Australia Calls for End to Video Game Gambling

The Centre for Responsible Technology in Australia has called for a tightening of video game ratings that promote gambling. The effort comes in response to a number of studies which suggest there is a deep link between the onset of gambling addiction in adulthood and playing video games that encourage gambling.

Two children gaming together.

There is a substantial amount of attention being focused on the video game industry as regulators are trying to limit the access and availability of gambling products to children. The CRT ascertains a link to problem gambling in adulthood as a result. ©StartupStockPhotos/Pixabay

The specific aspects of video games that are causing concern are games of chance, where the player has to risk in-game capital to gain a reward. The much utilized ‘lootboxes’ have been heavily criticized as “gambling aimed at children”.

The Centre for Responsible Technology initially launched the investigation into the societal impact of gambling in 2019, but last week they submitted their final gambling on games report to the Department of Communications. The 35-page report is incredibly thorough in its analysis and makes a series of recommendations regarding the classification system for video games; highlighting the design of games, and the mechanics of loot boxes as key areas of concern.

On the flip side, there are vocal proponents of creative freedom for video game developers to design and build games as they wish. After all, as they argue, there is no aspect of true gambling in their games, as the objects rewarded in the game can be kept, unlike losses in gambling. With different countries taking drastically different approaches to this issue, it has become a difficult regulatory tightrope for game developers to navigate in the past few years.

Recommendations of the Centre for Responsible Technology

At a very fundamental level, video games have a tendency to reward players with prizes in an uncertain consistency and value. This so-called variable ratio reinforcement, where behavior is rewarded and penalized unpredictably is a phenomenon often utilized by game producers to manipulate behavior.

Nowadays, gambling aspects are highly present in games that are marketed at children. This, argues the Centre for Responsible Technology, is especially concerning since based on statistical evidence; two in three Australians play video games, with over 81% of those regularly playing aged between 5 – 14.

The Centre for Responsible Technology is seeking to change the structure of the game classification system in Australia. In its current form, the classification agencies consider the “interactivity”, that being the degree to which the player participates as an aggravating factor since there is a fundamental difference between participating in violent behavior rather than watching as a non-interactive bystander. However, other risks posed by video games like in-game purchases, ability to chat in-game with other players, sharing players’ personal data, risk-taking for reward opportunities (i.e. gambling) are not considered when classifying the age limit of games.

Essentially, as the report has uncovered, there are four forms of gambling in video games. Which we will cover briefly below.

The presence of gambling and gambling technologies in video games is widespread, pernicious and often hidden. This report identifies four different categories of gambling– gaming crossover, each of which poses different risks and may need to be addressed in different ways: immersive and addictive technologies, simulated gambling, gambling within games and gambling via games.Bill Browne The Australia Institute for Responsible Technology

Immersive & Addictive Technologies in Video Games

Modern games often benefit from players engaging in prolonged gaming sessions; they may offer paid subscriptions, run in-game advertisements and/or charge players to keep playing by including micro-transaction functionality. All of this is optimized and increased by exploiting certain aspects of human psychology. Ratio reinforcement, and the disassociation of spending real money by using in-game currency, is a big part of this. As the Centre for Responsible Technology argues:

“Whether “addiction” is the right term to use for playing video games extensively in a way that negatively affects a person’s life is disputed, but some players certainly experience negative effects in the rest of their lives from the video games that they play – and gambling elements are used in video games to keep players playing beyond when they would otherwise stop.”

Simulated Gambling

By normalizing and promoting gambling within the game, young children can develop the vulnerability of becoming problem gamblers in the future. As well as romanticizing the practice of gambling, these in-game gambling experiences can be often very deceptive, and not offer true odds or rewards to the players. For example, gambling with virtual currency players can often win huge returns on their starting stake, which is unrealistic in the real terms of gambling. As the Centre for Responsible Technology argues:

“This sensation of effortlessly making money is dangerous if it leads players to assume the same is likely on real poker machines with real money.”

Buying Chance Based Items

Loot boxes, they are becoming increasingly common in all forms of video game. From free mobile games to high-profile console titles such as Fifa and Call of Duty. These loot boxes are bought for real money, and contain random virtual items, which in some games can be traded with real players, and bought for real money. The link between loot boxes and problem gambling is significant, and in 2019 a survey found that link between loot boxes and problem gambling is stronger in adolescents aged under 18 than in adults. Countries are waking up to the harm being caused, Belgium has legislated against the “illegal form of gambling”.

“The more money that older adolescents spent on loot boxes, the greater their problem gambling severity. Older adolescents who spent money on loot boxes displayed more than twice as high measurements of problem gambling than those who did not. Adolescent problem gamblers spent more than five times as much money on loot boxes than those who did not have a problem.”

Skin Betting & Gambling via Games

Skin betting took off following the innovation by Counter Strike producer’s Valve. The skin-betting mechanism allows players to bet with the skins, which often hold real-world value. By accessing third-party sites, skins can be used to bet of sportsbook markets, jackpot, roulette and coin-flips. Of all aspects of video games that have questionable gambling content, this is perhaps the most blatant breach of the ethical boundaries that the Centre for Responsible Technology.

The relativeness to real gambling is substantial in skin betting, and simply by existing in the medium of a video game it has slipped under the radar and escaped the scrutiny of typical regulations. A crackdown has followed a major evaluation of skin-betting in 2019, and the market will certainly be reigned-in during 2020.

Conclusion and Recommendations

Gambling content in video games is rife, and there are clearly inadequate safeguards to prevent children from participating in any or all of this content. There is a major contradiction between the strict laws imposed to prevent children gambling (i.e. Know Your Customer, age verification) and then the easy availability and access children have to gambling opportunities via video games. The classification must address these gambling themes listed above in their classification system to lower the risk to children, as well as much broader fundamental changes in what is appropriate content for video games aimed at children.

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