near future. However, we can remain hopeful.
In most games, loot boxes are acquired either through playing the game, in-game currency, or real money.
The rules for acquiring and unlocking loot boxes vary from game to game. What loot boxes contain also varies wildly from title to title.
In general, there are still no rules, but most of the time, you’ll be paying with either time or money for loot boxes.
The proper answer would be: “We don’t know yet.”
Regulatory bodies and lawmakers still haven’t reached a consensus on how to categorize loot boxes. There are arguments for both sides, and the jury’s still out on that question.
However, with the way the wind is blowing, it seems that loot boxes might be considered gambling soon.
It’s hard to say. We suggest judging on a game-by-game basis.
Let’s take Overwatch as an example no. 1. It contains loot boxes, but those are only filled with cosmetic items. These cosmetic items can’t be traded. The only way to profit from these boxes is to sell your account.
However, if Blizzard finds out that you sold your account, that account will be immediately banned. Although, this doesn’t stop accounts from being sold every day.
We would say that, while this could be considered unethical, this isn’t gambling.
Let’s take Counter-Strike: Global Offensive as an example no. 2. CS:GO also contains loot boxes, also filled with cosmetic items, but there is one key difference — you can sell these items on the Steam marketplace.
That makes a world of difference since you could spend $10 on a loot box and receive a $5,000 skin, which you could then sell on the marketplace.
This introduction of the Steam marketplace in the equation makes CS:GO loot boxes stray way too close to gambling territory. Especially considering there were many many (illegal) CS:GO skin gambling sites in the past.
While we would still be reluctant to call it gambling, it gets dangerously close.
In the end, it is not up to us to decide but up to the people and governments of the world.
Well, currently, there is no answer to this question.
Lately, there has been a much-heated debate about this very question. Some organizations and individuals have compared loot boxes to gambling. Due to the way games are age-restricted, those people have accused game developers of exposing minors to gambling.
Game developers, generally, tend to compare loot boxes to other products like “Kinder Surprise,” “Hatchimals,” and “LOL Surprise,” and avoid any comparisons to gambling.
However, generally, loot boxes only give in-game items which have no actual value other than to the player. The only flaw with that thinking is that certain games which contain loot boxes also have online markets where you can sell your items for real money, which additionally complicates the issue.
In essence, the regulation and lawmakers are drastically behind the times and are trying to catch up with gaming.
Basically, loot boxes aren’t gambling… yet.