The US Federal Trade Commission has concluded its workshop on loot boxes.
The regulatory agency invited people from all across the games industry and hosted several panels to discuss the issue of gambling, loot boxes, and their implementation in video games.
During one of the panels, Online Performers Group CEO Omeed Dariani stated that his PR firm has been approached by numerous video game publishers to assist in willfully misrepresenting how loot boxes work. His firm most notably represents popular YouTube content creators such as AngryJoe, KingGothalion, and rapper T-Pain. Darian also expressed his concerns with online video platforms regarding disclosures of paid advertisements during livestreams.
Dariani made the comments in response to FTC attorney Brittany Frassetto’s questions about the nature of the disclosures that his clients are expected to make during their live streams.
“Based on your expertise,” Frassetto asked, “do video games [publishers] pay these content creators to open loot boxes? Do they pay for the loot boxes? And, if so, do they at times give them better odds than the public at large? And how much of that is disclosed?
“Companies do pay for that sort of thing,” Dariani said. “It’s pretty uncommon for it to specifically be, ‘Hey, just open a bunch of loot boxes.’ But, we’ve definitely seen that.”
“I’ve definitely been in a room where a publisher said, ‘We could do better odds on the packs that this person opens for promotional purposes.’” Dariani continued. “That’s only been one time.”
Presently, it is not illegal for publishers to not disclose that they have altered the odds of players acquiring an item in a loot box. However, Dariani’s recent testimony may influence the FTC to pass regulations that could lean in that direction. He also explained that publishers with business in the eSports market like Activision Blizzard and Electronic Arts were more likely to approach him to have his clients do loot box opening videos. Most of them do not object to these requests because loot box opening videos tend to gather a lot of views for their channel.
“Content creators very often open the loot boxes because audiences really enjoy that,” Dariani said. “It’s exciting, right? You don’t know what’s gonna come out. You don’t know if they’re going to get the rare stuff and hey, I don’t have thousands of dollars to spend on buying my own loot boxes, so I can watch someone else do it and sort of live vicariously through them.”
Later during the Q&A, Dariani criticized popular live-stream platforms like Twitch for not enforcing more rigid and stricter advertisement disclosure guidelines. A Twitch stream can last for hours and that it places too much of a burden on hosts to continually remind viewers that their stream is sponsored by a major company. He was concerned that with Twitch being such a marketing-friendly platform that there aren’t security measures that warn viewers that they are about to view sponsored content. One example of these measures would be requiring viewers to disclose their age, which would potentially protect underage streamers from being preyed upon by major corporations. This has been a major criticism of the games industry and its present implementation of loot boxes and microtransactions being seemingly aimed at underage youth.
“What’s really interesting about it to me,” Dariani said, “they’re not ashamed to admit that they’re being paid for these things. In fact, it’s actually a benefit to them in a lot of cases [to be able to say to their audience], ‘Look, EA is recognizing that my content has value. They’re paying me. They’re supporting my channel because of the work that we’ve done, that the community that we’ve grown together with our audience.’ These big companies are involved now and that, for many people, can be a source of validation, a sign of growth, a badge of honor.”
This news comes following the announcement that Sony, Nintendo, and Microsoft will all require publishers to disclose the odds of loot box drops in all new games and updates. It is not known how this recent exchange with Dariani will affect the new disclosure requirement at this time. FandomWire has reached out to all three for comment.
Dariani’s insights into social media influencers and their relationship with gaming publishers provides more information for an interesting and still ongoing conversation. Whether the FTC could act upon this information and pass regulations is uncertain, but it certainly does not ease tensions between AAA publishers and consumers who have grown frustrated with their questionable business practices. The recent FTC workshop is one of many examples where a government has expressed concern about loot boxes and microtransactions. A UK parliamentary committee was conducted a few months ago with several representatives from EA and other companies being asked questions about whether these practices were illegal. Republican US Senator Josh Hawley has proposed a bill that would ban loot boxes which has gained bipartisan support from Senate Democrats such as Richard Blumenthal and Ed Markey. Hawley has been a vocal critic of the tech industry and the recent proposed legislation is one of the latest instances in which he has attempted to challenge it.
What do you think of this news? Do you think loot boxes should be banned? Let us know in the comments below!