The new legislation that was passed in Belgium might mean lower profits for new online casinos. This will especially influence those that deal with loot box gambling. This Belgium gambling law states that loot boxes are to be outlawed.
What is a loot box?
A loot box is an in-game item that contains a random selection of other in-game items. Some games give a loot box for free, others don’t, and only support paid loot boxes.
For many players, it is a way of getting expensive in-game items for a fraction of a price. You have a small chance of receiving one of the most costly items like skins or weapons from a loot box. However, it is rare, and they mostly give players medium-priced items.
Loot boxes are very popular in online games like CS:GO. Overwatch players are particularly fond of them. The game makes the process of opening a box a show in and of itself. The box opens with amazing animation, and after the big reveal, you are offered to buy another box.
Why regulate it?
Ok, loot boxes are in-game items that allow you to get a valuable item for a low price. But why would they be considered a form of gambling?
The thing is, in the core of the idea of a loot box, there are sheer luck and random chance. You have to pay for them too, so it’s basically like wagering on a sports team. You put in a bit of money for a chance to win something more valuable than the sum you spend. Moreover, players are encouraged to buy more loot boxes, as is the case with Overwatch.
But the thing that worries the legislators the most is that loot boxes are very popular with minors. Children who play online games don’t have the money to buy in-game items, so many opt in for loot boxes. This results in children taking their parent’s money to spend on them. Since this promises them the thrill of waiting for the reveal and expensive items, it can lead them to start spending uncontrollably.
What does this mean for the gambling industry
The Belgium legislators got together to ban the loot box phenomenon out of fears that this seemingly harmless thing is a predatory practice that takes advantage of children. While it is hard to believe that EA executives specifically target children with this, the end result is hard to refuse.
Despite the fact that UK and US gambling commissions ruled that loot boxes do not match the requirements to be regarded as gambling, there are legislators in these countries who want to follow Belgium commission’s decision. If UK and US were to ban loot boxes as well, this might mean major losses for EA. Overwatch, FIFA, and CS:GO receive large revenues from them. If they lose this source, this may result in the companies looking for additional revenue sources and making some game features premium.