Multibillion-Dollar Loot Box Industry Under Fire As Campaigners Urge Regulators To Investigate FIFA Video Game Maker

Topline

A letter Thursday from several advocacy groups called for the Federal Trade Commission to investigate FIFA video game maker Electronic Arts over its loot box feature in games, a controversial practice that rakes in billions of dollars for the video game industry that has thus far escaped scrutiny from the American government.

A Fifa 22 video game on the shelves at a store in Louisville, Kentucky in January.

Key Facts

The letter, signed by more than a dozen organizations including children’s advocacy, consumer rights and gambling support groups, alleges EA “unfairly exploits children and teens for profit” with their loot boxes.

Loot boxes are virtual content packs or treasure chests that unlock certain features in a game that almost always come with a real-world price tag, which in this case is FIFA’s immensely popular “Ultimate Team” feature, where players can buy and open packs containing soccer players to add to their fantasy team.

Loot boxes accounted for $15 billion in revenue across the video game industry in 2020, according to Juniper Research.

During the 2021 fiscal year, net revenue from extra content sales in EA’s “Ultimate Team” game modes—what many would classify as from loot boxes—was $1.6 billion, according to the company’s annual report, a “substantial portion” of which came from FIFA.

Chief Critic

‘’We design our games to offer choice, fun, fairness and value for our players. In all of our games, including FIFA, spending is always optional, and most players choose not to spend at all,” EA spokesperson Charlie Fortescue said in a statement to Forbes. “We encourage the use of parental controls, including spend controls, that are available for every major gaming platform, including EA’s own platforms.”

Key Background

The FTC has largely avoided addressing loot boxes except for a 2019 workshop that outlined the associated risks with the practice. However, European countries have been quicker to link loot boxes to problem gambling and legislate against it. A 2021 study by University of Plymouth and University of Wolverhampton researchers found loot boxes “are structurally and psychologically akin to gambling.” American video game maker Activision Blizzard called off the release of its “Diablo Immortal” game in Belgium and the Netherlands this week, reportedly due to the countries’ loot boxes laws. In 2019, EA stopped selling “FIFA Points,” which cost money and can in turn be used for packs, in Belgium due to its loot boxes laws. The United Kingdom will soon publish a report on loot boxes amid calls from lawmakers to treat the practice as gambling.

Contra

Dutch courts overturned a €10 million ($10.7 million) fine against EA in March after it sided with the video game company’s argument that the game’s loot boxes are not a required part of gameplay.

Crucial Quote

“Any events or circumstances that negatively impact our ability to reliably provide content or sustain engagement for Ultimate Team, particularly FIFA Ultimate Team, would negatively impact our financial results to a disproportionate extent,” EA said in its 2021 fiscal year financial report.