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Armenius
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Over the past few days the Federal Trade Commission has been holding panels with industry representatives and consumer advocates to discuss the issues with loot boxes and potential solutions to consumer concerns. During one panel, several game companies represented by the Entertainment Software Association announced that they will require odd disclosures on all their games starting in 2020, including Sony and Microsoft gamesindustry.biz reports.
https://www.gamesindustry.biz/artic...microsoft-to-require-loot-box-odds-disclosure
In an update to the above article, a list of those companies participating in disclosure and those notables who are not is provided.
Consumer advocates from Consumer Reports, the National Council on Problem Gambling, and Common Sense Media shot back at both the ESA and ESRB the following day, arguing that odds disclosures was not enough.
https://www.gamesindustry.biz/artic...rb-ftc-loot-box-odds-disclosure-is-not-enough
Both articles are quite extensive and definitely worth the read. The second article highlights compelling arguments for those who have been vehemently defending the business practice of loot boxes since they don't technically fit the legal definition of gambling.
https://www.gamesindustry.biz/artic...microsoft-to-require-loot-box-odds-disclosure
Entertainment Software Association chief counsel of tech policy Michael Warnecke announced the news this morning at the Federal Trade Commission's Inside the Game workshop on the loot box issue. The comments came after Warnecke recapped the industry's previous attempts to address loot box concerns: an in-game purchases label on retail titles and platform-level spending controls on consoles and the EA Origin PC storefront.
"That said, we are doing more," Warnecke said. "I'm pleased to announce this morning that Microsoft, Nintendo, and Sony have indicated to ESA a commitment to new platform policies with respect to the use of paid loot boxes in games that are developed for their platform. Specifically, this would apply to new games and game updates that add loot box features. And it would require the disclosure of the relative rarity or probabilities of obtaining randomized virtual items in games that are available on their platforms.
"As well, many of the leading video game publishers of the Entertainment Software Association have decided that they are going to implement a similar approach at the publisher level to provide consumers this information and give them enhanced information to make purchase decisions."
"That said, we are doing more," Warnecke said. "I'm pleased to announce this morning that Microsoft, Nintendo, and Sony have indicated to ESA a commitment to new platform policies with respect to the use of paid loot boxes in games that are developed for their platform. Specifically, this would apply to new games and game updates that add loot box features. And it would require the disclosure of the relative rarity or probabilities of obtaining randomized virtual items in games that are available on their platforms.
"As well, many of the leading video game publishers of the Entertainment Software Association have decided that they are going to implement a similar approach at the publisher level to provide consumers this information and give them enhanced information to make purchase decisions."
In an update to the above article, a list of those companies participating in disclosure and those notables who are not is provided.
Update: The ESA has provided more details on the loot box disclosures, saying that platform holders are targeting to implement them in 2020. The trade group released a list of its member companies that have pledged to release loot box disclosure odds on all new games by the end of 2020. That list includes Activision Blizzard, Bandai Namco Entertainment, Bethesda, Bungie, Electronic Arts, Microsoft, Nintendo, Sony Interactive Entertainment, Take-Two Interactive, Ubisoft, Warner Bros. Interactive Entertainment, and Wizards of the Coast.
Some notable ESA member publishers who haven't made such a commitment include 505 Games, Capcom, CI Games, Deep Silver, Disney Interactive Studios, Epic Games, Focus Home Interactive, Gearbox Publishing, GungHo, Intellivision Entertainment, Kalypso, Konami, Magic Leap, NCsoft, Natsume, Nexon, Rebellion, Riot Games, Sega, Square Enix, THQ Nordic, Tencent, and Marvelous.
Some notable ESA member publishers who haven't made such a commitment include 505 Games, Capcom, CI Games, Deep Silver, Disney Interactive Studios, Epic Games, Focus Home Interactive, Gearbox Publishing, GungHo, Intellivision Entertainment, Kalypso, Konami, Magic Leap, NCsoft, Natsume, Nexon, Rebellion, Riot Games, Sega, Square Enix, THQ Nordic, Tencent, and Marvelous.
Consumer advocates from Consumer Reports, the National Council on Problem Gambling, and Common Sense Media shot back at both the ESA and ESRB the following day, arguing that odds disclosures was not enough.
https://www.gamesindustry.biz/artic...rb-ftc-loot-box-odds-disclosure-is-not-enough
That wasn't good enough for Consumer Reports' director of financial policy Anna Laitin. Her presentation came second, and centered on the argument that the goal of microtransactions in general, including loot boxes, is for people to purchase them, and that companies will use "subtle tactics" to manipulate players into buying more of them. Because of that, she said, simply letting consumers know that the purchases exist in a game isn't enough.
"There's a label for 'in-game purchases,' and that can mean a huge range of things. That's everything from, 'You can buy a new character when it's released,' to 'We have surprise loot boxes.' A whole, wide range. I know when I look at a game, there's a lot more detail that consumers need to understand how they might be presented with the option to spend money."
...
Next up was Keith S. Whyte, the executive director of the National Council on Problem Gambling (NCPG). He opened by noting the many similarities between loot boxes and gambling, specifically slot machines, saying that "whether or not loot boxes meet criteria for a gambling device in a particular jurisdiction, and whether or not players recognize or understand the risks, additional consumer protection features must be put in place to prevent users from developing gambling problems."
That protection, he said, was especially important for high-risk groups such as men, youth, and active military as well as veterans, all of whom statistically have higher risks of gambling addiction. Whyte noted that the issues go both ways, with problem gamblers being more inclined to make in-app purchases, as well as people who make in-app purchases potentially being more likely to take up gambling.
...
Last to speak was Ariel Fox Johnson, senior counsel for policy and privacy at Common Sense Media. She began by focusing in on the issues with children playing games with microtransactions included, noting that especially young children are still learning to differentiate between play money and real money -- something that is made even more challenging when games obfuscate how much things really cost. Even when the transaction amount is clear, other factors such as the relative lack of friction to make such a purchase or the fact that the dollar amounts appear small ($0.99 purchases made many times as opposed to one very large purchase once) can confuse or trick children into spending more than they intend, or without thinking.
Johnson highlighted known tactics used by companies as well to get children to spend more money, such as using matchmaking to pair older players with younger players, who would then spend money to better compete with the older players. Or, in another example, having characters on-screen appear to be upset when children do not make an in-game purchase.
"There's a label for 'in-game purchases,' and that can mean a huge range of things. That's everything from, 'You can buy a new character when it's released,' to 'We have surprise loot boxes.' A whole, wide range. I know when I look at a game, there's a lot more detail that consumers need to understand how they might be presented with the option to spend money."
...
Next up was Keith S. Whyte, the executive director of the National Council on Problem Gambling (NCPG). He opened by noting the many similarities between loot boxes and gambling, specifically slot machines, saying that "whether or not loot boxes meet criteria for a gambling device in a particular jurisdiction, and whether or not players recognize or understand the risks, additional consumer protection features must be put in place to prevent users from developing gambling problems."
That protection, he said, was especially important for high-risk groups such as men, youth, and active military as well as veterans, all of whom statistically have higher risks of gambling addiction. Whyte noted that the issues go both ways, with problem gamblers being more inclined to make in-app purchases, as well as people who make in-app purchases potentially being more likely to take up gambling.
...
Last to speak was Ariel Fox Johnson, senior counsel for policy and privacy at Common Sense Media. She began by focusing in on the issues with children playing games with microtransactions included, noting that especially young children are still learning to differentiate between play money and real money -- something that is made even more challenging when games obfuscate how much things really cost. Even when the transaction amount is clear, other factors such as the relative lack of friction to make such a purchase or the fact that the dollar amounts appear small ($0.99 purchases made many times as opposed to one very large purchase once) can confuse or trick children into spending more than they intend, or without thinking.
Johnson highlighted known tactics used by companies as well to get children to spend more money, such as using matchmaking to pair older players with younger players, who would then spend money to better compete with the older players. Or, in another example, having characters on-screen appear to be upset when children do not make an in-game purchase.
Both articles are quite extensive and definitely worth the read. The second article highlights compelling arguments for those who have been vehemently defending the business practice of loot boxes since they don't technically fit the legal definition of gambling.
