Loot boxing bout: how Star Wars and Kinder Eggs kicked off a gambling debate

On Monday 8 June, the Department for Digital, Culture, Media and Sport (DCMS) announced that it would explore the impact of loot boxes in relation to gambling-like behaviour and the dangers the practice posed to children, with a potential ban in the offing.

In the era when an individual is labelled either an absolutist or a prohibitionist, murky, grey and clouded areas are forced into a definitive pigeonhole. Loot boxes find themselves in these chasms, between a harmless added facet of fun to casual gaming or a gateway to problematic gambling behaviour and corruption.

The key node of loot boxes that link them to gambling is their randomness. Players are not guaranteed specific prizes based on monetary value and will not be aware of what they have won until the transaction is complete.

Belgium became the first country to outlaw loot boxes based on its connection to gambling in 2018, after two leading playable characters, Darth Vader and Princess Leia, were only available via loot boxes in Star Wars Battlefront II.

EA, as well as producing the aforementioned Star Wars game, develops the popular FIFA series, in which players can purchase packs across various price points to unlock players to use in its Ultimate Team (FUT) feature. Earlier this year, two Paris-based lawyers launched lawsuits against EA, arguing the studio had implemented gambling functionalities into its title in an “illusionary” system, according to one of the lawyers, Victor Zagury.

Zagury went on to lambast the practice, arguing it facilitates children gambling. He told French publication L’Équipe: “We believe that a gambling game has been integrated into this video game because buying packs is nothing more than a bet. It is the logic of a casino that has entered their homes. Today, an 11- or 12-year-old can, without any restriction, play FUT and commit money.”
For the UK government, the coronavirus-enforced lockdown exacerbated the importance of unpacking the implications of loot boxes, and they emphasised their commitment “to tackling issues around loot boxes in response to serious concerns about this model for in-game purchasing”.

Caroline Dinenage MP, minister for digital and culture, says: “During the coronavirus pandemic, we have seen more people than ever before turn to video games and immersive technology to keep them entertained and to stay in touch with friends and family.

“These innovations can present challenges though as well as opportunities, which is why we are taking the necessary steps to protect users and promote the safe enjoyment of this dynamic industry,” she added.

Serve and protect

Protection and safety are obviously paramount when dealing with children at-risk from gambling, as Brand Architects managing director Harry Lang tells EGR Intel: “There’s no equivocation – loot boxes in their current guise are a gambling device.”

Lang continues to draw comparisons between the two and argues that chasing a win from a loot box is no different to casinos or sports betting. He adds: “[The] behavioural evolution of a player trying to win a certain type of skin to someone chasing down that skin with their last available funds is no different to somebody becoming hooked on scratchcards or slots. The user journey is so similar it’s familial.”

Dr Paul Cairns from the University of York, who started to research the relationship between gambling and loot boxes following a café conversation with a former student, Dr David Zendle, says the comparisons are far more fluid than Lang delineates.

Cairns tells EGR Intel: “For a start, loot boxes are not just one thing. There is a huge range of loot box mechanisms and then there is the problem of what constitutes gambling. Loot boxes aren’t like tobacco. There isn’t one single ingredient that’s the problem. So, where do you draw the line? Different countries have different legal definitions, which has meant Belgium moved quickly to ban loot boxes whereas the UK did not.”

Belgium outlawed loot boxes in 2018, with publishers facing up to five years in prison and an €800,000 (£728,657) fine for flouting the regulations, with penalties potentially doubled if minors are involved. Following an investigation by the Belgian Gaming Commission, Justice Minister Koen Geens slammed loot boxes for their impact on children.

Geens said: “Mixing games of chance and gaming, especially at a young age, is dangerous for mental health.” While Belgian Gaming Commission director Peter Naessens added: “Loot boxes are not a harmless part of video games that present themselves as games of skill. Players are tempted and misled by this and none of the gambling protection measures are applied.”

Blanket ban?

Both Lang and Cairns stop short of calling for a similar blanket ban on loot boxes, instead hoping for a collaborative effort between government and publishers to produce a framework that allows for responsible and regulated practice.

“I think a regulatory framework that protects children from learning addictive behaviour and controls the marketing of loot boxes to consenting adults would be adequate,” Lang says. “Add to that the need for infrastructure from developers to protect players at risk of problem gambling, and I believe you have a sustainable and pragmatic solution.”

Cairns continues: “I don’t think outlawing is simple or sufficient to prevent the relationship between loot boxes and problem gambling behaviours that we are seeing. Some sort of legislation leading to restrictions of how loot boxes work and are presented in games is necessary to address a very real correlation that we are seeing.”

Some publishers, such as Fortnite creators Epic Games, have taken the decision to remove loot boxes from their games before any potential legislation leaves them in a legal limbo, with Lang suggesting they have “jumped before they were pushed”. He continues: “They’ve seen which way the wind’s blowing; they want to defend their bedrock demographics. I’d like to pretend it was an ethical call, but I suspect it was a commercial one.”

However, while the likes of Epic Games take the proactive approach, others continue to set up camp on the loot box ‘hill-to-die-on’, including EA legal VP Kerry Hopkins, despite the Belgian moment.

In June 2019, some 14 months on from Belgium outlawing loot boxes, which stemmed from an EA title, Hopkins told UK MPs that the feature is “quite ethical and fun” and compared the purchases to buying a Kinder Egg.

Cairns rejects this with gusto, stating: “What makes loot boxes different from Kinder Eggs is that digital products like this don’t run out, they don’t need to be physically bought at a shop and no one intervenes in your purchase. The result is that loot boxes can be bought at a volume and a velocity in a way that no physical product could or would be allowed to be by responsible sellers.”

The lackadaisical comparison of a gambling product to a piece of confectionery, which in this instance are both targeted at children, highlights the slow entrenchment of gambling into the lives of young people. Lang and Cairns both warn of the danger of sustained, unregulated loot box practices.

Lang says: “The fact is that when they find a rare and desirable skin, they’ll get the same rush as someone scoring an accumulator at the races. This kind of addictive behaviour is sometimes very hard for people to unlearn.”

While he notes there isn’t yet a definitive answer and further long-term study is required, Cairns adds: “Our work has shown that there is a correlation between how much people spend on loot boxes and the severity of problem gambling behaviours.”

With the UK heading for the deepest recession in living memory as a result of Covid-19, an industry that contributed £2.6bn in 2018 may be given enough leeway to continue to blur the line between harmless fun and problematic gambling. We now wait for the DCMS-shaped Kinder Egg to reveal all.