The Federal Trade Commission – FTC – is preparing to gather facts on one of the biggest money-making trends in the gaming industry this generation: loot boxes.

On Monday the FTC announced that they will be hosting an event dubbed Inside the Game: Unlocking Loot Boxes, an event described as a public workshop on the “behavioral impact of these virtual rewards on young consumers.”

According to the FTC’s website, the Unlocking Loot Boxes workshop will cover a number of areas, including:

• A look at the in-game transaction landscape, including the origins and evolution of loot boxes and their role in game play and the digital marketplace;
• Research examining consumer behavior, including child and adolescent behavior, in the context of video games and digital transactions; and
• A discussion of consumer awareness and education about in-game digital transactions, including the mechanics, marketing, and financial commitments associated with loot boxes.

The FTC turning their gaze on the loot boxes trend lays an ominous foundation for pending government regulation on the gaming industry, as other areas of the technological sector are beginning to come under similar scrutiny.

Social media companies are already feeling the heat of a governmental gaze, both in the U.S. and abroad.

On Monday, Cnet reported on efforts in the United Kingdom to hold social media companies like Facebook and Twitter more accountable for the content that users post to their platforms. The Home Office and Department of Culture, Media and Sport announced plans in a governmental white paper to appoint an official regulator to oversee efforts by social media and hosting sites to keep potentially harmful content in check. However, any regulation oversight on social media platforms, and tech platforms as a whole, will lead to a firestorm surrounding free speech issues.

Game fans who have been around a while may remember Sen. Joe Lieberman’s Gaming hearings of the early ’90’s

The gaming industry has largely been untouched by the prospect of government regulation, except for a brief flirtation with controversy in the early ’90’s during a series of hearings by then-Connecticut Senator Joe Lieberman. The fallout from the extra attention led to a greater effort by the gaming industry to self-regulate, as well as the creation of the ESRB – the entity that has been responsible for providing a content rating for every game released since 1994.

While the video game industry in the U.S. has been free thus far from official regulation, it’s a trend that is gaining ground around the world. In mid-March, government official in India actually arrested a number of gamers for violating that country’s ban on the shooter, PUBG.

At home, the concerns are centered around the argument that the way in which loot boxes reward players for spending increasingly significant amounts of money on a chance that a player receives a desirable item can be considered as a form of gambling. Gaming companies have not exactly helped their case either. For instance, EA in has created a number of controversies in the past few years over the grossly arrogant and incompetent way loot boxes have been implemented in certain titles.

Beyond the loot boxes issue is the ever-present concern regarding the increasingly graphic depictions of violence portrayed in modern video games. Following the tragic 2018 shooting at a Parkland Florida high school, President Donald Trump cited the violence in video games and movies as an illicit influence in the shaping of young minds. The White House would soon produce a video montage showcasing a number of particularly graphic moments in a number of games. President Trump, in conjunction with the ESA, would also host a White House summit on violent content in gaming, which was attended by a number of high-profile industry figures.

The precedent has been set, and like a bear to honey, the government now has the potential to use the loot boxes issue as a way of regulating the gaming industry as a whole.

What that potential regulation would look like, and how comprehensive it would be is anybody’s guess; however, sources speaking to NerdBacon have stated that the prospect of coming regulation is something that every major game company is taking seriously, should Thor-like hammer blows rain down from the feds.

The FTC will host their hearing on loot boxes on August 7th, 2019 in Washington D.C. The hearing will be open and free for the public to attend.

headline image from sciencedaily.com

Written by The Watchman

The Watchman is a journeyman gamer who has seen and played a good chunk of gaming history.
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