GambleAware has called for greater regulatory scrutiny of video game loot boxes, following research commissioned by the charity, consolidating the ‘psychological similarities between gambling and gaming.’
The charity funded a report completed by the University of Plymouth and the University of Wolverhampton, exploring the links between loot boxes and problem gambling and which demographics were more likely to engage with in-game randomised rewards.
DCMS has formally notified that the rules and standards of loot box transactions will be revised in its ongoing review of the 2005 Gambling Act.
Providing an overview of the UK market, GambleAware details that currently 93% of children play video games, with ‘up to 40% of players’ having engaged with loot boxes – a video games segment estimated to be worth £700 million during 2020.
Analysing the ‘spend data ‘of 7770 loot box players GambleAware’s report found that round 5% of purchasers generated around half of all loot box revenues – a trend akin to online casino gambling.
Meanwhile, analysing a wider pool of 14,000 video gamers, the research found that younger males and those with a ‘lower educational attainment’ were more likely to purchase loot boxes.
“Our work has established that engagement with loot boxes is associated with problem gambling behaviours, with players encouraged to purchase through psychological techniques such as ‘fear of missing out’,” stated, Dr James Close, Senior Research Fellow, University of Plymouth.
“We have also demonstrated that at-risk individuals, such as problem gamblers, gamers, and young people, make disproportionate contributions to loot box revenues.”
Carrying-out face-to-face interviews, researchers uncovered that loot box consumers detailed ‘complex and embedded motivations’ for their purchases – which included social recognition, deepening their engagement with a video game or improving gameplay factors.
Player feedback cited that the digital assets in loot boxes carried a ‘real-world or psychological value’ amongst the video-game community – a factor that could see loot boxes regulated under existing UK gambling legislation.
However, GambleAware noted that loot boxes formed part of a ‘psychological nudge’ to encourage gamers to engage with in-game purchases, alongside other techniques such as in-game currencies and time-limited offers.
Based on its findings, researchers have recommended that new policies be implemented to prevent ‘the gambling harms associated with loot box purchases’ – policies include:
- Clear definitions of loot boxes
- Game labelling and enforceable age ratings
- Full disclosure of odds presented in an easily understood manner
- Spending limits and prices are shown in real currency values.
GambleAware states that its recommendations could be instated via new regulations or changes to existing gambling laws.
Zoë Osmond, CEO of GambleAware, said: “This research is part of GambleAware’s continued commitment to protect children, adolescents and young people from gambling harms. The research has revealed that a high number of children who play video games also purchase loot boxes and we are increasingly concerned that gambling is now part of everyday life for children and young people.
“GambleAware funded this research to highlight concerns around loot boxes and problem gambling, ahead of the upcoming Gambling Act Review. It is now for politicians to review this research, as well as the evidence of other organisations, and decide what legislative and regulatory changes are needed to address these concerns.”