Addicted to Loot: Recent Developments in Gaming Addiction and Gambling Concerns in the UK

The video games industry continues to see strong growth, both through proliferation of mobile gaming as well as a robust traditional gaming and console market. However, UK lawmakers are continuing to voice their concerns, particularly around the potential for video game addiction and the perceived link between gaming and gambling.

The ongoing inquiry into immersive and addictive technologies run by a Digital, Culture, Media, and Sport committee has been hearing evidence from a range of industry players, from developers to regulators. So far, its chair, Damian Collins MP has been sceptical of the level of care taken by the industry, which he accused of merely „paying lip service“ to the issues of gaming addiction and gambling.

Loot boxes, which provide players with the opportunity to pay to open a ‘box’ and acquire an unknown quantity and quality of in-game items for use within the game, have drawn particular scrutiny.

The UK Gambling Commission has in the past identified loot boxes as a potential risk to children and young people. However, for the purposes of UK gambling laws, a key factor in deciding whether a gaming practice crosses the line of what is and is not gambling and presents a risk to people is whether in-game items acquired “via a game of chance” can be considered „money or money’s worth“.

In practical terms this means that where in-game items obtained via loot boxes are confined for use within the game and cannot be cashed out, they are unlikely to be caught as a licensable gambling activity. This has proved controversial and there remains a lack of clarity in the area. Many parents are not interested in whether an activity meets a legal definition of gambling. Their main concern is whether there is a product out there that could present a risk to their children. The Gambling Commission is, therefore, concerned with the blur between video gaming and gambling (and, together with 14 other regulators from across Europe and the US, even issued a declaration to this effect in September 2018).

Despite this, the industry is not without its advocates. In her interactions with the inquiry, the UK Minister for Digital and the Creative Industries, Margot James MP, was keen to distinguish the UK from other countries, such as the Netherlands and Belgium, who have banned loot boxes. Speaking in July 2019, she pointed out that „Loot boxes are a means of people purchasing items, skins to enhance their gaming experience, not through an expectation of an additional financial reward. And also, more importantly, they can’t be traded offline for money“, opining that, „there are big differences, and I don’t think really it is true to say loot boxes are gambling.“

The committee has also heard from representatives of publishers such as EA (who prefer to use the term „surprise mechanics“) who suggested that the practice is more akin to purchasing Kinder Eggs than gambling and is „quite ethical and quite fun.“ Nevertheless, EA itself has drawn particular criticism over „pay to win“ concerns (regarding loot boxes which provide the chance of obtaining items which can affect in-game performance rather than cosmetic-only items) and even James has conceded that such mechanics „might be potentially more dangerous“.

Even without the challenges that gambling regulation presents, there has been growing debate around gaming addiction and the need for controls to curb excessive play time. The WHO’s classification of gaming disorder as a recognised illness last year has drawn further attention to this subject. The WHO defines ‚gaming disorder‘ as ‚a pattern of behaviour characterised by impaired control over gaming, increasing priority given to gaming over other activities to the extent that gaming takes precedence over other interests and daily activities, and continuation or escalation of gaming despite the occurrence of negative consequences‘. However, even this classification has proved controversial, with Jo Twist, CEO of the UK’s gaming trade body, UKIE, calling it „premature“ and many claiming that more research is required.

The committee spoke favourably about steps taken to address gaming addiction in other countries, such as the measures Tencent have put in place in Asia to restrict play time and late night gaming by under 18s. The suggestion was that gaming companies should be taking active steps to monitor and address excessive gaming and spending on in-game purchases, particularly for children. However, industry representatives such as King have pushed back on this, claiming that gamers found steps taken in the past to actively intervene in playing and purchasing habits „too intrusive“.

It remains to be seen what the ultimate recommendations of the inquiry will be and whether the UK will take steps to legislate on loot boxes, age-verification, and the duty of care owed by publishers to the gaming community. However, it seems likely that the government will expect the industry to take more pro-active steps to self-regulate if additional legal requirements are to be avoided.

In any event, what is clear is that further independent research is needed to identify the most effective ways to approach these complicated and emotive issues.