Predatory Monetization in the Gaming Industry
Part 1
Bank, Damian. “Problematic Monetization in Mobile Games in the Context of the Human Right to Economic Self-Determination.” Computers in Human Behavior, vol. 149, 2023, pp. 107958-, https://doi.org/10.1016/j.chb.2023.107958. Accessed 19 February 2024.
The author of this paper conducted a study to research how consumers of mobile games are exposed to problematic monetization, particularly loot boxes. The paper views the topic through the lens of human rights and whether those rights are violated by predatory monetization. Data obtained from the study led the researcher to conclude that players of mobile games are being financially exploited. The author proposes that human rights protections that are given to people in the real world should be extended to our digital lives. Games use deceptive techniques to manipulate players into spending money and the author of the paper calls out the government for having a lack of regulation in the area. Weaknesses include a lack of specific regulation for the industry and an exclusive focus on mobile gaming.
Banks, James. Online Gambling and Crime : Causes, Controls and Controversies. Ashgate Publishing Ltd, 2014.
Bedingfield, Will. “It’s Not Just Loot Boxes: Predatory Monetization Is Everywhere.” Wired, 28 July 2022, www.wired.com/story/loot-boxes-predatory-monetization-games/. Accessed 20 February 2024.
The author of this article explores a brief history of loot boxes in games before moving on to discuss how predatory monetization has moved beyond loot boxes in many cases. To show how predatory monetization will prevail even if loot boxes are banned, key issues of in-game currency and cost obfuscation are discussed by people within the industry, and other reports are cited. Techniques used by game companies that are similar or identical to casinos, such as free spins, are also discussed. In contrast to what other sources have said, the CEO of a game development studio called the idea of self-regulation “insane” because there is so much money to be made from predatory monetization. Offering a unique look from within the industry, the article is very cynical about the future of monetization in gaming and offers little in terms of suggested regulation.
Dreier, M., et al. “Free-to-Play: About Addicted Whales, at Risk Dolphins and Healthy Minnows. Monetarization Design and Internet Gaming Disorder.” Addictive Behaviors, vol. 64, 2017, pp. 328–333, https://doi.org/10.1016/j.addbeh.2016.03.008. Accessed 20 February 2024.
Gibson, Erin, et al. “The Relationship between Videogame Micro-Transactions and Problem Gaming and Gambling: A Systematic Review.” Computers in Human Behavior, vol. 131, 2022, pp. 107219-, https://doi.org/10.1016/j.chb.2022.107219. Accessed 20 February, 2024.
The authors of this review wanted to investigate the link between video game microtransactions and problem gambling. They looked at 19 different studies and found that a link exists between the amount of money spent on microtransactions and problem gambling. The greater the amount of money spent on microtransactions, the greater the chance of problem gambling. It is recommended by the authors that further research be conducted and that loot boxes should be considered gambling. The review utilizes several lengthy and detailed tables and figures which can be difficult to fully understand but are also very informative.
Johnson, Mark R., and Tom Brock. “The ‘gambling Turn’ in Digital Game Monetization.” Journal of Gaming & Virtual Worlds, vol. 12, no. 2, 2020, pp. 145–163, https://doi.org/10.1386/jgvw_00011_1. Accessed 19 February 2024.
King, Daniel L., and Paul H. Delfabbro. “Predatory Monetization Schemes in Video Games (e.g. "loot Boxes’) and Internet Gaming Disorder.” Addiction (Abingdon, England), vol. 113, no. 11, 2018, pp. 1967–1969, https://doi.org/10.1111/add.14286. Accessed 20 February 2024.
This editorial acts as a summary of the current monetization methods of gaming companies through the lens of addiction. It demonstrates how the systems in place can take the form of predatory monetization and often resemble real-world gambling. Record-high profits boasted by companies employing these tactics are contrasted with large, reported debts by those who are suffering from addiction. The paper concludes that more research needs to be done on the subject and that governmental legislation appears necessary. This can act as a brief and informative introduction to the subject matter, without being too technical or confusing. Someone more knowledgeable on the topic would benefit from looking elsewhere for more in-depth analysis.
King, Daniel L., and Paul H. Delfabbro. “Video Game Monetization (e.g., ‘Loot Boxes’): A Blueprint for Practical Social Responsibility Measures.” International Journal of Mental Health and Addiction, vol. 17, no. 1, 2019, pp. 166–179, https://doi.org/10.1007/s11469-018-0009-3. Accessed 20 February 2024.
King and Delfabbro discuss guidelines for the implementation of potential social responsibility measures in the modern gaming environment. They also discuss the design of games and their in-game purchasing systems. The article describes how games incentivize and obscure the cost of in-purchases and uses information from many previous texts to give a thorough background about gaming monetization at the time of its publication. Despite setting out to offer solutions to the current landscape of predatory monetization in online gaming, this article better serves as a source for information about the current gaming monetization landscape. It can still be a useful resource, but many of its suggested solutions are hypothetical, without any real means of implementing them.
Király, Orsolya, et al. “Gambling Features and Monetization in Video Games Create Challenges for Young People, Families, and Clinicians.” Journal of the American Academy of Child and Adolescent Psychiatry, vol. 61, no. 7, 2022, pp. 854–856, https://doi.org/10.1016/j.jaac.2021.12.003. Accessed 20 February 2024.
Kiraly et al. have written a brief overview of the issues surrounding predatory microtransactions. It focuses particularly on loot boxes, sometimes akin to an online slot machine, and the development of gambling addiction in children. The article acts as a call to arms for more research into the field. With this, the authors hope that increased regulation of gaming companies will occur and more support systems for individuals and children who are addicted to virtual gambling mechanics will be implemented. The article references previous research done to support its points with more credibility. However, due to the brevity of the article, it addresses many topics surface level. It is a call to arms for more research, highlighting topics of intrigue, but does not specify how such research should be done.
Kobialka, Daniel. "Subscriptions are most common monetization method for app developers, study shows." FierceWireless DeveloperQuestex, LLC, 2016. ProQuest, http://libproxy.usc.edu/login?url=https://www.proquest.com/other-sources/subscriptions-are-most-common-monetization-method/docview/1880397313/se-2. Accessed 21 February 2024.
Lakić, Nikola, et al. “Addiction and Spending in Gacha Games.” Information (Basel), vol. 14, no. 7, 2023, pp. 399-, https://doi.org/10.3390/info14070399. Accessed 20 February, 2024
The authors of this study tested the playing and spending habits of people who play gacha games, a subtype of mobile games. Gacha games are most associated with loot box-like mechanics, featuring tactics such as “limited-time offers” to induce player spending. The beginning of the paper incorporates the work of many previous studies to conclude the main demographic of spenders, college-aged students. The research does a good job of showing the responses indicated by survey responders and interpreting them. Most responders to the survey had previously spent money on gacha games and indicated that they had no issue with doing so again in the future. Most responders did not believe that they were addicted to gambling. Due to the nature of the research conducted, there is a potential flaw in the data. Because it was a voluntary survey, the individuals responding to the survey are likely to be the people most invested in gacha games, potentially skewing the data.
McCaffrey, Matthew. “The Macro Problem of Microtransactions: The Self-Regulatory Challenges of Video Game Loot Boxes.” Business Horizons, vol. 62, no. 4, 2019, pp. 483–495, https://doi.org/10.1016/j.bushor.2019.03.001. Accessed 20 February 2024.
This article discusses microtransactions through the lens of business self-regulation. After discussing a brief history of microtransactions and loot boxes, the article focuses on existing and proposed regulations. A major caveat revealed by the article which is likely holding regulation back is a lack of studies demonstrating the link between loot boxes and gambling addiction. Without a clear link, the author proposes that it will be difficult to regulate loot boxes as gambling. The message of the article is clear: it is up to industry competitors to self-regulate for the time being and doing so would likely be in their best interest. Getting ahead of legal regulation via self-regulation will likely lessen the amount of government oversight later. A lack of self-regulation may result in much harsher regulation down the line. This article is a great resource for viewing the topic from the perspective of the industry but lacks some of the ethical discussion found in complaints by customers.
Pathological gambling a critical review. (1999). National Academy Press.
This extensive review focuses on pathological gambling, not limited to online gambling. Subjects discussed include the forms gambling takes, how widespread gambling has become, and how many individuals develop into pathological gamblers. It references many previous studies done on the subject, with a strong bias for more recent data. The review serves a dual purpose, covering aspects of gambling in-depth as well as containing strong recommendations for both governmental bodies and future research groups. This review is an amazing resource to learn about the many forms gambling takes, its social and economic consequences, and support and treatment for those suffering from pathological gambling. This book is not a quick read, as it is long and dense. Another flaw is that this book is over 20 years old, and therefore does not contain the most up-to-date information on the subject.
Sigmon, Kirk A. “PAY TO PLAY: VIDEO GAME MONETIZATION PATENTS AND THE DOCTRINE OF MORAL UTILITY.” The Georgetown Law Technology Review, vol. 5, no. 1, 2021, pp. 72-. Accessed 21 February 2024.
Skolnik, Sam. High Stakes : The Rising Cost of America’s Gambling Addiction. Beacon Press, 2011.
“The History of Video Game Monetization” YouTube, uploaded by KiraTV, 11 May 2022, https://youtu.be/qYu_QxzA5W8.
This video is a great source to learn a brief history of how video game monetization has changed over the last few decades. It summarizes how monetization has evolved from arcade machines to consoles and games, and finally to the modern age of microtransactions. The video mentions a crucial point: while many consider the modern monetization methods of gaming the worst in history, arcade machines were also a terrible and potentially predatory method of monetization. It also demonstrates how monetization trends first seen in MMO RPG games were soon reflected in other genres. Arcade and console games are the focus of the video, which does not discuss mobile gaming. The video ends with speculation about the future of monetization, including the possible implementation of NFTs, which were popular at the time. Since the making of this video, NFTs have declined in popularity, likely making the prediction false.
Wardaszko, Marcin, et al. “Video Game Monetization Mechanisms in Triple A (AAA) Video Games.” ISAGA, vol. 11988, Springer International Publishing AG, 2021, pp. 389–404, https://doi.org/10.1007/978-3-030-72132-9_33. Accessed 19 February 2024.
This paper acts as an excellent guide to the varying types of monetization mechanisms of major (AAA) games. It serves as a way to get familiarized with differing forms of microtransactions and understand how microtransactions are nearly becoming ubiquitous in the industry. The paper references a previous study to claim that there is a strong connection between loot boxes and gambling addiction. This contrasts with several other sources, which claim that most research needs to be done to establish a definitive link. Ethical and moral issues are touched on, but not fully delved into.
Xiao, Leon Y., et al. “Regulating Gambling-Like Video Game Loot Boxes: A Public Health Framework Comparing Industry Self-Regulation, Existing National Legal Approaches, and Other Potential Approaches.” Current Addiction Reports, vol. 9, no. 3, 2022, pp. 163–178, https://doi.org/10.1007/s40429-022-00424-9. Accessed 19 February 2024.
Wu, Jianqing, and Deepti Singh. “IMPLEMENTING STOCHASTIC PRODUCTS SELLING IN MOBILE GAMES: IS GACHA JUST GAMBLING?” Journal of Electronic Commerce Research, vol. 24, no. 4, 2023, pp. 320–337, https://www.proquest.com/scholarly-journals/implementing-stochastic-products-selling-mobile/docview/2865588715/se-2. Accessed 21 February 2024.
Zendle, David, et al. “The Changing Face of Desktop Video Game Monetisation: An Exploration of Exposure to Loot Boxes, Pay to Win, and Cosmetic Microtransactions in the Most-Played Steam Games of 2010-2019.” PloS One, vol. 15, no. 5, 2020, pp. e0232780, https://doi.org/10.1371/journal.pone.0232780. Accessed 20 February 2024.
In this research study, Zendle et. al. explore the exposure to microtransactions that players of the most popular games on Steam might encounter. According to the article, the consensus at the time was that the popularity of microtransactions was on the rise. The researchers tested the validity of the consensus and the types of microtransactions players might encounter and found that there was an increase in exposure to loot boxes and cosmetic microtransactions from 2010 – 2019. Despite the increase in exposure, however, the data did not show that most popular games on Steam contained microtransactions. This study does a good job of analyzing the data it uses and comes up with reasonable explanations for its conclusions. The data utilized for this study comes from a singular source, a weakness that the paper acknowledges and addresses.
Part 2
I had a basic knowledge of the subject of gaming monetization before my research due to my background in playing games. Many of the games mentioned in the articles I read are games that I have played previously or still actively play to this day. As someone in tune with the general gaming community, I am aware of the major issues that people have with games. One of the most consistent complaints about games that I hear is a new game’s monetization, or an existing game changing its monetization tactics to become more predatory.
I have been aware of this issue for years. When browsing social media, I frequently see individuals and articles deriding companies for scummy monetization practices. I’ve mostly chosen to ignore it and not spend my money on offers that I recognize as predatory. That said, I have spent money on microtransactions over the years and I know I wouldn’t be happy if I totaled it all up.
In my experience, free-to-play games generally have the most egregious monetization tactics, but they have always been somewhat excusable due to the free nature of the game. What got me interested in learning more about the subject is the advent of full-priced $70 games containing predatory monetization akin to mobile games. Hearing about one game in particular, the new Suicide Squad game, a $70 game with virtual currency, limited-time cosmetics shop, and a battle pass made up my mind. I was curious to hear what, if anything, was being done about this egregious and predatory monetization.
Many of the sources I read included background knowledge of microtransactions and the history of monetization in the gaming industry. Familiar as I am with modern practices, many pieces of information still surprised me. Before researching, I thought I had a relatively complete view of the evolution of monetization. Many of the early texts I read confirmed this thought. However, the YouTube video I watched on the topic surprised me. It brought up a point that nothing else had so far: monetization of the video game industry began egregious. Arcade machines began with a play-to-play model and only later evolved into the console and game purchase system I am familiar with. It made me recontextualize the industry into something that had always been predatory, as opposed to an industry that had recently developed predatory tactics.
I occasionally see articles or hear news about potential regulations for predatory monetization. As I looked into the topic more, I was surprised to see how little there was, which does make sense considering how widespread the issue is. Many articles I read came to one of two, or even both, conclusions: loot boxes should be considered gambling and should be regulated as such, and more research needs to be done in the field. The second point, that more research needs to be done in the field, is something I can attest to. While most sources I came across offered valuable information, many also contained a lot of repeat information. More research, and a diversification of that research, is needed. The issue of predatory monetization in gaming is extremely widespread, and regulators need to be doing more to reign it in. An expansion of support systems is needed because those in place to assist gambling addicts have no framework for helping those addicted to in-game gambling.
The genre of writing that I think will best serve my needs on this topic is an op-ed or an editorial. This would allow me to report my research and share my opinion with other individuals who might be concerned about monetization in gaming. It is also important that I try to get more of the public aware of how gaming companies are exploiting their customers. The more people in the public who are upset about this issue, the more likely that legislation will be passed to put a stop to it. While I don’t want to emotionally manipulate any readers, I would want my text to get them rightfully upset at the current state of things.
If people can concisely understand the current state of predatory monetization in the gaming industry in an article that also encourages them to get involved, then real change is possible. It certainly won’t be easy and will likely take more than a single article but change needs to happen. Unethical and immoral business practices shouldn’t be allowed to continue simply because no one cares enough to do anything.