What Are “Loot Boxes” in Games, and Why Are They Controversial?

Recently, there’s been a big spike in people talking about “loot boxes” in video games. Several countries are calling for their removal, and Belgium is currently on the road to banning them altogether.

With people throwing around words such as “gambling” and “addiction,” it can be worrying if you have younger members of the family that enjoy video games.

So what are loot boxes in games, how did they start, and why are they causing a ruckus?

Before we talk about why they’re causing so much trouble, we must first understand what they are. Loot boxes follow their namesake: boxes or crates that are full of items. These items have a range of rarities, from basic common items to rare, highly sought-after items. The key is you can’t tell what’s inside the box until it’s opened. Part of the appeal of loot boxes is the mystery behind opening them. Will they contain bog-standard items, or will something extremely rare be inside?

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Of course, loot boxes aren’t without their costs. Some games will offer loot boxes in their store, and you can buy them with money. Some games will give you loot boxes for free as you play, but you need to purchase a key to open them. There are some that will give free unlocked boxes as a “taster,” with the ability to buy more in the shop. Some games will be free to play, with their operating costs covered via loot box purchases. Other games will cost full price but still make additional income through loot boxes.

The types of items available also changes between games. Overwatch, for instance, offers items that change the visual look of your character, known as “cosmetic items,” which don’t affect gameplay at all. Team Fortress 2 has cosmetic items but also offers alternative weapons for each character. Some games are quite nefarious and offer strictly improved items in their boxes, forcing players to open them if they want better items.

Loot boxes originated in China, in a game called ZT Online that was released in 2007. People weren’t willing to pay full price for a video game, so the company behind ZT Online, Zhengtu Network, made the game free and added loot boxes as a way to pay for in-game items. Within the first year, Zhengtu Network reported a monthly revenue of $15 million, which caused a lot of developers to take note.

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Three years after the ZT Online success story, loot boxes made their way into the west. The early adopters of this model were EA with their FIFA series, and Valve with their hit game Team Fortress 2. In the case of Team Fortress 2, Valve made the game free to play for everyone, choosing to maximise profits with loot boxes instead. Since then, loot boxes have made their way into games such as Overwatch, Middle-earth: Shadow of War. and even the Twitch streaming website.

This is the million dollar question, and it’s what’s causing so much debate. As loot boxes make their way more and more into video games, people are growing concerned over their prevalence. The main topic at the moment is whether or not purchasing a box full of random items is considered “gambling,” taking into account multiple aspects of the loot box. If they are considered gambling, then they’ll come under the full laws and regulations associated with them. So, what are the arguments?

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Guaranteed Items

For one, does the fact that you’re guaranteed items with a loot box stop it from being gambling? Some methods of gambling (such as slot machines) have an outcome where you’re left with nothing. Loot boxes, however, always guarantee items with every opening. These items may be duplicates of ones that you already own, but it still technically counts as a gain. Some games also have ways to exchange or craft the duplicates for more in-game items.

No Real-World Value

Secondly, most games don’t allow loot box openings to transfer into a real world gain. For instance, if you get a very rare skin from a loot box in Overwatch, you cannot officially sell the skin for real money. This element of loot boxes caused the UK Gambling Commission to announce that loot boxes aren’t gambling.

Randomised Products

However, at the end of the day, it’s still paying real money for a random percentage chance of a specific item. In some people’s eyes this element alone is enough to class loot boxes as gambling. Add to that the fact that they can be highly addictive and aggressively pushed by the developers, and you can see why people are calling for regulations.

These topics are being debated, with different regulators coming to different conclusions. As such, the future of loot boxes looks somewhat shaky as the debates move forward.

When you’re worried about your children becoming addicted to loot boxes, remember that buying them requires an online purchase. If they’re quite young, they’ll have no means of buying loot boxes without your aid, allowing you to investigate when they ask for a purchase and take control of their spending.

If they’re old enough for a credit/debit card or PayPal account, it’s tricky to know if they’re buying loot boxes without demanding their bank account information. Keep tabs on the games they play and check if they have loot boxes. If they do, be sure to warn them of the effects and symptoms of addiction.

With loot boxes becoming an integral part of video gaming, people are debating whether or not they’re gambling. Now you know what they are, how they work, and some arguments for and against them being classed as gambling.

What do you think? Are loot boxes in games considered gambling, or should they be treated like regular products? Let us know below!

3 comments

  1. Ok. So here’s the problem I have with these loot boxes. I happen to have been blessed to grow up in the 70’s 80’s and 90’s, and I’ve watched video games go from being the coin-operated ones at the local arcade (Pac-Man….Tempest…Donkey Kong etc.) to the home system, (anyone remember the Atari?…and the Commodore64 game systems?….yes. THAT’S how OLD I am!…LoL!) I’ve seen the Nintendo systems. the Sega Genesis, the very first PlayStation, and the very first XBox make their way into our homes. And it’s only been recent that online gaming has become so prevalent. Its one thing to have a “team battle” or a “capture the flag” tournament in Unreal Tournament or any game designed and developed like that, but this incessant push to have ALL of our games online? There are games I’d LOVE to play, but because they’re “Online Only” I have to pass. Gaming is a personal thing and I shouldn’t be “forced” to have an Internet connection in order to enjoy a quality title. So there’s that….then you throw in the fact that games these days?…cost almost $60 / $70 dollars sometimes, and now you want to scrape me for even MORE money by making me PAY for items in-game? Yeah…no. Enough. I will stick with the last gen gaming consoles and play the games that don’t require me to have an Internet connection, (I mean why on Earth would I even WANT to play games like “Hitman”…or “Tomb Raider” while connected to the Internet?) I will buy the games that don’t have some extension or feature designed in it to “force” me to connect to the Internet just to obtain a special sword, shield, or a new outfit. Nope. I’m done with spending on these games and titles and then getting a sub-par gaming experience, all due to “patches”….(like I thought that was strictly for COMPUTERS and OPERATING SYSTEMS!?) and before someone tries to “inform” me that the PS4…the XBox One…et al…ARE a form of computer and DO have an Operating System installed on them…let ME…remind YOU that gaming?…is supposed to be a fun, stress-free, non-aggravating thing. We all get upset when we’re trying to watch a YouTube video or stream something and it hangs, or slows down to an intolerable level….so why would we want to spend:
    $500 – on a gaming console
    $60/70 – on a game title
    another $50 – for an extra controller

    Only to get home….unwrap our game….insert the disc…and then have to wait for almost an HOUR (or LONGER sometimes!) for the “additional content” to load? Its like we’re going in the OPPOSITE direction! Well…..count me out…and the more these gaming companies try to swindle more money out of the pockets of the hard core gamers out there…the more those same gamers will “wake up” and start to realize they’re being swindled and they’ll refuse to pay for these so called “features” which are more like annoyances…which will cause the gaming houses and developers to either re-think their strategy or else fold and close their doors all because they got too greedy. There you have it…one gamer’s opinion on loot boxes and the gaming industry as a whole.

    • “but this incessant push to have ALL of our games online?”
      It’s an incessant push to put EVERYTHING online. Banks are closing branches and forcing customers to do all their transactions online. Businesses are eliminating customer service phones, forcing all contact to be made online. IRS and state tax departments are demanding online filing. etc. etc. etc.

      I am all for automation and modernization but pretty soon it’s going to get to the point of “have your machine talk to my machine:.

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