Let’s Solve Loot Boxes

Let’s not beat around the bush. Loot boxes can be fun to open, but there’s no question about their harm. Join me today in my discussion about loot boxes, gacha games, and the dangers of such predatory monetization schemes becoming a normalcy in gaming culture.

What are loot boxes and gachas?

A loot box is a digital item within a game that functions similarly to a lottery. Loot boxes themselves are free to obtain; however, a key must be bought to play the lottery. The result is usually a cosmetic item or effect of varying rarity. Once a loot box is used, another one must be obtained to play the lottery again. 

A gacha system is quite similar but circumvents having to obtain loot boxes. Players instead pay real money to play the lottery through what’s called a banner. Banners are time-limited lotteries that can be spun infinitely until the end date. Once again, the results are of varying rarity. 

Describing them using the word lottery may already tip you off as to the underlying problem, but before we discuss that, let me quickly cover an alternate result of loot boxes and gacha systems: gameplay benefits. 

This doesn’t require much discussion and the gaming community has coined the term pay-to-win (P2W) to describe games with such systems. These games are collectively looked down upon since players who don’t spend money are clearly at a disadvantage. Why play if the deciding factor between a win and a loss is the amount of money spent and not raw skill? We need only look at EA’s recent Star Wars Battlefront II for an example of community outrage. To talk more about them is to beat a dead horse and the least of the worries when it comes to loot boxes. As it turns out, there’s something far more dangerous than gameplay benefits that we haven’t caught on to yet. We’ve all seen it. We all know what it is, but whether we want to admit it or not is a different story. What else would it be but loot boxes themselves, whose fundamental design is dangerous. 

Given that loot boxes and gacha games are based entirely on chance, the possibility of developing a gambling addiction has been posed since their implementation in games. For a long time though, there was no support for that argument. All evidence was strictly anecdotal and the gaming community wasn’t going to accept what they viewed as unfounded criticism. Keep in mind that loot boxes were made popular in western regions around 2010 with Team Fortress 2’s loot crates and FIFA’s card packs. By this time, video games in general had already come under fire from people who believed it promoted violent behavior, a claim which, at the time, was unfounded. Nevertheless, those claims still affected the video game industry in a substantial way. While not mandated by the U.S. government, games like Manhunt (2003) and Grand Theft Auto IV (2008) were forced to censor themselves at the behest of the media. It’s because of this unsubstantiated call for censorship that the gaming community has an increased resistance to any outsiders that seek to tamper with the status quo. That said, loot boxes are different. A decade has passed and research has been done. It’s time to face reality. 

Is there a correlation between loot boxes and gambling? Yes, based on a number of surveys, there very well does seem to be and it shouldn’t be taken lightly (Zendle, 2019; Brooks 2019). Zendle and Cairns find that the correlation is stronger than the correlation between gambling and depression. Moreover, they state it’s comparable to the relationship between alcohol dependence and gambling (2019). This isn’t just the case of a nonzero number being presented as a correlation, it’s significant. To be fair, Zendle and Cairns do admit that it’s still unknown whether loot boxes cause problem gambling or those that are problem gamblers use loot boxes as an outlet for their disease. Yet, in the case of either answer, the data found is exceedingly relevant when we come to the big question being posed: Are loot boxes a form of gambling? 

In 2012, Japan, where the gacha term originates from, banned particular types of gachas. 

In 2016, China mandated the probability of item acquisition from loot boxes and gacha to be public. They even went so far as to demand increased rates of winning and limited the amount of loot boxes a player could buy within a day. 

In 2019, Belgium opted to have loot boxes removed from video games entirely. 

All three countries found that these monetizations schemes in games were nearly equivalent to gambling if not considering them gambling outright. While currently they’re in the minority, many other countries have expressed concerns about loot boxes. A lynchpin in the argument is that rewards from loot boxes don’t represent anything of monetary value and thus aren’t legally a form of gambling. That line of thinking in itself is problematic since research has found, even in the absence of a reward entirely, the brain still emits a reward response. What matters is the perception of winning. This indicates that there doesn’t have to be a reward, let alone one that has monetary value, for gambling to have its addictive effect (Fielding, 2017). 

Although, even if you do ignore that, there is a legally grey area: the Steam Marketplace. It’s a digital store where items from loot boxes can be traded and sold. The caveat is that the money gained from selling items can only be used in the Steam Store and shouldn’t be able to be extracted. Is this small detail all that prevents loot boxes from being constituted as gambling? More importantly, does it matter?

If we’re able to legally identify loot boxes as a form of gambling, we’re able to regulate them. That’s the logic most people are using. Unfortunately, as explained previously, the monetary value of loot box results is ambiguous. Therefore, why not tackle this solution from a different path: Self-regulation. This isn’t a stretch by any means. The video game industry is already self-regulated by the Entertainment Software Association (ESA) so what could prevent this path from being viable?

Firstly, this shortcut to solve a problem is only possible if the community agrees on the need to regulate. Secondly, the body designated to regulate must be recognized as an appropriate authority with the necessary power to enforce their regulations. The ESA is already in place to regulate video games which clears the second objective. All that remains is the first. Does the community agree on the need to regulate? No. 

“Loot boxes don’t hurt me. I don’t have a gambling disorder. I don’t even think gambling should be regulated, so why should loot boxes be? Besides, if the government thinks it’s so dangerous, let them regulate it.” 

That’s a valid argument. If it doesn’t affect you, why should you care? Why shouldn’t we let the government regulate it? My response: it does affect you, a lot more than you know. If we let the government regulate it, even more so.

I said before that loot boxes became popular in western regions around 2010. In the short timespan since then, they’ve affected game development drastically. Most AAA publishers have embraced the loot box system because they generate an exorbitant amount of money. This has had the side effect of reducing the production of AAA single-player games overall. From a publisher’s perspective, there’s little reason to make a single-player game (Nelva, 2017). They believe it’s a financial misstep and there’s truth to that. 

A single-player game is bought once and that’s the end of the story. There’s no online component and the game’s effective lifespan is however long players take to complete it. A multiplayer game is much different. You pay for the game, the online pass if you’re on consoles, and the keys to open loot boxes. The longevity is also increased since there’s literally no end to the game. You simply play matches over and over because of the reward response of winning. There’s nothing inherently wrong with that. There should be multiplayer titles, they’re obviously enjoyed. In fact, they’ve been an integral part of games since Quake (1996), whose online component is said to have sparked the first esports event. The problem lies in design goals and monetization transparency when it comes to loot boxes. 

Iterations of Quake are still being played.

Loot boxes represent a continuous stream of money that will continue to flow as long as a game maintains its player base. This intention to create a long lasting game has shifted the design goals of multiplayer games. Rather than create a product that encourages drop-in and drop-out multiplayer, studios instead focus on how to keep players playing. Normally, this wouldn’t be a problem; however, Epic Games and EA revealed in a hearing with U.K. Parliament that they don’t hire psychologists to assess whether their game design will cause harmful levels of engagement. This includes loot boxes and matchmaking.

Do some companies hire psychologists to assess this? Yes. Valve, creators of the aforementioned Team Fortress 2 and Counter Strike: Global Offensive, do hire psychologists (Valve, n.d.). That should be the industry standard, but it isn’t. In fact, there’s no industry standard, despite what people might think. The rates of getting a high rarity item in a loot box vary from game to game. Moreover, the only reason players are able to know those rates is predominantly because of the Chinese government mandating it be public in their country. If China didn’t mandate that, players would be gambling blindly. There would be no transparency between the player and the creators. 

Of course, loot boxes are a valid form of monetization. I don’t deny that. What I do disagree with is developer David Jaffe’s argument that the items within loot boxes are art and therefore the regulation of loot boxes is censorship of art. This couldn’t be farther from the truth. The items within loot boxes can be defined as art, but the regulation of loot boxes isn’t the censorship of that. His argument is based on the assumption that if loot boxes are banned, the items won’t be seen. This is incorrect as can be evidenced by how the industry provided cosmetics prior to the popularity of loot boxes: microtransactions. The player would pay a fee, usually no more than $0.99, and their account would own that cosmetic. When microtransactions became popular, there was massive backlash for hiding content behind a paywall. Loot boxes are more of the same and even worse. There’s no guarantee to get the item you want, no guarantee to get your favorite piece of art. 

This argument also highlights the lack of transparency from studios that defend loot boxes as more than a monetization scheme. We need to recognize that loot boxes are a way for companies to make money. It’s not an implementation made to increase the quality of life. I can’t put it in better words than what a member of the U.K. Parliament said in 2019,

“There’s nothing wrong with being a commercial entity, but let’s not beat around the bush… You can challenge that if you like, but that’s the reality of the situation.” 

This is a great watch. Parliament is actually really competent and there are some great questions they ask.

Despite all that, I do agree with Jaffe that regulation could lead to censorship of art. That is, I believe government regulation could lead to the censorship of video games, which are an artform. 

I mentioned the ESA before and how they regulate the video game industry. The reason they were founded was to avoid government regulation in the first place. It ties back to the claim that video games cause violent behavior in children. Back in 1992, the original Mortal Kombat (MK) game was released. It featured a special mechanic called ‘fatalities.’ These were a special kind of finishing move which caused an excessive amount of gore. They also caused worries about the portrayal of violence in games. This led to Midway Games, developer and publisher of MK, having to defend their product in court against censorship and government regulation. They successfully defended themselves, but the industry knew that unless more was done, attempts to censor future games would continue. Soon after, the ESRB and ESA were created in response. 

Do you see it now? If we don’t self-regulate, soon enough, we’ll be regulated by the government, whether we like it or not. They’ve taken interest in the industry before and it’s only a matter of time before loot boxes are considered gambling. Most gamers already consider them as such (Brooks, 2019). Therefore, whether you think gambling itself should be regulated or not doesn’t matter. When, not if, the government catches on, it’ll be out of our hands. 

If you want to protect video games, either from loot boxes, other predatory monetizations schemes, or the government, keep reading. Here on AniCourses, we always strive to solve the problem. 

Advice and Solutions

To recap, we determined that the ESA exists and would be able to regulate loot boxes. The problem is that the community isn’t in agreement or, if they are, remains silent and doesn’t actively advocate for change. Murmurs on forums and discussion boards have led the ESRB to change their rating system to include random items through in-game purchases as recently as April 13, 2020, but that’s all. That change doesn’t actually affect game development. What should you, as a player, do to help? 

1) Don’t buy loot boxes. The late John Bain, an influential figure in the gaming sphere, put it best when he talked about day one purchases and preorders, “The answer to the adoption of these policies is to keep your wallet firmly shut…” If loot boxes don’t fulfill their purpose of generating money, they’ll be removed.

2) Spark discussion on forums. Start a hashtag on Twitter. Bring to light games that have loot boxes in them and discuss if they benefit players or only the game studio. Make sure to give feedback and critique that is well-mannered. 

I can hear you asking, “Will the developer or publisher actually see this? Do they pay attention to that stuff?” Yes, they do pay attention to their forums and community feedback. They have PR and community managers dedicated to listening, even if they’re silent at times. Individual developers on the development team do so as well. Therefore, if enough people discuss, we necessitate an official response. If they don’t respond? That silence means they aren’t interested in what players think. They don’t care about you and you shouldn’t support them financially. 

Still doubtful? Once again, look at EA’s Star Wars Battlefront II. Complaints made about its loot boxes and an update was released that removed loot boxes entirely (Gilbert, 2018). In that same vein-

3) Praise single-player games that come out. Even EA, who openly expressed their intentions to focus on multiplayer-only titles, were forced to go back on that after the success of Star Wars Jedi: Fallen Order, a single-player title (Grubb, 2019; Grubb 2020). 

Are you a developer or someone who will assist with loot box regulation? Here are some ideas to work off of.

1) The safety of the players is important. As such, if a predatory monetization scheme is used, there must be safeguards in place. There must be a limit on how many loot boxes can be bought and opened within a certain timespan. 

2) Psychologists should assess whether a game will cause harmful levels of engagement, especially if predatory monetizations schemes are used.

3) If a player contacts customer support, we must learn to be lenient. Children will steal their parent’s credit card and use it to buy loot boxes. Can their parents always prove that beyond a reasonable doubt? No.

4) ESRB ratings should reflect the presence of predatory monetization schemes in a greater way. The ESRB does state that parents don’t know what loot boxes actually are and that’s their reason for not mentioning loot boxes by name, but that doesn’t solve the issue. Random items through purchases are still vague. Call it what it is: gambling.

5) The chance of getting an item within a rarity bracket should be disclosed to the ESRB and the public. This assures the rate of winning is reasonable. As for what’s classified as reasonable, I’ll leave the ESRB to determine that. 

Are you a psychologist who wants to do research on video games and how players are affected? 

1) Surveys distributed online through forums such as Reddit or other online avenues are less than ideal. If this is the route you choose, note that your results will be skewed. Surveys on the internet are mostly answered by players who game predominantly on PC and may not accurately represent console players. 

**A note to all players: please take these surveys seriously. Real research is being done using your answers. Your joke responses will have repercussions and could affect how mechanics such as loot boxes are viewed legally. 

2) Reach out to game studios for data. While not all studios hire psychologists, nearly every studio will collect data on players. This isn’t just in the case of multiplayer games. Even studios which produce single-player games do as well (Steam, 2006). 

3) An ideal way to reach console gamers specifically is by reaching out to Sony and Microsoft. The dashboard on consoles, as long as it’s connected to the internet, is capable of displaying surveys. While still too clunky for short responses or essays, multiple choice questions and questions with scaling agreement would work nicely. 

**Game developers may also host your survey on the title page of their game. The efficacy of that is questionable though and will have to be tested. 

4) In many studies, players who are under the legal age limit of gambling are not counted. This is a fatal misstep as many players are under that limit. Moreover, predatory monetizations schemes specifically target that demographic since they’re vulnerable. We must find a way to include these players.  

We’ve reached the end for today, but I encourage you to stay involved in the community. If you see dangerous practices going on, alert others. The gaming industry has expanded several times over in recent decades, but at our core, we’re still family. We look out for each other. 

If you’re still interested in the portrayal of violence in video games over time, I recommend Ahoy’s YouTube video: A Brief History of Gore. Or maybe you’re interested in game design? Check out the video How to Keep Players Engaged by Game Maker’s Toolkit (GMTK). Are you still thinking about community feedback? GMTK also made a video titled: Should Games Designers Listen to Negative Feedback

This concludes our lesson. Thank you for reading on AniCourses. 

References

Ahoy. [Ahoy]. (2014, February 2). A Brief History of Gore [Video]. YouTube.

Bain, John. [@totalbiscuit]. (2016, October 25) The answer to the adoption of these policies is to keep your wallet firmly shut when it comes to preorders and day 1 purchases. [Tweet] Twitter

Brooks, G. A., & Clark, L. (2019). Associations between loot box use, problematic gaming and gambling, and gambling-related cognitions. Addictive Behaviors, 96, 26–34. https://doi-org.ez.lib.jjay.cuny.edu/10.1016/j.addbeh.2019.04.009

Brown, Mark. [Game Maker’s Toolkit]. (2018, April 6). How to Keep Players Engaged (Without Being Evil) | Game Maker’s Toolkit [Video]. Youtube. 

Brown, Mark. [Game Maker’s Toolkit]. (2020, May 7). Should Game Designers Listen to Negative Feedback? [Video]. Youtube. 

ESRB, Introducing a New Interactive Element: In-Game Purchases (Includes Random Items). (2020, April 20). Retrieved from https://www.esrb.org/blog/in-game-purchases-includes-random-items/

Fielding, A., Fu, Y., & Franz, E. A. (2018). The Brain’s Reward Response Occurs Even Without Actual Reward! Journal of Gambling Studies, 34(2), 449–463. https://doi-org.ez.lib.jjay.cuny.edu/10.1007/s10899-017-9721-3

Frank, A. (2017, September 07). Counter-Strike gambling scandal comes to an end with FTC settlement. Retrieved from https://www.polygon.com/2017/9/7/16271520/csgo-lotto-scandal-counter-strike-betting-ftc-endorsement-guidelines

Gilbert, B. (2018, April 17). ‘We got it wrong’: EA exec apologizes for ‘Star Wars’ loot box fiasco, promises to ‘be better’. Retrieved from https://www.businessinsider.com/star-wars-battlefront-2-ea-apologizes-for-loot-box-fiasco-2018-4

Grubb, J. (2019, November 2). Electronic Arts: ‘We are doubling-down on live services’. Retrieved from https://venturebeat.com/2019/10/29/electronic-arts-we-are-doubling-down-on-live-services/

Grubb, J. (2020, February 1). Star Wars Jedi: Fallen Order made EA realize it can do more than shooters. Retrieved from https://venturebeat.com/2020/01/30/star-wars-jedi-fallen-order-10-million/

Jaffe Scott, David. [@davidscottjaffe]. (2018, November 29) The products that the loot boxes are part of are the art, genius. Not the loot boxes themselves, although I can… [Tweet] Twitter

Nelva, G. (2017, November 28). EA: Closing Visceral Games an “Economic Decision” as Players Don’t Like Linear Games As Much Today. Retrieved from https://www.dualshockers.com/visceral-games-closed-linear-games/

Steam. (2006, July 7). Half-Life 2: Episode One Update Released. Retrieved from http://web.archive.org/web/20080306061112/http://steampowered.com/v/index.php?area=news&id=681

U.K. Parliament. (2019, June 19). Immersive and Addictive Technologies. Retrieved from https://parliamentlive.tv/Event/Index/0bf5f000-036e-4cee-be8e-c43c4a0879d4

Valve. (n.d.). Psychologist, Research/Experimental. Retrieved from

https://www.valvesoftware.com/en/jobs?job_id=11

Zendle, D., & Cairns, P. (2019). Loot boxes are again linked to problem gambling: Results of a replication study. PLoS ONE, 14(3), 1–13. https://doi-org.ez.lib.jjay.cuny.edu/10.1371/journal.pone.0214167

2 thoughts on “Let’s Solve Loot Boxes

  1. Loved the post. I hadnt thought about very much regarding loot boxes. Admittedly I have spent a few hundred dollars on gacha and might be one of the luckier people not to have spent more. I am worried when my friends spent lots of money on packs for a game just to be burned and never recieve the item or unit from a game.

    I dislike gacha in general, but it is an effective monetization tool. I guess its fair to have the discussion about what is fair in regards to loot boxes. How far is too far? When does it become predatory?

    I don’t know, but as a gaming community I am sure we can find an answer.

    Liked by 1 person

    1. Yeah, I’m pretty much the same. I’ve spent quite a bit on a single game over a few years, but I’m not mad about it. I have disposable income and proper foresight. Others though? Not so much.

      I’m just hoping that this article can provide people a base to jump off of when they try and solve the issue of loot boxes and other gambling-esque things.

      Liked by 1 person

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