Since the beginning of mass-marketed video games in the 1970s, gamers would go to the store to purchase a game like Pong, Super Mario Brothers, or Call of Duty, contained on a cartridge or disc.
But over the past few years, video games have moved their games online, charging gamers for downloads – and additional downloadable content.
A proposal before the Illinois General Assembly would require video game developers to warn players of the financial and psychological risks of a particular in-game microtransaction – “loot boxes”.
“Loot Boxes” are random digital items that enhance a player’s gameplay, such as unlocking weapons, or change a player’s aesthetic.
However, State Rep. Barabara Hernandez (D-Aurora) thinks many young gamers may not realize that the virtual currency they use to purchase additional content, like loot boxes, is tied to real money, so kids can rack up big bills.
“Sometimes parents aren’t aware of this and they’re charged upwards of a hundred [dollars]…or sometimes thousands of dollars,” Hernandez said.
Hernandez proposed adding a warning label on loot boxes to physical video games purchased from physical stores and to video games purchased from online marketplaces or smartphone app stores. The label would read:
The message will appear each time a player purchases a loot box.
In August 2019, the Federal Trade Commission hosted a panel discussion on the rise of random price options and other microtransactions in video games and whether these practices were deceptive.
In a staff report released last August, the FTC detailed suggestions from individual panelists who called on distributors to self-regulate and clearly disclose to gamers the exchange rates between real money and virtual money and the chance of winning valuable prizes.
Last April, the Entertainment Software Rating Board – a “non-profit self-regulatory organization that assigns age and content ratings for video games” such as “E” for everyone and “M” for mature – added warning labels to games that incorporate loot boxes.
Contrary to Hernandez’s proposal, the ESRB warning does not appear multiple times in-game and does not refer to a player’s tendency to become addicted, only that items purchased from loot boxes are random.
Tara Ryan, vice president of state government affairs at the Entertainment Software Association — a video game trade association that represents major distributors like Activision Blizzard, Bethesda, Capcom, Electronic Arts and Epic Games — said the Warning label offered specifically for Illinois was unnecessary and a solution in search of a problem.
Ryan said that since the ESRB started placing warnings on loot boxes, only 3% of games still use them in their gameplay and many have become more transparent about the chances of winning a rare prize.
Ryan also said that in addition to existing warning labels, many video games already allow parental controls on loot boxes and other in-game expenses.
“These tools allow parents to set all types of controls for games, including how much a child can spend, if any,” Ryan said. “So you can set limits, or you can set a default of zero.”
Ryan also wasn’t sure how Illinois could enforce such a policy that would only impact Illinois customers, especially since the proposal makes no mention of financial penalties for distributors who don’t. do not incorporate the original warning message into their games.
“They are global companies,” Ryan said. “If it’s happening in Illinois, companies have to make decisions about shipping games to Illinois and making those changes or refusing to ship games to Illinois…if that’s something that going to pop up in the middle of their games, is this something they think will interfere with the gameplay? »
According to the ESA, there are over 8,000 jobs in Illinois directly or indirectly related to the video game industry.
Ryan also pushed back against the idea that loot boxes were linked to gambling addiction.
“We don’t believe there’s any research that shows there’s a causal link between buying something like [loot boxes] and addiction,” Ryan said.
However, at the FTC roundtable, David Zendle, a researcher from York St. John’s University in England, gave a presentation on a study he conducted that indicated there is a correlation between addictions game and loot boxes.
Zendle’s survey-based study included a sample of more than 7,000 participants aged 18 and older.
“We know that one of the main pathways to problem gambling is a process of conditioning, through which the player comes to need and expect the excitement associated with winning gambling,” Zendle said. “So we think one of the possible explanations for this effect is a situation where people buy a loot box, get excited, buy a loot box, get excited, buy a loot box, get that reward, get that shot. .. Therefore, spending money on loot boxes literally gets people into the game, which leads to problem gambling. “
Zendle said that while his study could not prove causation, the correlation between gambling addictions and loot boxes is concerning.
Rep. Hernandez said while she doesn’t want to outright ban the practice of loot boxes — a move some European countries have taken — she wants parents to know about the potential risks.
“I want them to know that there are in-game purchases in hopes of saving them from a financial burden, but at the same time it could lead to a gambling habit at a young age,” said Hernandez said.
Hernandez’s proposal rolled out of the House in April and could be heard in the Senate later this month.
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