Over the past four years, loot boxes have skyrocketed in popularity. These virtual crates of in-game items have become a mainstay of the video game industry, with major franchises such as FIFA, Star Wars, Overwatch, and Fortnite using them, sometimes as their dominant revenue driver. Tech analysts Juniper Research estimates the current market to be worth over $30 billion, with projections of $50 billion by 2022. However, with their meteoric rise comes concerns over their impact on gamers, as a growing body of evidence suggests that loot boxes are addictive. Psychologists warn that the techniques loot boxes employ are designed to create addictive tendencies, with studies showing similarities between them and problem gambling. Despite this recent attention, the US has yet to establish a policy response, with no viable regulations foreseeable within the next year.
This document seeks to assist regulators in determining an effective policy response to loot boxes. Whereas many proposals focus on combating potential addiction, this recommendation additionally examines the structure of loot boxes and how they are embedded with “dark patterns”, or designs intended to trick players into spending more money. It will also consider the economic ramifications of certain policy responses. This includes synthesizing the opinions of games industry veterans and original analysis of recent FTC workshops on dark patterns. Effective loot box policy will ensure a safe and transparent experience for consumers without adversely harming the gaming industry.
