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UK government gives response to lootbox regular/gambling questions/inquiries

atpbx

Member
It’s to do with the legal definition of gambling.

The contents of loot boxes are fundamentally worthless, they have no monetary value, ie it’s not giving you £10 or £20 when opened.

Therefore, it’s not gambling.

That’s the hang up.
 
As annoying as loot boxes can be, how are they any different to something like pokemon/yu-gi-oh/sports cards, various arcade machines & other child orientated toys? Other than being digital, it's essentially the same principle, yet those aren't considered gambling.

Largely, my problem is a lack of transparency that they aren't screwing with the customer, e.g. by manipulating drop rates.

It came up in a previous thread, and some gaffers looked in to it, that most if not all the Pokemon/Yugioh/Magic/etc packs had the rates at which you got rarer cards printed directly on the booster pack.
 

Stiler

Member
To me it's not an issue about getting something of monetary value, it's about how it affects your brain and the addiction that it can lead to in some people.

Loot boxes and spinning the "RNG" wheel in hopes of getting that rare item affect your brain the same way putting a quarter in a slot machine and hoping for that big jackpot does.

That's why I think the ESRB/Pegi etc should put labels on the games that have lootboxes and such, inform the parents how it can affect their brain and lead to addictions, this seems feasible and like the right thing to do to me.
 

Bert

Member
My problem with this line of thinking is that agencies across the world, who are staffed by industry experts, have access to legal counsel, and have access to large amounts of data on player behaviours as well as recent peer approved behavioral studies have all come to a conclusion that a vocal minority don't like based on "feels".

I mean... there are enough horrific political decisions being based where people declare that their feels overrule informed experts on a subject.

So... politicians never get things wrong?

Every person in the world has access to data and research, don’t make them all well informed.

Throwing the word feels in doesn’t an argument make. It’s just an appeal to authority fallacy. Experts disagree, politicians don’t always take the right advice or any advice at all. People aren’t rational beings. Even the smartest get things wrong. Expert opinion has in the past determined that we consist of “humours”, that the sky is really painted onto a dome, that black people are intrinsically worse than white people and that bitches be crazy because their wombs go wandering around their body. To assume that where we are now is somehow unique in human history in that those with access to the best knowledge available are never wrong is naive in the extreme.
 

malfcn

Member
I think they need to at least show chances, drop rates or whatever.

If they want to equate them to packs off cards for example, those have published numbers.

The esrb has the description of "simulated gambling" with virtual dollars.

Card packs, loot boxes and gambling are all a few degrees away from each other.
 

LordofPwn

Member
Loot boxes continue to not be gambling so stop calling it gambling and just ask for classification, visibility, and disclosure of drop rates.

People calling them gambling are wrong and fail to understand what gambling is. I want there to be identifiers on a game box that it contains in game purchases, and most people would like there to be disclosed drop rates on these things. these things are for consumer awareness.
 

LordRaptor

Member
3.17 doesn't seem to jive with your "fuck yeah lootcrates" stance.

The way I read that, every game with random rewards in return for real money is subject to gambling legislation as soon as someone figures out how to create a third-party marketplace for it (e.g. by selling accounts).

Thats not a fair representation of my stance, but yes, the report concludes that if a hypothetical webuyanycrate.com existed that could take lootcrates out of peoples inventory and convert it directly into cash, lootcrated would then be gambling and the site performing such an action should be regulated as a bookmakers.

Because it also - correctly IMO - identifies that with digital products, there can in fact be three entirely seperate entities involved; an agent that converts money into digital currency, a game that accepts digital currency, and an agent that converts digital currency into money.

eg that Valve are not liable for regulation as a gambling site due to the actions of third party sites that would trade skins for cash.

e:
If your contention is that there is some hypocricy in my stance that I do not consider something gambling, unless you can flip it for cash which then is gambling, and that in the first state there must at some level a concept of gambling to allow the second state to occur, I disagree, because the compulsion of gambling is inherently based on stakes, just as any risk : reward mechanism is.

For the same reason I do not consider a game of streetfighter to be inherently - at some level - gambling, yet I can reconcile that with the notion that placing a bet on the outcome of a match of streetfighter is inherently gambling.

So... politicians never get things wrong?

No, it is that legislation without full consideration of an issue or that ignores expert consensus is almost always the wrong thing to do.
 
It's not gambling, but it requires regulation.

I feel like it's one of those things that will have to live or die by consumers...not the government. I don't think you want to open this can of worms just because you are afraid of what might happen.

It’s to do with the legal definition of gambling.

The contents of loot boxes are fundamentally worthless, they have no monetary value, ie it’s not giving you £10 or £20 when opened.

Therefore, it’s not gambling.

That’s the hang up.

This point blank period.
 
3.17 doesn't seem to jive with your "fuck yeah lootcrates" stance.

The way I read that, every game with random rewards in return for real money is subject to gambling legislation as soon as someone figures out how to create a third-party marketplace for it (e.g. by selling accounts).

I think 3.17 and the subsequent sections are just stating that a loot box cannot possibly be gambling if there is no way for the user to get a cash payout. If it is possible, then the easier it is to cash out, the more likely it is to be regulated as gambling. Which makes sense to me. It's a spectrum. They're not going to care if one person manages to sell their entire account to a friend. But if a developer includes a sell for cash button right on the results screen next to each item after you open a box, then yeah that's gambling.
 

LordRaptor

Member
I think 3.17 and the subsequent sections are just stating that a loot box cannot possibly be gambling if there is no way for the user to get a cash payout. If it is possible, then the easier it is to cash out, the more likely it is to be regulated as gambling. Which makes sense to me. It's a spectrum. They're not going to care if one person manages to sell their entire account to a friend. But if a developer includes a sell for cash button right on the results screen next to each item after you open a box, then yeah that's gambling.

I mean, I could be wrong, but I think he's saying "If a thing can turn from not-gambling into gambling just by adding a 'cash out' button, it must at some level be close to gambling in the first place" which I disagree with because you can pretty much "make things interesting" for any activity by adding a wager to it.
 

Azusa

Member
So in 2015 they did a research about social gaming. Its about apps/facebook or other online games. F2P or paid.

http://www.gamblingcommission.gov.uk/pdf/Social-gaming-January-2015.pdf

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It’s to do with the legal definition of gambling.

The contents of loot boxes are fundamentally worthless, they have no monetary value, ie it’s not giving you £10 or £20 when opened.

Therefore, it’s not gambling.

That’s the hang up.

Which in my mind is what makes it even worse than gambling.

Gambling has been proven to have a very strongly addictive element to its mechanics, and so the introduction of betting real money only raised the chances of a compulsive gambler ruining their life.

Lootboxes on the other hand exploit all the same mechanics and psychological effects of gambling, and yet provide literally zero opportunity for the compulsive gambler to actually win anything of any real-world value. It's the gambling institution's wet dream, because you persuade people to bet with real money on the chance to win literally nothing.

For me, all this highlights is that the legal definition of gambling needs a adjustment, as the lack of real-world value of winnings do nothing to lessen the chances of a compulsive gambler ruining their lives/finances.

Clearly, what keeps the user of these systems playing, is the mental value the player assigns to the items they're attempting to win. So whether those winnings are virtual items or real world currency, regardless of whether the Law considers them to have value, the player (who is the one taking the risk) clearly does... surely that should be what matters—since it is this that is being exploited.
 

Principate

Saint Titanfall
I mean, I could be wrong, but I think he's saying "If a thing can turn from not-gambling into gambling just by adding a 'cash out' button, it must at some level be close to gambling in the first place" which I disagree with because you can pretty much "make things interesting" for any activity by adding a wager to it.
I mean yeah but this case the activity fits the dictionary definition of gambling (even with money involved) but not legal.

Money is going in and someone is profiting from the misfortune but there's no money coming out.

Which honestly I don't see how that's better for anyone involved outside from the company in question.
 
Which in my mind is what makes it even worse than gambling.

Gambling has been proven to have a very strongly addictive element to its mechanics, and so the introduction of betting real money only raised the chances of a compulsive gambler ruining their life.

Lootboxes on the other hand exploit all the same mechanics and psychological effects of gambling, and yet provide literally zero opportunity for the compulsive gambler to actually win anything of any real-world value. It's the gambling institution's wet dream, because you persuade people to bet with real money on the chance to win literally nothing.

For me, all this highlights is that the legal definition of gambling needs a adjustment, as the lack of real-world value of winnings do nothing to lessen the chances of a compulsive gambler ruining their lives/finances.

Clearly, what keeps the user of these systems playing, is the mental value the player assigns to the items they're attempting to win. So whether those winnings are virtual items or real world currency, regardless of whether the Law considers them to have value, the player (who is the one taking the risk) clearly does... surely that should be what matters—since it is this that is being exploited.

The bolded is kind of head-scratching. The thing that makes something like gambling for money at the casino as dangerous as it is to me rests entirely on the fact that you're betting money directly to win money. The danger is that there's an inherent risk of just digging oneself deeper and deeper into the hole thinking that they can "win" their way out of it. Like if I just get paid today and decide that I've got X amount of spending money for the next two weeks and decide to gamble it all at the boat, that's bad. If I lose all that money and decide I really don't want to spend the next two weeks walking to work and eating ramen noodles and decide to gamble my rent money, that's worse. If I lose my rent money and decide I'm completely fucked if I don't win it back and then start taking out cash withdrawals against my credit card(s), I could be venturing down the path of ruining my entire life.

Now I get that some of the same fallacious reasoning that applies to casino gamblers can prey on a f2p gacha game player (or loot crate game I guess). That "I've already lost this much I can't quit now" sunk cost fallacies or the gambler's fallacy ("I'm due for a win") can still affect people. But there isn't precisely that same draw that all of this can be undone if I can just get lady luck on my side for a bit. Like if I buy $1,000 of orbs in Fire Emblem Heroes (a gacha game I'm familiar with if you're wondering why I'm bringing it up) and don't get the hero I want, just because I'm convinced that I'll finally get it on this next $20 worth of orbs certainly won't get me out of this hole. I mean, yes, I might get that sweet hit of digital ecstasy by "winning," but I'm also down $1,020 now. Nothing I do in this game is going to change all the money I've lost. Whereas if I'm at the boat, all I have to do to get out of the hole is put $1,000 on black and I'm back to even, baby!
 
Which in my mind is what makes it even worse than gambling.

Gambling has been proven to have a very strongly addictive element to its mechanics, and so the introduction of betting real money only raised the chances of a compulsive gambler ruining their life.

Lootboxes on the other hand exploit all the same mechanics and psychological effects of gambling, and yet provide literally zero opportunity for the compulsive gambler to actually win anything of any real-world value. It's the gambling institution's wet dream, because you persuade people to bet with real money on the chance to win literally nothing.

For me, all this highlights is that the legal definition of gambling needs a adjustment, as the lack of real-world value of winnings do nothing to lessen the chances of a compulsive gambler ruining their lives/finances.

Clearly, what keeps the user of these systems playing, is the mental value the player assigns to the items they're attempting to win. So whether those winnings are virtual items or real world currency, regardless of whether the Law considers them to have value, the player (who is the one taking the risk) clearly does... surely that should be what matters—since it is this that is being exploited.

I think you're making a big assumption that "the lack of real-world value of winnings do nothing to lessen the chances of a compulsive gambler ruining their lives/finances." I agree that developers can and do every thing they can to make random items as desirable and limited as possible. I just don't think that the compulsion to get a swimsuit Mercy skin or whatever will ever be as high as the compulsion to win cash.

Edit: which was explained in the post above
 

Principate

Saint Titanfall
The bolded is kind of head-scratching. The thing that makes something like gambling for money at the casino as dangerous as it is to me rests entirely on the fact that you're betting money directly to win money. The danger is that there's an inherent risk of just digging oneself deeper and deeper into the hole thinking that they can "win" their way out of it. Like if I just get paid today and decide that I've got X amount of spending money for the next two weeks and decide to gamble it all at the boat, that's bad. If I lose all that money and decide I really don't want to spend the next two weeks walking to work and eating ramen noodles and decide to gamble my rent money, that's worse. If I lose my rent money and decide I'm completely fucked if I don't win it back and then start taking out cash withdrawals against my credit card(s), I could be venturing down the path of ruining my entire life.

Now I get that some of the same fallacious reasoning that applies to casino gamblers can prey on a f2p gacha game player (or loot crate game I guess). That "I've already lost this much I can't quit now" sunk cost fallacies or the gambler's fallacy ("I'm due for a win") can still affect people. But there isn't precisely that same draw that all of this can be undone if I can just get lady luck on my side for a bit. Like if I buy $1,000 of orbs in Fire Emblem Heroes (a gacha game I'm familiar with if you're wondering why I'm bringing it up) and don't get the hero I want, just because I'm convinced that I'll finally get it on this next $20 worth of orbs certainly won't get me out of this hole. I mean, yes, I might get that sweet hit of digital ecstasy by "winning," but I'm also down $1,020 now. Nothing I do in this game is going to change all the money I've lost. Whereas if I'm at the boat, all I have to do to get out of the hole is put $1,000 on black and I'm back to even, baby!
I fail to see what's different. Do you think the massive revenue generation by gacha games in the mobile sector is by chance?

The argument that digital items hold less value to people than money becomes more fallacious as we go on.

People care a lot an out those digital items this is no longer even a theoretical question anymore the stats speak for themselves.
 
I fail to see what's different. Do you think the massive revenue generation by gacha games in the mobile sector is by chance?

The argument that digital items hold less value to people than money becomes more fallacious as we go on.

People care a lot an out those digital items this is no longer even a theoretical question anymore the stats speak for themselves.

Right, but I'm trying to talk about how the traps work. I'm not saying that absolutely nobody out there possesses the kind of addictive behavior that would allow them to fall victim to gacha or loot crap, but that the risk-reward is wildly different between the two. Like, I'm not arguing that gacha stuff is fine because it's worthless anyway and if you lose your money gambling on it that's your problem, but that I can't possibly see how it's worse just given that more people would obviously be drawn to winning money. Further, the fact that you're gambling to win money can cause even worse short term judgment simply because your ability to wipe out your losses is always potentially just one lucky day or possibly even one bet away.
 

LordRaptor

Member
I mean yeah but this case the activity fits the dictionary definition of gambling (even with money involved) but not legal.

I mean... I still disagree, because it is conflating a figurative meaning with a literal one.

Like... if I don't like coffee revels, its 'gambling' to buy a pack of revels, and end up with more coffee revels than other flavours but its not gambling.
But if a mate says "Bet you a tenner you get more coffee revels than any other flavour in that pack" that then is gambling.

I just don't think that the compulsion to get a swimsuit Mercy skin or whatever will ever be as high as the compulsion to win cash.

I agree, the stakes are much lower, which means the risk is much lower, which means the thrill is much lower.
 

nynt9

Member
I think you're making a big assumption that "the lack of real-world value of winnings do nothing to lessen the chances of a compulsive gambler ruining their lives/finances." I agree that developers can and do every thing they can to make random items as desirable and limited as possible. I just don't think that the compulsion to get a swimsuit Mercy skin or whatever will ever be as high as the compulsion to win cash.

Edit: which was explained in the post above

Exactly. Like Steve put it here:

The bolded is kind of head-scratching. The thing that makes something like gambling for money at the casino as dangerous as it is to me rests entirely on the fact that you're betting money directly to win money. The danger is that there's an inherent risk of just digging oneself deeper and deeper into the hole thinking that they can "win" their way out of it. Like if I just get paid today and decide that I've got X amount of spending money for the next two weeks and decide to gamble it all at the boat, that's bad. If I lose all that money and decide I really don't want to spend the next two weeks walking to work and eating ramen noodles and decide to gamble my rent money, that's worse. If I lose my rent money and decide I'm completely fucked if I don't win it back and then start taking out cash withdrawals against my credit card(s), I could be venturing down the path of ruining my entire life.

Now I get that some of the same fallacious reasoning that applies to casino gamblers can prey on a f2p gacha game player (or loot crate game I guess). That "I've already lost this much I can't quit now" sunk cost fallacies or the gambler's fallacy ("I'm due for a win") can still affect people. But there isn't precisely that same draw that all of this can be undone if I can just get lady luck on my side for a bit. Like if I buy $1,000 of orbs in Fire Emblem Heroes (a gacha game I'm familiar with if you're wondering why I'm bringing it up) and don't get the hero I want, just because I'm convinced that I'll finally get it on this next $20 worth of orbs certainly won't get me out of this hole. I mean, yes, I might get that sweet hit of digital ecstasy by "winning," but I'm also down $1,020 now. Nothing I do in this game is going to change all the money I've lost. Whereas if I'm at the boat, all I have to do to get out of the hole is put $1,000 on black and I'm back to even, baby!

The reason gambling is dangerous because some perceive it to be a situation where they can get positive monetary value out of it, no matter how deep they are in already. It's an endless loop. Whereas with loot boxes, you will ALWAYS be at further and further negative monetary value. You can NEVER get money back out. So there is no reward loop of trying to get your money back. There is no deception that one can fall into that will lead to them losing infinite money with a promise of the next win. Additionally, there are a finite amount of rewards you can earn from loot boxes. You'll eventually run out of things to buy or do in the game. Whereas with gambling, you can always gamble more.

As a corollary of these significant differences, the reward loop of loot boxes is inherently way less addictive, and the maximum damage one can do to their own money is significantly different.
 
Its the Eurogamer article that says they are uninformed as op-ed, that doesn't automatically mean that they are.
Given they cite a commision report from March of this year that specifically involved investigating virtual currencies that nobody (including myself) seems to have been aware of or brought up in any of these discussions.... who is actually uninformed here?

e:
Because reading this report right now


"LOL WHATS A LOOTCRATE AMIRITE?" seems an unfair response

Yep. I still disagree that loot creates are gambling and am shocked (not really) that folks automatically went the "old people don't understand" angle.
 

Principate

Saint Titanfall
Right, but I'm trying to talk about how the traps work. I'm not saying that absolutely nobody out there possesses the kind of addictive behavior that would allow them to fall victim to gacha or loot crap, but that the risk-reward is wildly different between the two. Like, I'm not arguing that gacha stuff is fine because it's worthless anyway and if you lose your money gambling on it that's your problem, but that I can't possibly see how it's worse just given that more people would obviously be drawn to winning money. Further, the fact that you're gambling to win money can cause even worse short term judgment simply because your ability to wipe out your losses is always potentially just one lucky day or possibly even one bet away.

The it's worse argument comes from the reward. If you consider the addictions that drives someone to continue participating as equivalent for one you get a cash out pretty much exactly what your putting in. The chances are almost non-ecustant but they exist (which is why some casino'a escort you out if they think your winning too much).

For gacha and loot box boxes the reward is fundamentally worthless the is no winning for the user and no loss for the company. It's a game in which the house wins with 100% certainty.

I mean... I still disagree, because it is conflating a figurative meaning with a literal one.

Like... if I don't like coffee revels, its 'gambling' to buy a pack of revels, and end up with more coffee revels than other flavours but its not gambling.
But if a mate says "Bet you a tenner you get more coffee revels than any other flavour in that pack" that then is gambling.



I agree, the stakes are much lower, which means the risk is much lower, which means the thrill is much lower.
Coffee revels are an awful example almost no one is spending thousands to get those coffee revels and the percentages are completely different. There needs to a worth with which the user is willing to spends thousands for based on that chance.

If all gambling companies worked on a 50% chance do you think anyone would give a shit about their effects?
 

Zarth

Member
I feel like a broken record saying no gambling laws will apply to any game that doesn't allow you to trade or exchange the rewards from the loot box.

People really just don't wanna believe that the law is that straightforward.
 

WaterAstro

Member
I feel like it's one of those things that will have to live or die by consumers...not the government. I don't think you want to open this can of worms just because you are afraid of what might happen.

I already did in all of the other threads.

Loot boxes is a separate issue that needs to be solved or mitigated differently. Gambling and Loot boxes have similarities, but they are not the same. Some companies' loot crate implementation is gambling, like Valve with selling stuff on Steam.

I don't want people to detract actual gambling where addicts gambling are hoping to get more money to solve their problems only to create a bigger financial hole as they lose. Loot boxes addicts are just buying useless virtual goods that they can't sell and have no value. That's the key difference.
 

Principate

Saint Titanfall
I already did in all of the other threads.

Loot boxes is a separate issue that needs to be solved or mitigated differently. Gambling and Loot boxes have similarities, but they are not the same. Some companies' loot crate implementation is gambling, like Valve with selling stuff on Steam.

I don't want people to detract actual gambling where addicts gambling hoping to get more money to solve their problems. Loot boxes addicts are just buying useless virtual goods that they can't sell and have no value. That's the key difference.
They're financial problems are the same though. They use similar predatory methods.

Ultimately the end result isn't all that different.

Loot boxes aren't a heinous concept and neither is gambling frankly if the chances rewards etc were actually fair. They're not though. If they were companies wouldn't be making massive amounts of money from it the statistics wouldn't add up.

That's the problem.
 

WaterAstro

Member
They're financial problems are the same though. They use similar predatory methods.

Ultimately the end result isn't all that different.

Loot boxes aren't a heinous concept and neither is gambling frankly if the chances rewards etc were actually fair. They're not though. If they were companies wouldn't be making massive amounts of money from it the statistics wouldn't add up.

That's the problem.

You gamble hoping to win money to solve your financial problems.
You buy loot boxes hoping to get some rare virtual good that can never be helpful to your finances.

It's that simple.

I'm not saying we should ignore loot boxes. I'm saying to separate gambling and predatory game purchases for regulation.
 

nynt9

Member
They're financial problems are the same though. They use similar predatory methods.

Ultimately the end result isn't all that different.

Loot boxes aren't a heinous concept and neither is gambling frankly if the chances rewards etc were actually fair. They're not though. If they were companies wouldn't be making massive amounts of money from it the statistics wouldn't add up.

That's the problem.

The end result is very different though. Loot boxes are a finite pit that you can throw in a lot of money to, gambling is an infinite pit where you think you can get money out of it if you throw in enough money, so you keep throwing money in. You run out of money, then you keep throwing, thinking eventually you'll get some money out of the pit to pay back your debt. You can't pay back a debt with loot boxes so you'll never get stuck in that infinite loop.
 
They're financial problems are the same though. They use similar predatory methods.

Ultimately the end result isn't all that different.

Loot boxes aren't a heinous concept and neither is gambling frankly if the chances rewards etc were actually fair. They're not though. If they were companies wouldn't be making massive amounts of money from it the statistics wouldn't add up.

That's the problem.

Look at it from the point view of someone who has just spent $1000 after losing over and over and isn't feeling particularly happy about all of the money they've spent. For someone playing Overwatch, they think if I just buy one more box I could finally get the skin I want and I'll have paid $1,010 for it. For the gambler, they think one more hand and it's like all of those losing hands never happened. The chance to erase all of your poor financial decisions is a powerful draw that no loot box can match.
 

MUnited83

For you.
Look at it from the point view of someone who has just spent $1000 after losing over and over and isn't feeling particularly happy about all of the money they've spent. For someone playing Overwatch, they think if I just buy one more box I could finally get the skin I want and I'll have paid $1,010 for it. For the gambler, they think one more hand and it's like all of those losing hands never happened. The chance to erase all of your poor financial decisions is a powerful draw that no loot box can match.

People can get the skin they want without spending 1000$
 
Look at it from the point view of someone who has just spent $1000 after losing over and over and isn't feeling particularly happy about all of the money they've spent. For someone playing Overwatch, they think if I just buy one more box I could finally get the skin I want and I'll have paid $1,010 for it. For the gambler, they think one more hand and it's like all of those losing hands never happened. The chance to erase all of your poor financial decisions is a powerful draw that no loot box can match.
Which is honestly why I think marketplaces combined with loot boxes is actually more dangerous than people are willing to admit. It's seen as the better side of loot crates but it trends closer toward real gambling than otherwise. "I'm after the skin I know will go for $400 so I can buy a number of games" or "at least if I only get trash I can sell it and try and get some DLC" are more powerful motivators than "I hope I get the good skin".
 

Azusa

Member
The ๖ۜBronx;252311528 said:
Which is honestly why I think marketplaces combined with loot boxes is actually more dangerous than people are willing to admit. It's seen as the better side of loot crates but it trends closer toward real gambling than otherwise. "I'm after the skin I know will go for $400 so I can buy a number of games" or "at least if I only get trash I can sell it and try and get some DLC" are more powerful motivators than "I hope I get the good skin".

Yeah even UK Gambling Commission mentioned it in their reports. That lootbox + marketplace = gambling.
 
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