Real Danger of Loot Boxes Still Unknown, Gambling Commission Says

"We are clear if that risk comes from a product jumping over that line, and becoming gambling, we'll take action"

'Star Wars Battlefront II'

Even if players aren't technically gambling, video games and their use of loot boxes and microtransactions may still pose similar threats to children that real world gambling will, the UK Gambling Commission recently told Eurogamer. What this means for the future, and how big the threat actually is, is hard to tell as of right now. 

"In relation to loot boxes specifically, the key thing here is the loot boxes we've seen, none of them contain a facility to be able to cash-out within the game itself, and that's really the key thing which is preventing them from crossing that line into becoming gambling," executive director of the UK Gambling Commission Tim Miller told the outlet. 

Though there's concern over the risk of these in-game items posing threats to children where they're using real-world money without understanding the implications of what they're doing, they're still not recognized as gambling. According to Eurogamer, while attending the charity Gamble Aware's annual conference, there was a lot of talk about games and their use of gambling mechanics. But there was no word from developers, the ones implementing these systems. 

"It's really important we get to hear that voice," Miller said. "Do they share the concerns that us and others share about the potential risks that could come from some computer games?"

"I guess, just thinking of our experience in the gambling industry, we've been very clear with the gambling industry that one way to prove you can be trusted is to treat your customers well - to not take advantage of them, to understand their concerns and to act on them," Miller said. "The same should apply to any product or service, and so if the computer games industry wants to look at some of the ways we've been working with the gambling industry to improve the deal consumers get, we are always very happy to share those experiences. But treating your customers well really has got to be at the heart of that."

It's worth pointing out, it's not always clear whether or not the inclusion of loot boxes and microtransactions is a decision made by a game's developer, publisher or both. Miller says the Gambling Commission hasn't had extensive contact with many developers about the issue. 

"The best way to keep children safe, and protect them, is for everyone with an interest, everyone with a product which might be accessible or marketed to children, to recognize their role in that," he said. "Actually if all of us, whatever sector we work in, whether we're a regulator, a company, a casino, whatever we are, if we can actually all work together with the shared goal to try and keep children protected then we will have greater success in making things safer for children."

Miller adds he's not exactly sure if the real risk of these types of mechanics, as well as free-to-play mobile type games, is known yet. 

"I think in this particular environment, not just loot boxes, but if we look at free-to-play gambling-style games, social gaming, they may not amount to gambling in a legal sense, but do we really understand enough about what the consequences are," Miller said. "Learning those sorts of behaviors, getting involved in those sorts of activities, is an environment where the risks aren't necessarily as apparent or as clearly presented. So, with regulated gambling we have very clear rules in place to make sure there is clear messages around responsible gambling, around safe gambling.

"Of course none of that exists if you open a loot box, if you play on free-to-play casino style game. There will be some of the same behaviors and same activities, yes you may not necessarily be gambling with real money, but the activities have a similar feel to you the user. We just don't quite know enough about what this could mean in the future. Are we, in effect, creating an environment where young people can be exposed to gambling-style behaviors without necessarily knowing the risks and what will that mean for the future?"

A recent report by the UK Gambling Commission found children as young as 11-years-old have gambled in video games in some form. 

"I think we will be careful not to draw any definite conclusions from the first year, but there's stuff in that data that raises further questions, which I think really makes the argument that we need to have much better researching in this area," Miller says about the findings. "A lot of research is carried out in relation to children and gambling, actual gambling in the legal sense. There's a real lack of research being done into children and gambling style activities."

"I'm a parent myself and actually, from a parent's perspective, it really doesn't matter whether something meets some legal definition of gambling or not," he said. "The concern that parents have, and indeed others would have, is whether there's a product out there that's potentially posing a risk to children and young people. We are clear if that risk comes from a product jumping over that line, and becoming gambling, we'll take action."

The talk around loot boxes and microtransactions has been on the tongue of a lot of people in the game industry. EA chief financial officer Blake Jorgensen recently said the company is committed to games-as-a-service, saying it helped players better engage with games for a longer time. However, when the EA-published Star Wars Battlefront II came out, it was met with immense backlash over what many saw as an egregious use of pay-to-win mechanics. After the Star Wars IP owner Disney sided with players over the issue, Jorgensen told investors loot boxes may not return to the game.