Think of loot boxes as a digital version of The Price is Right, except you have to pay for the right to see what’s behind Curtain 1—or what’s in the digital box. Such prize-laden boxes are associated with video games.
Members of parliament in the UK believe these boxes constitute games of chance, thus should be classified as gambling, subject to government regulation. Many are urging a complete ban on the sale of loot boxes to children. Instead, kids should be able to unlock the boxes with earned in-game credits.
Recommendations came courtesy of a report published recently by the Department for Digital, Culture, Media and Sport’s parliamentary committee that followed an inquiry into immersive and addictive technologies. The committee took evidence from a number of tech companies including Fortnite maker Epic Games; Facebook-owned Instagram; and Snapchat.
“Buying a loot box is playing a game of chance and it’s high time the gambling laws caught up. We challenge the government to explain why loot boxes should be exempt from the Gambling Act,” said DCMS committee chairman Damian Collins.
According to an article in Tech Crunch, the committee found representatives from the games industry to be “willfully obtuse” in answering questions about typical patterns of play, data the report emphasizes is necessary for proper understanding of how players are involved with the games. The report also accused companies of “a lack of honesty and transparency,” leading it to question what they have to hide.
“The potential harms outlined in this report can be considered the direct result of the way in which the ‘attention economy’ is driven by the objective of maximizing user engagement,” the committee wrote in a summary of the report, which explored “how data-rich immersive technologies are driven by business models that combine people’s data with design practices to have powerful psychological effects.”
The committee also interviewed game players. One competitor spent up to £1,000 per year on loot box mechanics in Electronic Arts’ Fifa series. Another reported that an adult son ran up £50,000 on microtransactions in the online game RuneScape. The maker of that game, Jagex, told the committee that players “can potentially spend up to £5,000 a month.”
In addition to calling for gambling laws to be applied to the industry’s lucrative loot box system, the report calls on games makers to protect players, saying research into possible negative psychosocial harms has been hampered by the industry’s unwillingness to share information.
“Data on how long people play games for is essential to understand what normal and healthy—and, conversely, abnormal and potentially unhealthy—engagement with gaming looks like.”
The report accused the industry of failing to sufficiently accept responsibility for these consequences. Among other recommendations, it said, the government should require game makers to share data with researchers, as well as instituting an industry levy to fund independent academic research including into “gaming disorder,” an addictive condition formally designated by the World Health Organization.
“Social media platforms and online games makers are locked in a relentless battle to capture ever more of people’s attention, time and money,” Collins said. “Their business models are built on this, but it’s time for them to be more responsible in dealing with the harms these technologies can cause for some users. Loot boxes are particularly lucrative for game companies but come at a high cost for problem gamblers, while exposing children to potential harm.”
Parliament also expressed concern over an inadequate age verification system to keep children from playing age-restricted games. One criticism finds online games not subject to legally enforceable age rating.
“All companies and platforms that are making games available online should uphold the highest standards of enforcing age-ratings,” the committee wrote.
The UK government is working with tech companies to devise a centralized system for age verification for online platforms. A section of the report cites testimony from Deputy Information Commissioner Steve Wood raising concerns about any move towards “wide-spread age verification by collecting hard identifiers from people, like scans of passports.”
Wood instead pointed the committee towards technological alternatives, such as age estimation, which he said uses “algorithms running behind the scenes using different types of data linked to the self-declaration of the age to work out whether this person is the age they say they are when they are on the platform.”
