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Sunday, September 26, 2021

UK Gambling Commission releases report on youth gambling and loot boxes

After the CSGOLotto scandal brought loot boxes under the magnifying glass and Belgium’s decision to declare loot boxes as gambling, many countries have begun looking into this issue as the law catches up with technology. The UK’s gambling commission have published a report looking at youth gambling and the possibility of this being linked to loot boxers. Although some studios have begun listing the probability of getting each item in said loot, box many still decide to keep this information hidden from the consumer. Surely any loot box which costs real money, and does not guarantee you will get the item you want, is gambling in every sense of the word.

Many believe loot boxes constitute gambling with Belgium leading the charge in outlawing them

I have to admit I am disappointed in this report. It doesn’t appear to see opening loot boxes as gambling. After reading the report it doesn’t appear they were even looking at this issue. Anyone who knows anything about how loot boxes work, would likely describe it as gambling albeit a softer form than many are used to seeing gambling as.

The report lists various statistics regarding youth gambling and loot boxes. Some good examples of these are:

• 31% have ever opened loot boxes in a computer game or app, to try to acquire in-game items, while 3% claim to have ever bet with in-game items (so called ‘skins’ gambling)
• 14% of 11-16 year olds had spent their own money on gambling in the past week (that is, the seven days prior to completing the survey), up from 12% in 2017 but still lower than rates seen prior to 2017
• 5% of 11-16 year olds have spent their own money on online gambling in the past 12 months, but only 1% have done so in the past week

Loot boxes are made as enticing as possible with many similarities to fruit machines and online casinos

Now being that this is a report looking into youth gambling, which in the UK is against the law why does it matter that 31% or 3.1% have ever opened a loot box in a video game. The games industry is deliberately making the opening of loot boxes as enticing as possible. Everything from the opening sequences, sound effects and bright colours used in today’s loot boxes, draw a scary parallel from that seen on fruit machines and online casinos. Whatever the percentage, under 18’s opening loot boxes should be frowned upon.

It doesn’t look like the United Kingdom will be taking any action around loot boxes anytime soon. There is however a little good news hidden in this report regarding in-game skins/items and gambling sites such as we saw with CSGOLotto. The report states that where in-game items have a real world valve attached, if you wish to run a site providing gambling services, where these items take the place of money you require a license to be on the right side of the law.

‘Skins’ are in-game items, used within some of the most popular video game titles. They provide cosmetic alterations to a player’s weapons, avatar or equipment used in the game. Skins betting sites allow video gamers to wager cosmetic items rewarded in-game or purchased for real money on a digital marketplace, accessible from the UK for several years. The Gambling Commission takes the view that the ability to convert in-game items to cash, or to trade them (for other items of value) means they attain a real-world value and become articles of money or money’s worth. Where gambling facilities are offered to British consumers, including with the use of in-game items that can be converted into cash or traded (for items of value), a gambling licence is required. Tackling operators making gambling facilities available to children is one of the Gambling Commission’s priorities. This has been demonstrated by action taken against unlicensed websites providing facilities for gambling using in-game items as methods for payment.

No more CSGOLotto or similar gambling sites using skins to circumvent gambling laws in the UK. What is your opinion on loot boxes and specifically young people buying/opening them?

View the full Gambling Commission Report here

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