Gaming and gambling have increasingly come into question. Many games have been criticized for including betting features or items which can be purchased with real money – this practice may harm young people or lead to addiction.
Issues raised here highlight the need for further research in this area, despite government attempts at banning it. Gaming companies are encouraging consumers to self-regulate themselves.
Gaming as a platform for social change
Gaming has emerged as a mainstream form of entertainment, drawing audiences worldwide. Due to its interaction with real-world issues and popularity among many media outlets, such as The New York Times and CNN. Video game industry still faces considerable social challenges when it comes to impact. Though diversity and representation efforts have made strides forward, much of its criticism stems from its offbeat, anti-establishment nature. Some of the harshest critics of gaming come from within the gaming industry itself. One notable criticism has been sexism and harassment of women gamers that has been widely reported in media reports. Asi Burak of Games for Change believes gaming should adopt a more artistic approach to address these concerns.
Loot boxes have recently generated debate in video game circles due to their similarity to gambling; critics assert they resemble illegal forms of gambling for minors in the US; however, gaming industry officials maintain their voluntary nature makes these purchases distinct from gambling.
No matter their legality, loot boxes have reignited calls for regulation. Should courts deem loot boxes gambling products, this could result in significant revenue losses for gaming industry while leading to misdiagnosis and inadequate treatment of people suffering from gambling addictions.
Gaming as a form of gambling
Gaming and gambling were once distinct activities, but thanks to technological innovations they are gradually merging together. Social games such as poker and slot machines are being sold as part of an overall gambling offering; and some video games include loot boxes with random rewards of variable value that can be purchased with real money; this has led some critics to claim these loot boxes are similar to gambling, leading to addiction or problem gambling issues.
Some governments have responded to these concerns by proposing increased regulation. Unfortunately, however, these initiatives are moving slowly and have hit roadblocks; Hawaii for instance proposed legislation which requires game companies to publish the odds associated with earning certain rewards and this issue has proven challenging for lawmakers during a government shutdown period.
Researchers from the Universities of Plymouth and Wolverhampton recently issued a joint report calling for better regulation of loot boxes in the UK. Citing research which revealed loot boxes are structurally and psychologically similar to gambling products, this research-backed proposal suggests they be labeled accordingly, have age restrictions applied and disclose odds in full disclosure. Lastly, authors suggested games offer tools allowing players to limit spending voluntary.
Gaming as a form of entertainment
Loot boxes have recently garnered the ire of both regulators and media critics as they draw players’ attention with virtual goods rewards that reward players in games like Loot Boxes – prompting accusations of addiction or gambling and calls for regulations that could significantly change gaming as entertainment activity.
Though many governments have yet to classify loot boxes as gambling, they pose a considerable threat to the gaming industry and could cost billions of dollars in lost revenues should someone decide to reclassify them as such.
With more people becoming immersed in gaming, the boundaries between gambling and entertainment have become increasingly fuzzy. This convergence has led to hybrid gambling activities adopting features similar to gaming while adopting gaming-like characteristics (King & Delfabbro 2016).
Policymakers and regulators are finding it increasingly challenging to distinguish activities between gambling and other forms of entertainment, like video gaming. Some games use variants of roulette wheels to award players with rewards; this has raised concerns that such activities constitute gambling; some lawmakers have demanded regulation for this sector, yet gaming industry representatives maintain that these new features provide mere entertainment rather than any form of gambling.
Gaming as a business
As video gaming continues to gain in popularity, companies are incentivized to find risk-averse ways of creating value for shareholders and employees. Unfortunately, these practices have led to controversy regarding loot boxes – which some claim encourage gambling addiction in gamers – that reflects minority gaming experiences but highlight a need for increased consumer protection. As a response to this criticism, some developers have moved away from loot boxes towards alternative forms of monetization such as battle passes.
Independent studies have concluded that loot boxes resemble gambling and could lead to behavioral problems including problem gambling. Academics and advocacy groups have made calls for gaming companies to ban or heavily regulate this practice; government has considered three approaches, such as improved industry-led protections or legislative changes regarding gambling laws.
Government policy toward gambling activities will largely depend on their assessment of risks involved with such activities, and recent reevaluations by the Justice Department has brought this topic back into the forefront; yet, its effect is yet to be seen. Gaming companies should remain mindful of their consumer obligations and any potential changes in gambling policies as a precautionary measure.