The UK Government is due to call for evidence that in-game loot boxes should be reclassified as gambling products.
The news comes from a report in The Guardian, which states that the Department for Digital, Culture, Media and Sport (DCMS) is ramping up its investigation into the monetisation practice.
Despite their controversy, loot boxes are not currently considered to be gambling in the UK, as their contents cannot officially be sold for actual currency – although some third-party websites do allow users to sell cosmetic in-game items to one another.
Speaking to MCV/DEVELOP about the story, Ukie’s Dr Jo Twist stated: “The UK games industry takes its responsibility to players of all ages seriously. We launched our Get Smart About P.L.A.Y. campaign to encourage safe and sensible play, including considering managing, limiting or turning off spend in game using family controls. We have worked constructively with Government and other organisations on a range of issues, and we look forward to continuing to do so.”
The Government has been concerned about loot boxes for some time now – in September last year, the DCMS criticised the industry for a ‘lack of honesty and transparency‘ with regards to loot boxes, and in October Anne Longfield, the children’s commissioner for England, called for tighter legislation to protect children from excessive in-game spending.
However, these complaints (and the Guardian’s report) misses a fair bit of context. First, the Guardian quotes Labour MP Carolyn Harris as stating: “They are a virtually speculative commodity that only help to normalise and encourage young people to take a chance. All too often this will lead to youngsters developing an addiction to gambling.”
This misses a few key facts, First, in April last year, the Pan European Game Information (PEGI) introduced the ‘paid random item’ descriptor to games that feature loot boxes. The disclaimer, which is being implemented by the end of the year, will make it clear to consumers that a game features loot boxes prior to purchase, making it easier for parents not to purchase these games for their children if they are concerned.
Second, in August, Nintendo, Microsoft and Sony all committed to requiring developers to disclose the probabilities of getting items in loot boxes. Both Apple’s App Store and Google Play operate similar policies. While this obviously doesn’t completely eliminate the element of chance, loot boxes are far more transparent than the Government often recognises. And with Fortnite’s popular Battle Royale mode, Call of Duty: Warzone, and hot new thing Valorant all devoid of loot boxes (or similar random mechanics) it’s certain that the industry can and has found other ways to monetise free-to-play titles.
Third, a concern that is brought up in the Guardian report is the issue of addiction. However, just 22 people have been referred to the NHS’s gaming disorder clinic (as of February 2020), out of over 34 million UK players. However, it is worth noting that the World Health Organisation does recognise ‘gaming disorder’ as an illness, but specifically avoids using the word ‘addiction.’
Finally, there is little talk in these reports about the reality of in-game spending. According to ISFE’s GameTrack data for Europe, just 36 per cent of parents across Europe allow their children to spend money in-game, and of those, over 60 per cent spend under €20 a month.
If the Government opts to reclassify loot boxes, companies will be forced to either redesign their games so they can be sold to under 18s, or remove them from storefronts entirely. This is already the case in the Netherlands, whose gaming authority considers some loot boxes as gambling. In 2017, the Belgium Gaming Commission declared that loot boxes were a form of gambling targeted at children, and called for them to be banned in Europe.
It is currently not clear what evidence the DCMS requires, or the deadline of the enquiry.