What Problems Are Hidden Behind Loot Boxes?

There are underlying similarities between gambling and video games in terms of strategies, skill set, and luck factor. Betting trends in the video gaming industry have helped gamblers who have self-excluded themselves from the gambling limitations.

The key similarity between gambling and video games is loot boxes which are mystery boxes offering random items. The loot box revenue for video games will reach $20 billion by the end of 2025 as per reports by Juniper Research.

Loot boxes in video games are consumable virtual items that can be redeemed for receiving a randomized selection of loot or virtual items which include items for a player’s avatar, equipment like armour, or weapons.

Loot Boxes In Relation To Gambling Activities

The loot box concept was originally developed from loot systems in multiplayer role-playing online games. Its first appearance was in 2004 through 2007 and was a part of many free-to-play as well as real money titles.

Microtransactions, where items are traded for money in video games, are quite common and generate around $30 billion in sales for application and gaming companies. Rare exclusive rewards catch the interest of video gamers.

The concept of loot boxes was criticized in the mid-2010s since there is an added advantage for players buying loot boxes over non-paying games. Loot boxes are also a part of the online gambling industry as per the research reports by The University of Plymouth and The University of Wolverhampton.

Cons Of Loot Boxes In Gambling

• Addictive In Nature: Teenagers are roped into overspending on loot boxes without being aware of the consequences. The more they invest, the more they tend to dive into a gaming addiction.
• Not Suitable For Self-Excluded Users: Problem gamblers registered under self-exclusion might choose any online casino bonus offered by the best casinos. The availability of loot boxes risks their attempt to restrict gambling tendencies and financial expenditure.
• Does Not Require Parental Supervision: Compulsive buying tendencies among children might be harmful since parents are unaware of this spending via their credit cards.

Loot Boxes In Video Games

The global gambling market has been growing rapidly and is expected to grow at a Compound Annual Growth Rate (CAGR) of 12.3% from $64.13 billion in 2020 to $72.02 billion by the end of 2021. The gambling market is expected to reach $112.09 billion by 2025 at a 12% CAGR. In brick and mortar casinos, punters receive their rewards in real life, whereas, in video games and online gambling platforms, gamblers receive virtual rewards.

• Star Wars Battlefront II: Launched in 2017, this is the 4th major instalment of the Star Wars Battlefront video game series. Developed by EA Dice along with Motive Studios, Criterion Games, this game was published by Electronic Arts and is compatible with Xbox One, Playstation 4, and Windows. This action shooter game contains loot boxes and was criticized for the same since there was favouritism towards players investing real money.
• Fifa 17 And 18: These games from the FIFA series are developed by Electronic Arts and can be accessed via Playstation, Xbox, and Windows devices. The FIFA franchise offers loot boxes for players that can be obtained by real money investment. However, due to recent controversies regarding them, these games allow punters to find out what is there inside these boxes before investing.

Problems Associated To Loot Boxes

There are multiple problems arising from the existence of loot boxes in video games. A large number of teenagers and young children are getting addicted to gambling due to the lucrative loot box option. Due to this, the UKGC is already considering whether or not to exclude loot boxes from online gambling and video games via the gambling laws. As per research commissioned by the charity GambleAware, certain factors were highlighted:

• Up to 40% out of the 93% of children open loot boxes while playing video games.
• Due to young age and lower education, children tend to use loot boxes more often
• About 5% of gamers generate around half the revenue from loot boxes

The report also mentioned that certain games use psychological nudges such as fear of losing out on limited-time items or deals to provoke players into buying loot boxes. The high rollers at online casinos spend more than $100 a month on loot boxes as per reports.

Conclusion

A total of 58% of the top video games available on Google Pay offer loot boxes whereas 59% of the top iOS video games contain loot boxes as per 2020 reports. The Steam store contains loot boxes in around 36% of top games. To be an ethical gamer, one has to be aware of the pros and cons of loot boxes in order to avoid overspending.

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