JESHOOTS.COMRecently, the Entertainment Software Rating Board (ESRB), which is a self-regulatory organization for the video game industry, declared that loot boxes in video games are not considered gambling, mostly because they do not fit into the modern legal definitions of gambling. Unfortunately, the current state of affairs for the video game industry has enabled microtransactions to sneakily insert themselves as digital gambling systems under the noses of industry regulators.
For the uninformed, microtransactions are essentially any in-game purchase with real money in exchange for digital rewards. Loot boxes, hence, are earned (or purchased) boxes with randomized loot that can grant anything from cosmetic customization items to gameplay enhancements. If you receive a duplicate item, you are rewarded with virtual currency to directly spend on the items themselves, however your income is deliberately minimal to encourage purchases with real money. While most microtransactions involve cosmetic items that have no impact on gameplay, more and more games are featuring options that grant incremental gameplay bonuses (see: Star Wars: Battlefront II) or entire aspects of gameplay (see: Middle-earth: Shadow of War) that objectively advantage certain gamers over others, encouraging more “pay-to-win” scenarios, especially in competitive multiplayer settings.
As despicable and greedy as some of these practices may sound, this is what the modern gaming industry has become in the eyes of the broader gaming community. Its short-term financial benefits are hypnotic to executives and investors and trends have adjusted to fit this new “market trend.” Mobile gaming was the first modern popularization of microtransactions in video games. Since mobile apps are usually quite cheap in store, developers needed to find alternative ways to make money after launch. What they came up with is the “freemium” business model, where games that are technically “free,” but need in-app purchases to make the gameplay practically viable. These games can limit your playtime per day unless you purchase more time, or making obtaining special items extremely difficult or impossible without the purchase of premium in-game currency. Among myriads of reasons, mobile gaming has mostly been condemned by the core gaming community as predatory gambling for children. While there is some merit to the usage of microtransactions for free or inexpensive gaming apps, there is absolutely no defense for their inclusion into high-budget, premium $60 video games, despite its defense from industry executives or the inaction from industry watchdogs.
The argument that ESRB presents for defending loot boxes is at once straightforward and yet also foolish, as they liken the loot box system to collectible trading card packs, where you can purchase packs that have a chance to contain a rare card or other cards that you already own. However, the key difference is that trading cards are physical, tangible items that are exchangeable and worth real money. Virtual items can be purchased with real money but, more often than not, are restricted to within the game and have no real currency exchange in the real world. Loot boxes and, by extension, microtransactions have become this virtual black hole where overzealous whales or irresponsible young gamers could sink hundreds or thousands of dollars for essentially lines of computer code. This only encourages the practice even further as they infiltrate their way further and further into the core game design, with cheap investments and higher returns glistening in the eyes of executives and investors.
Talking about the corporate greed and shortsightedness of the video game industry, I’m morbidly reminded of the North American video game crash of 1983. The phenomenal boom of the nascent video game industry pushed manufacturers and publishers to ignore quality standards or sustainable business models and, as a result, they flooded the market with inferior games and home consoles. The result was the worst decline of the industry in its relatively young history, one that almost threatened to wipe out video games altogether. I see a similar situation beginning to boil today with microtransactions and loot boxes. Constructing gameplay systems like gambling systems, locking content behind paywalls within premium ($60) games, and reinforcing anti-consumer behaviour throughout the industry. It’s not legally speaking “gambling,” but it goes without saying that it is gambling. If microtransactions are indeed the unavoidable future of video gaming, then the only recourse is to encourage and advocate government regulation and intervention before the industry swallows itself whole once again.
