Loot boxes have successfully evaded regulation from the U.S. Government, so far. But as the video gaming transaction rises in popularity, it has found itself faced with a new, possibly more powerful opponent: Google.
The search engine giant and overseer of Android phones’ software has decided to make games that offer loot boxes in its Google Play Store disclose their odds. Apple made a similar move with its App Store back in 2017.
Loot boxes—sometimes called loot crates—operate by offering a player a chance to get in-game items. They can either be weapons to use in a game, skins the players can equip their characters with, or other items, like power-ups. While many games have some form of in-game transaction that unlock specific items or new areas, loot boxes typically randomize the experience, allowing players to get some collection of items, but not revealing exactly what items are included.
Take gaming phenomenon Fortnite. Before it joined the mobile gaming world, the massive, multi-player shooter featured loot boxes in its Save the World co-op mode. It was sued over the loot crate practices, leading publisher Epic to provide a more transparent buying experience. Now Fortnite offers battle passes, which allow players to get a bundle of items, rather than buying each one individually. They also get to see exactly what they’re paying for.
Purchasing a random collection of items with unknowable odds has put loot crates in the spotlight, with many calling it a form of gambling. The issue first gained attention in late 2017, around the release of the game Star Wars Battlefront II.
The inclusion of the loot boxes in the Disney-owned, EA-developed title created a massive uproar throughout the already vocal gaming community. While not the first time a game featured the loot box model, the Star Wars title was the first time it garnered significant attention. Eventually the game dramatically overhauled its approach to loot boxes, and it’s since become common for a publisher to announce that upcoming games would not feature loot boxes.
In order for a game to be considered gambling, it needs consideration (which means a purchase or monetary buy-in of some kind), a prize, and an element of chance. Because they are randomized, loot crates clearly have the element of chance, and unless they can be earned through gameplay, they require that players purchase them with money—whether it’s real or in-game currency.
The question of whether loot boxes constitute gambling mostly depends on if their digital contents are a ‘prize.’ In terms of gambling, prizes are something of value, and there has yet to be a consensus on whether in-game items have worth in the real world, because they only exist digitally and can’t be used elsewhere. Some argue that people’s willingness to spend money—be it directly or indirectly through in-game currency—proves they have inherent value.
Beyond Google’s move, there’s a bill making its way through Congress that would ban the sale of loot boxes to minors. The Protecting Children from Abusive Games Act would regulate games that both target minors and employ pay-to-win mechanics.
While regulation against loot boxes in video games hasn’t completely caught on in the U.S., other countries have taken them on in various ways. In 2017, China required companies to disclose the odds of winning items, similar to Apple and Google’s approach. And in 2018, Belgium officially labelled loot crates as a form of gambling. As a result, game companies have either removed loot boxes from their titles, or removed the games entirely from the country’s market. In addition, the Netherlands made transferable items—digital goods that could be transferred to other players or exchanged for currency, for example—illegal, after a 2018 study was released.
With video games mostly associated with consoles and PCs, Google and Apple may not be the most obvious loot crate fighters. But, increasingly, developers are formatting existing games or franchises for mobile, or creating new games entirely for the platform. And as mobile gaming continues its fast growth, the tech giants are clearly deciding to step in and police their own platforms. It’s a smart play, because government regulators will have the next turn, and they may declare that it’s game-over for in-app gaming purchases.