Electronic Arts (EA), one of the largest videogame developers in the world, has come under fire from lawmakers in Hawaii and Belgium for allegedly promoting online gambling directed at children with their latest title, Star Wars: Battlefront 2. Battlefront 2, like numerous other titles, uses a loot-crate system whereby players can acquire certain goods in the game by opening digital “crates” containing unknown items. In a number of games, these crates contain cosmetic items unrelated to game progression. For instance, in the World War I-based multiplayer game Battlefield 1, crates contain items allowing players to modify the appearance of weapons, uniforms, and vehicles. Battlefront 2, on the other hand, links loot crates directly to game progression, meaning that without the items contained in the crates, there is no way for players to advance the quality and abilities of the character(s) they play in the game.
When Battlefront 2 launched a couple of weeks ago, players were given two routes whereby to acquire crates: (1) acquire in-game credits rewarded on the basis of gameplay which can be used to make in-game purchases of new crates; or, more controversially, (2) pay real-world money to purchase “crystals” (another form of in-game currency) that can also be used to make in-game purchases for new crates. Almost immediately, EA found itself embroiled in controversy as players claimed that EA was creating a pay-to-win system for the game since more crates, even with their contents unknown in advance, mean a greater likelihood of acquiring weapons and abilities inextricably linked to game progression. The controversy grew so heated that allegedly Disney, the owners of the Star Wars franchise, stepped-in to force EA to shut the pay-for-crates system down (at least for the timebeing).
Even so, lawmakers and other observers began to cast critical light on loot crates generally, arguing that any system whereby players can purchase these digital goods full of unknown items constitutes a form of gambling. Moreover, since videogames like Battlefront 2 are marketed toward young people, critics have taken the further step of accusing EA of promoting gambling for minors. Do they have a point? Yes and no. On the one hand purchasing loot crates is a gamble; sometimes the crates contain important and valuable goods, and sometimes they contain redundant items or items unrelated to in-game progression. On the other hand, purchasing these crates, typically through an online store run by videogame-system manufacturers such as Microsoft or Sony, requires a debit or credit card which, in theory, only adults should be able to use. If a parent wants to pay for their child to have more crates, what’s the harm? Sure, it may lead to the aforementioned problem of “pay-to-win,” but it is not necessarily illegal.
While EA has (temporarily?) discontinued the pay-for-crates system for Battlefront 2, a dark cloud now hangs over the loot-crate system as a whole. With EA and other game developers likely hinging their future fortunes on players purchasing crates for a variety of games in the future, lawmakers are apt to scrutinize the system further. The problem for lawmakers, at least at the state level, may not be able to do anything of substance since multiplayer games like Battlefront 2 and other titles that use the loot-crate system cross state lines for players. If Hawaii bans loot crates, all that does is place Hawaiian players at a competitive disadvantage vis-à-vis players from, say, Michigan or New York. Arguably, state-based regulation would raise issues under the Commerce Clause of the U.S. Constitution.
Should federal lawmakers enter the picture, then EA and other videogame producers may find a promised pool of revenue dry-up in a hurry. Without the loot-crate system, manufacturers will have to go back to the drawing board on how to further monetize their titles—hopefully without the attendant controversy the loot-crate system has created.