A loot box is a purchasable in-game digital container holding randomized virtual rewards. In recent years, loot boxes have become increasingly common in video games. A large number of major video game titles now incorporate loot boxes, and loot box sales now eclipse traditional game sales as the primary source of revenue for much of the video game industry. Given that more than half of teenagers play video games for several hours each day, the growth of loot boxes has sparked a contentious debate over whether loot boxes constitute a form of unregulated gambling targeted at children. This Note contributes to this debate by evaluating loot boxes from the gambling perspective. Although many loot boxes may fail to satisfy the traditional common-law definition of gambling, the parallels between loot boxes and gambling-especially in light of the prevalence of loot boxes in children's video games-create an urgent need for regulatory action. Moreover, this Note argues that the Entertainment Safety Ratings Board (ESRB) should regulate loot boxes by enacting new rules requiring mandatory disclosure and labeling for video games containing loot boxes. Alternatively, if the ESRB fails to remedy the existing regulatory gap, the Federal Trade Commission should enact loot box regulation. Mandatory disclosure and labeling would enable players and parents to make informed choices regarding loot boxes.
Alexandra M. Prati,
Video Games in the Twenty-First Century: Parallels between Loot Boxes and Gambling Create an Urgent Need for Regulatory Action,
22 Vanderbilt Journal of Entertainment and Technology Law
Available at: https://scholarship.law.vanderbilt.edu/jetlaw/vol22/iss1/6