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Lootboxes - one of the most controversial aspects of video games today - are back in the news thanks to a new report commissioned by charity GambleAware. It was conducted by researchers at two UK universities under the title of Lifting the Lid on Loot Boxes, and offers a comprehensive analysis of several previous studies revealing some interesting and worrying truths about loot box consumption. 

Firstly, only 5% of people who buy loot boxes get half of their total loot box income, spending around £70 per month. What's more, "these players have a significantly higher rating of gambling addiction symptoms", with one third actually falling into the "problem gamblers" category. The report also says that fears that young people would be particularly vulnerable to "gambling-like harms of loot boxes" are justified. "If the harms are associated with loot boxes," the report says, "these harms could disproportionately affect children, teenagers and young adults.

Lootboxes are items that players can acquire in video games, and they can be anything from new skins and weapons to in-game characters. The controversy surrounding this phenomenon is that, unlike bet365 Nigeria sports betting, the exact contents of the lootboxes are not known until they are purchased and opened. This inherent characteristic of the loot boxes has led many critics to compare them to casino games such as online slots, and to object to the fact that gambling mechanics are cleverly built into games intended for people of all ages. This concern is exacerbated by the fact that, as the GambleAware report points out, lootboxes "often contain exciting and stretchy animations when their contents are revealed, evoking a sense of anticipation". 

In recent years, many prominent figures have spoken out unequivocally against loot boxes. Last year, NHS Director of Mental Health Claire Murdoch criticised the practice, saying: 'No company should be setting children up for addiction by teaching them to gamble on the contents of these loot boxes. No company should be selling lootbox games to children that have an element of chance in them, so yes, these sales should stop."

A few months afterwards, Lord Grade - chairman of the House of Lords gambling committee - explicitly stated that loot boxes teach children how to gamble. The committee's reports summed up the views of lootbox critics in one sentence: "If a product looks like gambling and feels like gambling, it should be regulated as gambling." 

However, there is the inconvenient and irresistible fact that lootboxes are a huge source of revenue for video game developers. A prime example is the super-popular FIFA football game series. The most popular aspect of the series among players is the Ultimate Team mode, which allows users to compile their own squads consisting of the greatest players in the history of the sport. In fact, getting these players can take a lot of time and money, and many users prefer to purchase randomised player kits, meaning loot boxes that may or may not contain valuable additions to their squads. Ultimate Team earned $1.49 billion for EA in 2020 alone, and this is just one example of how the lootbox mechanics are making huge financial gains for the game company. An estimated £36 billion by 2023 .

Given such colossal profits, it's not surprising that the games industry has faced resistance: an EA executive once described them as as cuddly and harmless as Kinder Eggs.

Such a defence has been flatly rejected by campaigners, politicians and health professionals, and legal action has been taken against lootboxes in Europe. Back in 2018, Belgium ended the debate by declaring that loot boxes "violate gambling laws". This came after the Belgian Gambling Commission scrutinised some of the games most associated with lootboxes, including FIFA and Overwatch. Failure to comply with the law by removing lootbox features could lead to huge fines and even jail time for publishers, and this shift has caused radical changes to some games. For example, EA no longer allows players in Belgium to buy FIFA Points, the in-game currency used to buy Ultimate Team kits. The Netherlands has also passed a law restricting lootboxes.

As fears remain just as acute - as evidenced by the publication of this horrifying new GambleAware report - it's only a matter of time before other countries follow suit? The British government is currently reviewing outdated gambling laws dating back to 2005, which means that the UK may at least be ready for a crackdown. But even the authors of the GambleAware report have sounded a note of caution, highlighting how ambiguity and nuance in the debate can make it difficult to develop workable laws. "The problem for the EU," the report said, "is that gambling laws themselves have yet to be agreed, and lootboxes are in any case inappropriate for gambling legislation. 

Many will argue that, frankly, there is no option but to scramble to draft this law, because industry self-regulation and the general softer approach adopted so far are not working. 

A few years ago, FIFA started displaying 'pack probabilities' on their Ultimate Team lootboxes so that users would have an idea of the chances of getting a great player for their money. However, many have expressed annoyance at the inaccurate percentages provided by EA - indeed, the system is less clear than the carefully verified player return rates displayed in licensed online casinos. And while video game rating board PEGI has rolled out warning labels for games that include lootboxes, the measure has also been criticised for doing little to prevent children and teenagers from being exposed to such mechanisms. 

According to the GambleAware report, such approaches "are unlikely to reduce the risks associated with rootboxes. They are either ineffective or poorly implemented. So it's not surprising that such efforts have also failed to thwart increasingly vocal calls for political action."

The bottom line is that, as Amanda Atkinson of the Young Gamblers and Gamers Education Trust puts it, "today's young people are clearly more exposed to gambling than previous generations" as they are always "one click away from the online gambling galaxy". For this reason, the debate over loot boxes and regulation of loot boxes may be just the tip of the iceberg, and it may only be a matter of time before each country has to make difficult and even draconian decisions to curb the problem of gambling among the majority of them. 

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