A new descriptor for loot boxes in video games from ESRB

The videogaming industry is working to increase even more the level of transparency on loot boxes

A new descriptor was issued by ESRB aimed at acknowledging customers even more of the presence of loot boxes in videogames.

What are loot boxes in video games?

There is no legal definition of loot boxes, but they are commonly considered as

in-game items that can be purchased by users with the purpose of randomly obtaining particular gaming contents or other utilities“.

The main feature of loot boxes is that players do not precisely know the item that they are buying. The purchased item is determined by a random number generator, according to criteria that publishers often make available before the purchase.

Loot boxes may be categorized based on the method of acquisition as follows:

  • Game-play where items are randomly awarded to players as a result of game-play for achievements, milestones, and challenges completed;
  • Game-play with purchasable items where items are randomly assigned to players during game-play, but players must purchase/obtain an item to open the loot box;
  • Purchasable for which players have to buy a loot box and open it to obtain a randomly assigned item.

The uncertainty as to the item that is purchased by customers led to major debates on their qualification as gambling and on the level of transparency that needs to be assured so that players are aware of what they are buying.

The new ESRB descriptor for videogames with loot boxes

The video gaming industry has already worked with rating agencies to protect their customers so that the information on features of loot boxes is fully transparent. Earlier this year, major console manufacturers and publishers had worked on the adoption of a new PEGI rating for loot boxes.

And now the ESRB (Entertainment Software Rating Board) announced that it also introduced an information label, a descriptor, to indicate the presence in videogames of loot boxes, or in-game purchases with random content. The objective of the new descriptor will be to make the content present in the video game clearer and to ensure uniformity within an industry that is growing steadily and in which developers continue to explore new forms of monetization for their products.

The pictogram that represented the existence of microtransactions within the videogame was already present but did not distinguish between the so-called in-game purchases and in-game purchases with random content i.e., those microtransactions for which users pay to buy a product but the content of that product is randomly assigned. The English wording established by ERSB is: “Includes Random Items” and will apply not only to loot boxes but in general to all types of purchases whose contents are assigned randomly, including gacha games, prize wheel, caskets, etc..

Based on the press release published by ESRB, the word loot box will not be used in the video game pictogram to ensure immediate understanding of the product’s characteristics to all those who are not familiar with video games.

Is self-regulation the most effective way of regulating videogames?

Giulio CoraggioThe video gaming sector is very dynamic and is rapidly evolving with the addition of new features and the growth of new areas of business, such as esports. Under the current circumstances, any regulatory restriction would just hinder the growth of the sector that can already rely on general consumer protection regulations, which are sufficiently broad to adjust to different circumstances.

In this scenario, console manufacturers and publishers are doing extensive work to create high levels of transparency across different jurisdictions, and I believe this is the way to be pursued. The level of complaints in the sector is currently low, which means that the industry is doing a great job. There are exceptions, and improvements are always possible. Still, they also need to consider that it is a global business that to remain profitable and enable players to enjoy all the features of games that cannot require excessive localizations.

On the topic above, you may find interesting the article “How loot boxes deal with regulations and limitations?“.

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Giulio Coraggio

I am the location head of the Italian Intellectual Property & Technology department and the global co-head of the IoT and Gaming and Gambling groups at the world-leading law firm DLA Piper. IoT and artificial intelligence influencer and FinTech and blockchain expert, finding solutions to what's next for our client's success.

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