The Entertainment Software Association, a U.S. video game industry trade group, announced today that multiple game publishers and developers will adopt new policies regarding in-game “loot boxes,” including the disclosure of information regarding “the relative rarity or probability of obtaining randomized virtual items.”
Going forward, any game that includes paid loot boxes or similar purchases must also include the actual math regarding what can and might appear in those boxes. To put it in the language of games, loot boxes’ contents and “drop rates” must now be explicit and public information. This applies to all updates and new games that contain purchases like this, and the information must be presented in an understandable, available, and easily-accessed manner.
While no timeline has been established for the full implementation of the policy, the ESA claims that console manufacturers such as Sony, Microsoft, and Nintendo are all aiming to have the new policy in place at some point in 2020. Other ESA members that have agreed to the new policy include Activision Blizzard (Overwatch, World of Warcraft), Bethesda (The Elder Scrolls, Fallout, Doom), Bungie (Destiny 2), Electronic Arts (Madden), Take-Two Interactive (Red Dead Redemption 2, the forthcoming Borderlands 3), Ubisoft (Watch Dogs, Assassin’s Creed), Warner Brothers Interactive (Mortal Kombat), and Wizards of the Coast (Magic: The Gathering Arena).
Here’s a statement Nintendo sent to GeekWire:
“At Nintendo, ensuring that our customers can make informed choices when they play our games is very important. As part of our ongoing efforts in this area, Nintendo will require disclosure of drop rates in Nintendo Switch games that offer randomized virtual items for purchase, such as loot boxes. This requirement will apply to all new games and includes updates to current games that add loot boxes through in-game purchases. We also offer tools like our Nintendo Switch Parental Controls mobile app, which empowers parents to choose what works for their family, including managing in-game purchases and setting playtime limits.”
Sony and Microsoft have not yet responded to requests for comment; we’ll update this story when we hear back.
Loot boxes as a mechanic have been controversial for years. Many browser, social media, and free-to-play games have featured similar options, where players can use real money to purchase in-game currency, cosmetic options, or similar quality-of-life bonuses. Companies such as Zynga (Farmville) have made microtransactions a hallmark of their business model, where you can play their games for free, but you’ll be able to get through them further and faster by paying a few dollars for additional currency.
Many games — such as Valve’s Team Fortress 2 and Turbine’s Lord of the Rings Online — have switched to a similar model, where the game is technically free but paying customers get significant bonuses, and become far more profitable as a result.
Two years ago marked a tipping point, which some attribute to the success of Blizzard’s megahit team-based shooter Overwatch, where many mainstream video games — the Madden franchise, WB’s Middle-Earth: Shadow of War, Star Wars: Battlefront II — began to include a loot box or similar option as an in-game purchase.
While loot boxes typically don’t contain anything that would provide an actual play advantage, their uncertainty is meant to keep players locked into a compulsion loop, much in the same way as the hypnotic effect of a slot machine. For example, you may really want a certain costume for your main character, but it’s only found as a random drop from loot boxes, so you keep coming back and pulling on that lever until you get it. If the item you wanted was a one-time purchase, then you’d just get it and forget it, but loot boxes can keep you coming back over and over again for weeks.
As a result, loot boxes have been attracting a lot of legal attention in the last few years, as researchers and scientists have called them out as what’s effectively unregulated gambling. Players have posted multiple horror stories of spending thousands of dollars on video games, due to addiction and/or unsupervised children.
The discussion culminated in the Federal Trade Commission scheduling a public workshop for today, “Inside the Game: Unlocking the Consumer Issues Surrounding Loot Boxes,” which coincides with today’s policy announcement by the ESA. The workshop has already led to one startling piece of testimony, as per Polygon, where a video game company deliberately manipulated the odds that a loot box would pay out in order to make them look like a more attractive purchase during a promotional stream.