The trend of big companies offering away top-notch games that could have previously sold for $60 and then persuading players to spend substantial money on upgrades to increase their enjoyment or provide a competitive edge is probably the greatest development in recent years. In-game “loot boxes” are one of the most popular strategies.
The term “loot boxes” is a colloquial terminology that refers to software elements that commonly appear in video games and give the player randomized virtual goodies.
For players to interact with or “open” the loot box, they must meet “eligibility criteria”. This may be done by eliminating a certain in-game adversary, acquiring a specific virtual object, seeing embedded advertisements, or—more importantly—by making a purchase with real-world money.
Online videogames that feature loot boxes are, in essence, virtual games of chance that can be purchased.
What are loot boxes?
Loot boxes are gaming mechanics that frequently offer the player randomized virtual gifts. Given that some loot boxes accept real-world payment, they resemble gambling in both structure and psychology.
The normal loot box’s random contents are only revealed after you pay an average of $3 for it. In essence, you’re taking a chance to find something cool.
Similar to the wide selection of slot games available, crates, cases, chests, bundles, and card packs are more examples of comparable virtual in-game commodities that can be purchased.
The virtual objects that can be “earned” range from simple customization options (i.e., cosmetic) for a player’s in-game character (avatar) to in-game resources that can help players advance more quickly in the game (e.g., gameplay improvement items such as weapons, armor).
Due to the chances of winning “rare” products are so slim, all players desire to do so and are frequently urged to spend more money to do so.
How much is spent on loot boxes?
According to a publication made by market researcher Newzoo, global video game sales increased by almost 20% in 2020 to a record $175 billion as a result of millions of gamers staying home all year long and spending countless hours in front of screens to pass the time.
In only a few years, according to Newzoo’s projection, the worldwide video game market will be valued at roughly $218 billion. In the third quarter, U.S. video game sales increased by 24% from a year earlier to $11.2 billion.
In contrast, the Digital Entertainment Group reports that in 2020, Americans spent roughly $22 billion on streaming movies and other video-on-demand material.
Loot boxes similarity to slot machines
According to a study made by St. John’s University in New York, the loot boxes can be compared to inserting quarters into a slot machine. And as a result, buying loot boxes (or their equivalents) should be classed as a form of gambling. After all, spending a lot of money on a chance to win virtual goods is common.
Nonetheless, the purchase of loot boxes is not seen as gambling by individuals working in the video game industry.
However, loot boxes are a game of chance. In the game world, the prizes you can win have a perceived value, which is very similar to making money in the real world.
The side B of the loot boxes
Within the next two years, according to a new forecast, gamers will spend approximately $50 billion yearly on loot boxes.
And that is not the only problem. The other side of the coin is that this casino-like behavior is being taught to children who are being raised to gamble on a chance to win virtual goods.
For this reason, it’s a problem that other nations are already tackling seriously. For instance, a recent poll revealed that nearly two-thirds of British lawmakers favor tighter regulation of loot boxes.
In 2019, Missouri senator Josh Hawley sponsored legislation that would outlaw the sale of loot boxes to children. However, it is still standing.