Loot boxes from video games are in the headlines again with Australia the latest country to consider them gambling. A committee wants the government to restrict loot boxes to individuals over the age of 18.
The House of Representatives Standing Committee on Social Policy and Legal Affairs states loot boxes are effectively gambling. They, therefore, threaten the well-being of vulnerable people, including children and young people.
Australia is effectively facilitating underage gambling by failing to age restrict loot boxes, the committee said. That sounds like an extreme statement, but one that rings true when you look into the loot boxes mechanics.
What Are Loot Boxes? How Do They Work?
Loot boxes have been part of video games for several years. They started as rewards for players achieving a certain level, or for playing a certain amount of time. No some claim they are a way of forcing playing to “pay to win” in certain games.
The FIFA franchise has tone of the biggest and most popular loot box system in the world. FIFA players spend hundreds of millions of dollars every year in the games FIFA Ultimate Team (FUT) game.
FUT players start with an average squad of players but can open FUT packs containing better players. Everyone wants to receive the world’s best in-game players, who match their real-life counterparts. This means the likes of Cristiano Ronaldo and Lionel Messi are most sought-after.
The problem lies in that the players contained in FUT packs are random; there’s no guarantee of receiving a superstar.
Indeed, a youngster in the United Kingdom spent almost $1,100 on his parent’s credit card without them knowing. He never “unpacked” Lionel Messi despite this four-figure spend. His parents were eventually refunded, but that’s not the point. This child had essentially gambled $1,100. He did play pokies or roulette, yet he’d gambled real money despite being 10-years-old.
Do Other Countries Consider Loot Boxes Gambling?
Belgium and the Netherlands have already ordered EA, owners of the FIFA franchise, to stop using loot boxes. EA has removed loot boxes from FIFA games played by residents of these countries.
The United Kingdom doesn’t consider loot boxes to be gambling. It does consider them to be gambling-like, however. The UK’s standpoint comes from the fact the items received in loot boxes have no real-money value outside of the game. This is true for items in games such as Red Dead Redemption 2, but it is possible in some games.
For example, players of CS:GO, a popular eSports game, feature cosmetic skins in its loot boxes. There are third-party sites where players can buy and sell items won in these boxes. Only last week a poplar Twitch streamer unboxed four rare CS:GO items while streaming his play. The items are worth $5,000 in real money to collectors. Some items command five-figure sums.
Will The Video Game Industry Fight Back?
The video game industry is absolutely massive. It is expected to be worth more than $300 billion by the year 2025. This huge sum is worth far more than the global music and film industry combined. Video games manufacturers will not go down without a fight.
Epic Games, owners of Fortnite, made more than $1 billion from in-game purchases last year. Much of this game from youngsters purchasing skins for their characters.
There is no way the video game industry will continue to take this laying down. They’ve already lost a large number of Belgian and Dutch customers. The United States is also considering banning the boxes for under 18s. Australia following suit would it would mean losing another 3.7 million potential customers. Consider the average gamer spends approximately $325 per year, that’s a whole of revenue to miss out on.