Anti-lootbox Senator claims gaming lobbyists are getting worried; Nintendo pulls mobile titles from Belgium over lootboxes

    
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It’s a day that ends in “y” and so that means some fresh lootbox-related news to share with you fine folks!

First up is an interview with Missouri Senator Josh Hawley, who took a moment to talk about his efforts to pass legislation against lootbox and pay-to-win microtransactions. In the interview, Hawley addressed concens that the legislation proposal was nothing more than a publicity stunt and that it wouldn’t get much traction in US Congress. He also says that video game industry lobbyists have halted him and expressed their dismay at his proposal — an indication, says Hawley, that he’s on the right track:

“They’ve certainly expressed their, shall we say, concern over this legislation. But I think that’s probably a good indication that we’re getting somewhere.”

Meanwhile, in Belgium, The Big N has elected to halt service for Animal Crossing: Pocket Camp and Fire Emblem Heroes on Tuesday, August 27th. The decision comes as a result of “the unclear situation… regarding certain in-game revenue models,” which is a reference to Belgium’s own crusade against gambleboxes; you’ll recall the country has named and shamed a number of high profile companiesover the business model, which you can get caught up on in the roundup below.

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Geoff Bogaert

As someone from Belgium, allow me to add some nuance to hopefully explain the situation a bit better.

1) Belgium is not on a crusade.
2)lootboxes are not banned.
3) gambling is legal but regulated and taxed accordingly.

What has happened is that our “commission of games of chance” was made aware of lootboxes. And they concluded that they fall under our legal definition of gambling. No laws were written or changed for lootboxes.

Gambling is a 100% legal IF you comply with a few regulations. The main ones being that you can’t market to minors and that you must agree to routine and surprise inspections of the system in combination of informing your customer of the chances, in other words, the drop rates.

This is to ensure fairness in the system and to ensure it is a fixed chance like slot machines etc. for each individual. So no individually tailored smart algorithms.

Unsurprisingly that was not agreeable.

Mewmew
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Mewmew

That kills most mobile games though, and especially stuff from Nintendo. These games are filled with minors.

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Geoff Bogaert

Yes perhaps so.

All in all, the law was written years ago to ensure fairness in gambling.

I personally agree with the spirit of this law. The solutions are easy enough.

Either remove the offending mechanic from a product that can be accessed by minors. Or comply with the established regulations to ensure fairness in the system.

For these companies it comes down to economics. So it’s cheaper to just remove the product.

The gambling law is one of the few laws that was written in a future proof way for a digital age.

I believe the last addition was in 2008. But the essence goes back 30 years or so.

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Arktouros

The part that companies didn’t find agreeable was the way they interpreted the law. If you read most Gambling laws they essentially come down to wagering something of value for a chance at something else of value.

Video games have gotten around this in most countries because the “chance at something else of value” doesn’t stick as most game companies argue none of the virtual goods has any real world value. I couldn’t cash out my Overwatch skins down at the pawn store for $5 or anything. There are websites like Player Auctions but those are generally against the game rules and if reported/caught usually that leads to the account getting banned and the goods being functionally deleted.

The Belgium decision differs from other countries because they decided if something in the boxes is desirable then it has value. Since it has value, it can be regulated under gambling. Similarly, but different, Netherlands ruled that things only have real world value if you can resell them (meaning Overwatch boxes are fine, but CS:GO boxes aren’t cause of the skinconomy).

Almost every game out there with virtual goods in our virtual worlds and games operates entirely on the principle that everything has no real world value. They can delete that person’s account who got selling their account because none of it has real world value and they own everything on paper even if you paid for it. Any legal decision that says these virtual worlds and goods in them has real world value is a huge threat to any company doing business because it has the potential to literally turn the whole industry upside down.

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Geoff Bogaert

I’m not disagreeing with your reply.

But I keep seeing “interpretation of the law” being repeated over and over.

The law is not being interpreted here.
The law on gambling has defined gambling as X Y Z under our law.
Lootboxes fall under those XYZ.

No interpretation is required.
Like I said, this is a rare case where a law is suited for a digital age.

The whole value thing is a very complicated topic because we purchase digital goods yet the company can revoke our access to a purchased good. That’s a whole other can of worms where the law has not caught up yet.

It’s an interesting debate for sure.

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Arktouros

It is the law being interpreted here, specifically the part where gambling requires wagering something of value for

    something else of value.

In most countries who all have very similar gambling laws, including Belgium previously, this law was not applicable to video games because the “something else” had no value. They then decided, after the study/findings/report (whatever you wanna call it) that they do have value.

That’s the difference in interpretation. Most other countries, who again all have very similar laws, don’t see the contents of the lock boxes as having value and therefore aren’t gambling. Netherlands has it’s own interpretation.

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Schmidt.Capela

That’s more like a digital loophole those publishers use across the world; just about anything physical has value, why not desirable digital-only items?

Gambling needs to be regulated for two independent reasons.

One is the possibility of using it to launder money; with chance-based outcomes and large payouts, it’s fairly easy to launder illegal money through it, even without the operator’s cooperation, unless proper controls are in place. Lootboxes, for the most part, don’t trigger this issue.

The other one, though, is the potentially addictive nature of gambling; every time you see news about people losing more than they could afford to, wasting money they needed for their living expanses on games of chance, this is the aspect of gambling that is responsible, and due to that needs to be strictly regulated. This is the issue that lootboxes share; for far too many people, and in particular children who still don’t have proper impulse control, they can be dangerously addictive.

This is why, IMHO, the laws defining gambling should be changed so lootboxes are unambiguously defined as gambling, the same way lotteries and sweepstakes often are. Lootboxes are as harmful to society as gambling, and with gambling regulations not covering them publishers currently feel free to pull every dirty trick perfected in the story of gambling, tricks that nowadays would often send anyone using them in legally recognized gambling directly to jail.

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Nathan Aldana

Leave it to this asshat from my state to go to every asshats favorite tactic, ye olde “Beat your chest and proclaim your adversaries are scared of you”

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starbuck1771

Well I wouldn’t call him an asshat. I as someone who has spent several thousand on microtransactions can see both sides of the issue. In the end loot boxes are the biggest scam around because in the end they got your money and you have nothing.

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Bruno Brito

I don’t know the guy so i can’t give feedback on him, but given how Michael Avenatti was just indicted three times, i’ll say what Popehat said:

“Just because someone fights for a good cause, doesn’t mean they’re not a trainwreck.”

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Jack Pipsam

Woke: Disable loot boxes in Belgium.
Broke: Take the entire game offline.

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Arktouros

Yea isn’t a publicity stunt. Sure. Still waiting to see the details of that legislation he’s proposing. There’s lots of sensationalized headlines about how he’s going to ban the p2w and how he’s going after those loot boxes but zero actual details. The kids, the kids, why won’t anyone think of the kids? Chris Lee had lots of bluster and big headlines too, and his proposals were actually absurd and all died due to lack of interest by other legislators.

The Belgium thing continues to be unsurprising. As mentioned numerous times in the past, you can’t legislate morality. You can’t legislate and force companies to change the way they operate. They’re just going to comply with your laws and operate around you. When, or if, enough people make doing business hard they’re just going to come up with a different predatory business model instead.

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camren_rooke

Damn dirty socialists like me would want the government to be hefty enough to enforce rules on companies. Mostly because its not so much legislating morality, but gambling is a mental health issue. One that has real world effects on a population.

And I kinda think that SHOULD be something a government would want to do to protect its citizenry.

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Arktouros

As someone who doesn’t really identify as anything, albeit my views largely fall in line with libertarian, I have absolutely zero faith in the government to do anything competently and will most likely end up doing more harm in the games industry than good.

It is absolutely legislating morality because people grossly misidentifies the issue going on. While I’m sure there are a few players who are gambling addicts I think the vast majority of those of us who engage in these practices aren’t doing so because we are addicts or find the experience enjoyable on any level. This is because we understand what most companies are doing is price sinking by making you buy a hundred $3 boxes to sell you a costume for $300 rather than just selling you a $300 costume that most people simply won’t pay for. That is an unethical, predatory business practice that legislation would seek to address, hence legislating morality.

However companies won’t be legislated. Oh sure, you can pass legislation, but they’re just going to walk around your laws just like they continue to operate around Belgium. They can do that because Belgium is inconsequential, but if you get enough big countries on board they aren’t going to have some self reflective moment and “stop being evil” they’re just going to find an alternative way to be evil that is harder to legislate. Unless you’re willing to go to some China level dystopian nightmare where the Ministry of Culture (actual thing) is going to review each one it’s never going to actually happen.

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camren_rooke

I would have to say I respectfully disagree with most of the above but thanks for letting me know your thoughts on it.

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John Kiser

They aren’t entirely wrong though. Actual gambling addiction isn’t so high that things should be flat out legislated. The people I know that buy lootboxes etc heavily do so because they want a specific item from them and not because they have a compulsive need to open those boxes and that is a different thing than a gambling addiction (which is a compulsive need to do it).

The best way to handle this kind of thing honestly would be legislating to identify potentially bad behavior and blocking purchases from people that look to be addicted using an algorithm to do it.

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Bruno Brito

The people I know that buy lootboxes etc heavily do so because they want a specific item from them and not because they have a compulsive need to open those boxes and that is a different thing than a gambling addiction (which is a compulsive need to do it).

Opening several thousand lockboxes towards a single item is still gambling behavior. Not everyone goes to Vegas just to feel the place and hear the slots. A lot of them go to actually make money ( and end up losing it ).

My mom smokes “not because of an addiction”, but because it relieves her of stress. “She can stop anytime”, like she keeps saying to me.

Well, i because 29 yesterday. She been smoking for 35 years now.

The reasons are irrelevant, the behavior is what matters. Lots of addicted try to rationale their behavior to fit within the views of normality.

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Utakata

For me, it’s about not legislating morality while legislating the nature of doing business. I think that dealing with these as two separate issues will hopefully long put to rest legislating to score political points, while untying the hands of government to do the right thing. Thusly, Mr. Hawley is failing the smell test in the former, while Belgium might be on the right track, IMO.

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Nathan Aldana

see, my problem with libertarian modes of thought is they distrust the government, but also seem cheerfully happy to allow corporate overlords to take everything from them they fear the government would.

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Arktouros

I can see you’re trying to be clever but it doesn’t quite hit home.

My distrust for the government in this scenario has to deal with thinking the whole problem through. If you create a rule, you have to enforce that rule. If you enforce that rule, it’s going to require people to do the enforcing. Given the scope of things (potentially every game across all platforms could need to be reviewed) that’s going to likely mean requiring additional people rather than existing people. Additional people means more funding to pay them. More funding requires a source of that funding, either through additional taxes or by allocating budget away from something else. It’s through all these nitty, gritty details that you see the endless potential for disaster be it personal incompetence or a change in the political winds.

In the case of the corporate overlords, the fact is we’re not talking about essential services here. These are entertainment products voluntarily played or dropped at our whims. When I didn’t like ArcheAge’s cash shop model forcing me into loot crates to get gear upgrades I quit despite considerable personal time and “financial investment” into the game. Pretending like some corporation is forcing you or anyone to buy lockboxes is just absurd.

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Geoff Bogaert

Murder is illegal last time I checked.
That is morality being legislated and most of law is a written and agreed upon set of rules based on a morality judgment. I’m trying to avoid going into a deeper topic of right and wrong.

Each country has its own set of morals though.

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Arktouros

That really wasn’t my point. The point is that legislation or law doesn’t make people inherently change their behavior. Murderers still murder, and profit hungry corporations who resort to predatory schemes to prey upon consumers are going to continue in new, different ways.

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Geoff Bogaert

I understand your point.

My reply was to show that legislation puts a legal framework in place to punish behavior based on a set of morals. Like murder.

If you don’t put some regulations in place, corporations or any other entity will just barge through without any care for the damage they cause all in the name of profit. Not even sustainability, just profit. Expecting a corporation to change is silly because it is not a person.
It is only when the last fish is gone that a tuna company will realise the errors of its strategy.

But that feeds back into a whole other level of discussion.

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Arktouros

Stating the laws are based on morality, which isn’t at all the case even for something like murder, is wholly irrelevant. My point stands that laws and legislation can’t create or force people to actual morally or ethically.

Again the Belgium scenario is exactly what I’m talking about. Belgium interpreted loot crates to be in line with their laws on gambling. Did companies take a good hard look at themselves in the mirror and change their evil, wicked and predatory ways? Fuck no. They cost-benefited analyzed the shit out of that bitch and decided it’s cheaper to write off Belgium as a source of income than it would be to change.

To take your analogy further, if they ban farming Tuna with nets because it’s unethical they’re just going to switch strategies. Then it’ll be some mega boat that scoops up a giant chunk of seawater then lifts it up filtering out the Tuna.

You could argue that’s just a net with extra steps, but that’s all your legislation is going to do. Add extra steps. In the end they going to get that Tuna.

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Schmidt.Capela

More like mores, the accepted customs and conventions of a society, and widely regarded in academia as the wellspring of all legal systems; they’re closely related to morals, though not exactly the same.

And no, laws can’t force people or companies to grow a conscience. But they can be used to punish, and in some cases punish heavily, people or companies that act in an overtly immoral way, as long as lawmakers and the courts are willing to push the issue.

You can see this, for example, in how European law allows companies to be fined for a hefty share of their global revenues for intentionally breaking local laws; the idea is that acting against European mores, while operating in European soil, should be expensive enough no company in the world would be willing to do it. It doesn’t always work, but it certainly made big multinational companies more willing to listen to European concerns.

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camren_rooke

I am continuing to try and wrap my head around what Hawley gets out of this.
As far as I can tell he is your bog standard conservative republican who is for smaller government and less government intervention in industry.

The BILL sounds like a good thing but given who it’s coming from I’m leery. There is a screw coming I just don’t see it.

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Arktouros

It depends how you see the corporations. From the few things I’ve read (this interview, etc while looking for actual details rather than sound bites) he seems to view the technology sector more along the lines of sinful businesses (IE: smoking, booze, druggery, etc) rather than actual, legitimate industry. The social media companies are out for your data and manipulating your children while gaming companies are just looking to hook your kids on gambling so they can steal all your money. That kinda thing.

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camren_rooke

I get that, but the legislation he is presenting seems to only target games for children. Maybe I misunderstood. Legalese and I do not go together.

I think I have this uneasy feeling its going to be a case of ‘No lootboxes for Dora the Explorer games but Lootboxes are A OKAY for anyone over 12 so take THAT Belgium.”

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Arktouros

We don’t know any of the actual details yet and from what I’ve researched there are none to be had other than sound bites and sensationalized headlines.

I was speaking more to his motives.

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camren_rooke

Agreed. I am leery of his motivations as well.

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Nathan Aldana

Oh nah. if anything itll have loopholes a mile wide that can be used to somehow define farmville-ish dfacebook games as lootboxes to attack facebook.

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Aelzen

I wouldn’t be surprised if it’s going to have a rider attached that had nothing to do with the issue. Propose something that everyone likes the sound of but sneak in a ban on gay marriage or mosques or something similar (that’s probably a bit extreme, but you get the idea). Very few senators read anything like this, just the cliff notes that come with it so they get the broad strokes that the proposer is trying to get across.

It’s sad that I automatically go to this kind of cynicism, but history has taught me that’s precisely where I should go so as to not be disappointed.

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PanagiotisLial1

The problem is to be any real effect it needs to have entire and/or US/Canada demand lockboxes regulations. As it is now belgium is a small market they will almost happily avoid in order to continue with current financial models

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Jack Pipsam

The hope then is that it spreads to the rest of the EU, that cannot be ignored as easily.