FTC To Hold August Workshop On Consumer Issues Related To Loot Boxes
The FTC’s promised public workshop on loot boxes and will take place on August 7, 2019, the agency announced today, with game industry representatives, consumer advocates, trade associations, academics, and government officials coming together to discuss the marketing and sale of in-game purchases “and the potential behavioral impact of these virtual rewards on young consumers.”
The workshop, “Inside the Game: Unlocking the Consumer Issues Surrounding Loot Boxes,” will bring together a variety of stakeholders, including industry representatives, consumer advocates, trade associations, academics, and government officials to discuss concerns regarding the marketing and use of loot boxes and other in-game purchases, and the potential behavioral impact of these virtual rewards on young consumers.
Loot boxes are in-game rewards that contain a random assortment of virtual items (“loot”) to assist a player in advancing in the online game or to customize his or her game avatar. Players buy loot boxes using virtual currency that they may earn within the game or purchase with real money. Loot boxes have produced a growing revenue stream for game developers. At the same time, concerns have been raised about techniques used to market loot boxes and whether minors are becoming addicted to these in-game purchases.
Loot boxes of various sorts have been kicking around in games for years, but they blew up (in a bad way) in 2017 with EA’s Star Wars Battlefront 2. Since then, debate has raged over whether they constitute gambling and should be regulated as such. Major publishers and game rating agencies including the ESA and PEGI say no, but numerous government agencies have strongly disagreed. Belgium and the Netherlands were among the first nations to crack down on them; the US agreed to look into the matter, by way of an FTC investigation, in late 2018.
Some publishers have reacted to the tightened regulations by changing how they handle loot boxes, but only in the countries where it’s been specifically mandated: Blizzard disabled Overwatch and Heroes of the Storm loot boxes in Belgium, for example, while CS:GO loot cases can no longer be unlocked by players in Belgium and the Netherlands. Others, like EA and Epic, have taken a broader-but-softer approach by revealing the drop rates of loot boxes before they’re purchased.
Topics this workshop will cover include:
- The in-game transaction landscape, including the origins and evolution of loot boxes and their role in game play and the digital marketplace;
- Research examining consumer behavior, including child and adolescent behavior, in the context of video games and digital transactions; and
- A discussion of consumer awareness and education about in-game digital transactions, including the mechanics, marketing, and financial commitments associated with loot boxes.
FTC staff seeks public input in advance of the workshop, including possible discussion topics and potential participants. The public can submit suggestions for potential workshop topics and participants through June 7, 2019, via email at <a staff also welcomes written comments on the issues discussed at the workshop. Public comments should be submitted online by 11:59 pm ET on October 11, 2019. If you prefer to file a written comment on paper, write “Video Game Loot Box Workshop” on your comment and on the envelope and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue, NW, Suite CC-5610 (Annex B), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street, SW, 5th Floor, Suite 5610 (Annex B), Washington, DC 20024.
The FTC is accepting suggestions for other potential workshop topics at firstname.lastname@example.org until June 7, and will also accept comments on the topic at regulations.gov until October 11. The workshop will also be open to the public, if you’re going to be in Washington DC on the appointed date. Full details are available at ftc.org