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Video Game Rewards Fit the Definition of Gambling

“Loot boxes” in video games meet the structural and psychological criteria for gambling, according to a comment piece published in Nature Human Behaviour.

“Essentially, a loot box contains one or more random rewards that alter the game in some way,” write Dr Aaron Drummond of Massey University and Dr James Sauer of the University of Tasmania. “Rewards may allow players to personalize aspects of the in-game aesthetic (for example, alter their avatar’s appearance) or improve their in-game performance (for example, via powerful weapons). Possessing rare game rewards is therefore highly desirable. Of particular interest is the increasing trend to allow players to purchase loot boxes using real-world currency.”

Loot boxes are a relatively recent and increasingly common feature in video games, and have been criticised for their similarities to gambling. Concerns have been raised regarding their impact on younger gamers, with adolescents being most at risk for developing problem behaviours as a result of early gambling exposure.

Drummond and Sauer analysed 22 games released in the past 2 years that allow players to purchase loot boxes for real money and are rated as appropriate for audiences 17 years old or younger by the Entertainment Software Rating Board (ESRB). They scored each game according to five characteristics that distinguish gambling from other risk-taking behaviours and are common to most gambling activities. They also considered whether winnings could be converted into real money, which some legal definitions of gambling require.

The researchers found that all 22 games allow players aged 17 or younger to engage with loot boxes, with ten fitting all of the structural and psychological criteria for gambling. In five of the games, players could also cash out their winnings through third-party websites or the distributor’s marketplace. (However, the publishers of four of these five games explicitly prohibit the trading or resale of virtual currencies in the games’ terms of use).

Six of the games that met the criteria for gambling — and all of the games where players can convert their winnings into cash — were rated as appropriate for 13-year-olds or younger.

The authors concluded with a series of recommendations for regulators depending on the extent to which a video game’s particular loot box fits the definitions of gambling. For example, they suggest that the recommended minimum age of these games should be raised, and that “ESRB and other ratings agencies adopt additional parental advisory information detailing loot-box mechanics in video games to help consumers and parents make informed decisions”.