Tag: Loot boxes

UK Reverses Course On Gambling Thanks To EA’s Tone Deaf Argument


Who would have guessed that Electronic Arts worst enemy would be itself? Outside of everyone with a shred of common sense and human decency I can hear you saying, and I get it.

The last we heard from the UK in terms of possible loot box regulations, the Gambling Authority stated that loot boxes are not gambling because there is no real money payout system. Not too long afterward the Digital, Culture, Media, and Sport Committee had a sit down with some representatives resulting in what might be the most embarrassing statements to ever come out of the mouth of the gaming industry. EA’s Kerry Hopkins stated that FIFA’s Ultimate Team packs were “quite ethical and quite fun” while Epic went even deeper into propaganda territory by stating “I would disagree with the statement that Epic makes money from people playing the games.”

Well following a deluge of public comments on the hearing (never let anyone tell you your complaints don’t matter), the DCMS has published its report on immersive and addictive technologies and they are not happy with how Kerry Hopkins conducted herself. In thanking the number of people who came forward with information, the DCMS took time to admonish the industry for its dishonest and unacceptable conduct:

“In contrast, we were struck by how difficult it was to get full and clear answers from some of the games and social media companies we spoke to and were disappointed by the manner in which some representatives engaged with the inquiry. We felt that some representatives demonstrated a lack of honesty and transparency in acknowledging what data is collected, how it is used and the psychological underpinning of how products are designed, and this made us question what these companies have to hide. It is unacceptable that companies with millions of users, many of them children, should be so ill-equipped to discuss the potential impacts of their products.”

In its conclusion, the DCMS has recommended further action be taken by the government in accordance with the 2005 Gambling Act.

“We consider loot boxes that can be bought with real-world money and do not reveal their contents in advance to be games of chance played for money’s worth. The Government should bring forward regulations under section 6 of the Gambling Act 2005 in the next parliamentary session to specify that loot boxes are a game of chance. If it determines not to regulate loot boxes under the Act at this time, the Government should produce a paper clearly stating the reasons why it does not consider loot boxes paid for with real-world currency to be a game of chance played for money’s worth.”

You can read the rather lengthy report at the UK Parliament website here.

[NM] EA Fought the Law and the Law Won, Removing Loot Boxes


EA fought the law and the law won, at least that’s the lesson the company learned this week after going head to head with Belgian authorities regarding loot box sales for FIFA games.

Those of you keeping score will recall that last April, the Belgian government criminalized certain loot box systems in video games, and sent notices to Valve, Activision Blizzard, and Electronic Arts warning that several of their titles were found to be in violation of the law. The Gaming Commission warned that the loot boxes would need to be removed, otherwise the companies could face fines and even jail sentences.

Valve and Activision Blizzard took near-immediate steps to disable loot box accessibility to Belgian players, while a number of other developers have opted to either alter their titles or outright shut them down within the country. EA meanwhile decided to take a gamble of its own and face a criminal investigation in order to keep selling those sweet ultimate team bucks. Unfortunately for EA, this gamble didn’t pay off, and the developer has posted a warning that FIFA Points will no longer be for sale in Belgium by the end of the month.

In case you were worried, EA notes that this change will have no material impact to their quarterly revenues.

After further discussions with the Belgian authorities, we have decided to stop offering FIFA Points for sale in Belgium.  We’re working to make these changes effective in our FIFA console and PC games by January 31, 2019.  This means that players in Belgium will not be able to purchase points to obtain FIFA Ultimate Team packs.  Players still can access Ultimate Team and play with their existing players.  All content in the game can be earned through gameplay, as has always been the case, and players can continue to use coins and the in-game transfer market.  Any players in Belgium that have existing FIFA Points in their accounts can continue to use them, but they will not be able to purchase more.  We apologize to our players in Belgium for any inconvenience caused by this change.

We seek to bring choice, fairness, value and fun to our players in all our games.  In addition to providing players options in how they play, we include pack probabilities in our games for the transparency players want to make informed content choices.  While we are taking this action, we do not agree with Belgian authorities’ interpretation of the law, and we will continue to seek more clarity on the matter as we go forward. The impact of this change to FIFA Ultimate Team in Belgium is not material to our financial performance.

Source: EA Games

In Response To Gambling Laws, Square Enix Starts Pulling Titles From Belgium


Earlier this year the Belgian government gave a clear warning to game developers: Fall into line with your gambling mechanics or face potential criminal charges including fines and even jail sentences. Over the last seven months, we’ve seen the industry take the threat very seriously (for the most part). Companies like Blizzard and Valve have simply stopped allowing players within Belgium to purchase loot boxes, while Electronic Arts stood its ground and is now facing a criminal investigation.

Companies like Square Enix, meanwhile, are just pulling out of the country entirely. Square announced that at least four of its titles will no longer be accessible from Belgium as of December. Those titles include Final Fantasy: Brave Exvius, Mobius Final Fantasy, Kingdom Hearts Union X, and Dissidia FInal Fantasy Opera Omina. All four games will no longer be accessible in Belgium over the next month, although it isn’t clear if people will be able to circumvent the block with a VPN or if Square Enix will go as far as to disable existing accounts that have been operated from within Belgium.

(Source: GI.biz)

Column: Stripped Down For Belgium, A Post-Lootbox Ruling


Rest in peace, Belgium gaming. That’s hyperbole.

This week Belgium declared that lootboxes in the fashion of Counter Strike: GO and Overwatch constitute illegal gambling, threatening their associated developers with monetary fines and jail sentences if they don’t comply. This week and the following weeks will no doubt consist of executives meeting with lawyers in board rooms and asking questions like who would they jail, does a Belgian company have jurisdiction over our digital game, and what is the cheaper alternative between either altering our systems specifically for the local market, or pulling out of it entirely.

It isn’t so hard to imagine developers handling the Belgium market in the same way that they’ve taken care of Germany in regards to depictions of the swastika, or other European countries in regards to explicit content in games like South Park. The cheapest and most obvious answer is that companies will, at least in the short term, completely disable the purchasing of loot boxes, including the ability to purchase said boxes with fake currency purchased with real currency, in Belgium to comply with the law. I’m sure developers are currently looking at ways to generate new revenue streams in Belgium without getting on the bad side of the law, and others are looking at lobbying efforts to have that part of the law nullified completely.

Then again, I’m not a bean counter at any of these companies and have no up to date information on exactly how much money is coming out of Belgium. The latest information I can find is from 2011 estimating 220 million euros and climbing rather quickly. Belgium may be a country of about 11 million people, but approximately half of them were gaming in 2011. Again, this is something that individual developers are going to have to assess going forward. One outcome that is definitely not going to happen would be the games removing loot boxes entire from every market, not just Belgium. There is far too much profit to give up for no good (translation: legally required) reason.

I find it hard to believe that the AAA developers are going to pull out of Belgium entirely, although you will see this from smaller publishers for whom the cost of molding their titles around Belgian law don’t justify the kind of sales they would get in the country. At this juncture, that would still be the nuclear option and one that in my humble and admittedly not backed by hard data opinion, seems like there should be plenty of better options available. In order for wide-spread changes to be had in the industry, a substantial part of the market is going to have to follow Belgium’s lead and enact/enforce similar gambling laws.

One thing we can be assured of is that business will not be as usual. Otherwise I have no opinion on the matter.

Consumer Outrage Hurts Stocks, Wipes Out $3.1 Billion In EA Value


It’s not just Disney and consumers who have a reason to be angry at Electronic Arts. Following a consumer revolt over its aggressive microtransaction strategies in Star Wars Battlefront 2, and despite Electronic Arts showing major growth over the past year up 52% year over year, its shares took a tumble after news that the December quarterly sales forecast would be lower than expected due to the performance of Star Wars. Shares of Electronic Arts were down 8.5% through Tuesday, knocking out $3.1 billion in shareholder value.

Physical sales of Battlefront II in the UK dropped at least 50% in the first week, while none of the versions of the title have hit the Amazon top 100 for 2017, which happens to be populated by titles including Mass Effect Andromeda, Splatoon 2, and Horizon Zero Dawn. Analysts are not happy, both with physical sales of Battlefront II as well as

“We were underwhelmed by sell-through for Star Wars: Battlefront II (EA) over the Black Friday weekend, which follows a controversial launch for the game,” Stifel analyst Drew Crum wrote in a note to clients Sunday.

Electronic Arts CFO Blake Jorgensen stated in a speech at the Credit Suisse 21st Annual Technology, Media & Telecom Conference that EA avoided cosmetic microtransactions due to limitations on the franchise canon.

“The one thing we’re very focused on and they’re extremely focused on is not violating the canon of Star Wars,” Jorgensen said. “It’s an amazing brand that’s been built over many, many years. So if you did a bunch of cosmetic things, you might start to violate the canon. Darth Vader in white probably doesn’t make sense, versus in black. Not to mention you probably don’t want Darth Vader in pink. No offense to pink, but I don’t think that’s right in the canon.”

EA’s microtransaction strategy has been incredibly successful in its sports titles from Madden to NBA and Fifa, however the recent expansion of said practice to titles like Battlefront and Need for Speed resulted in a large push back from consumers that executives may not have expected.

(Source; CNBC)