The Ethics of Loot Boxes and How They Changed Games

Throughout the 2010s, the phrase “loot box” became one of gaming’s red flags. After a slew of different, ever more restrictive, approaches, gamers and policymakers alike decried loot boxes as the bane of modern gaming—at once ruining in-game progression and draining players’ bank accounts.

Ethics of Loot Boxes

In other words, these innocent-looking crates of random goodies became vilified. This is why we see so few games implementing loot boxes today.

Let us take a look at what made loot boxes so unpopular, why they have largely been removed from gaming and how the mechanics of the loot box are much more far-reaching than gaming.

What is a Loot Box?

If you’re a gamer, chances are, you’ve opened plenty of loot boxes. But in case you haven’t let’s run down what constitutes a loot box.

In the context of gaming, a loot box is a virtual item that a player earns or can purchase while playing.

Upon opening a loot box, the player is showered with random rewards—each with a certain percentage chance of being dropped.

These rewards can range from cosmetics to currencies to gameplay powerups or unlocks.

The thrill of loot boxes comes from the unknown. After receiving one, most players are thrilled to see what it holds—crossing their fingers that it will be that rare skin they’ve been hoping for.

Where Did Loot Boxes Come From?

Not surprisingly, the idea for loot boxes comes from outside of the world of video games. Similar concepts have been used in various forms of entertainment for decades.

Two of the most prominent examples are Gachapon machines—those vending machines that give you a small toy in a capsule—and Baseball cards. Both of which have been around since the mid-20th century.

If you’ve ever interacted with either Gachapons or trading cards, you’ll know how addictive the loot box mechanic can be—even when not related to your favourite game.

How do Loot Boxes work?

So, the allure of the unknown is nothing new, and game developers (perhaps more specifically, publishers) know this.

Meaning that loot boxes were created to tap into players’ desire to unlock rare items while locking them behind RNG.

This RNG is crucial to how loot boxes work—after all, once you’ve got all the items or enhancements you want, you probably won’t be interested in opening any more boxes.

Thus, developers tend to keep the rarest drop rates incredibly low—we’re talking about fractions of a percentage chance.

By doing this, alongside ensuring there are enough items to have each player desiring at least a few, developers manage to keep players wanting more and more loot boxes—causing them to either grind for unlocks or, better yet, spend real money to buy the loot boxes.

The Controversy: Gambling and Addiction

When explaining loot boxes as we have so far, one thing comes immediately to mind—is this a form of gambling?

This is a question which came to the forefront of the loot box debate; and which many critics used to push for new legislation surrounding loot box mechanics in games.

The argument is that if loot boxes are truly randomised, similar to slot machines or scratch cards, then they are a form of gambling.

While many might argue that this is fine in a virtual setting, where there’s no real money involved, many would argue that engaging with loot boxes encourages gambling-like behaviours in players; behaviours which may later be taken out into the real world.

This encouragement would be especially powerful for young players who may be more gambling-resistant.

Not only this, but many argued that, much like gambling itself, loot boxes are addictive—in turn hooking susceptible players to the game through addiction rather than enjoyment.

Many have argued that these effects of gambling and addiction are more likely to affect young players and children.

They might not yet fully understand the implications of spending real money on randomized rewards. In turn, making them both more likely to overspend in the present and to become addicted to similar behaviours in the future.

As a result, many countries expressed began to pass laws to regulate or outright ban loot boxes.

Countries like Belgium and the Netherlands have deemed certain types of loot boxes illegal, while many other countries now require gaming companies to fully disclose the percentage chances of obtaining each type of item when opening a loot box.

Ethics of Loot Boxes

The End of Loot Boxes: The Rise of Battle Passes

Because of this regulation, alongside the widespread public outcry that accompanied it, loot boxes have largely been scrapped in games today.

Of course, RNG in games will always exist but loot boxes—those crates that players spend hundreds of dollars on—are no more.

While this may sound like a legislative win, the new model that has followed them only solves part of the problem.

This new model is Battle Passes—monthly or seasonal subscriptions which players pay to be able to unlock more in-game goods.

Games like Overwatch have migrated from loot boxes to battle passes—speaking of which, you can easily buy Overwatch 2 accounts nowadays.

While the topic of battle passes is large enough to have its own article, in short, many are expressing concern over the recurring payment models and peer pressure that battle passes levy on players; especially young ones.

Of course, developers need to pay their bills—so they need to be able to find adequate monetisation strategies for their games.

However, most gaming has come to the consensus that their chosen monetisation strategies must adhere to a certain standard of ethics, avoiding exploitative mechanics that resemble addiction or gambling.

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