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FTC Mailbox Survey: What Happens Next?



To date, the US Federal Trade Commission's public participation in video game chests has been limited to one word. At a meeting of the Congressional Oversight Committee on Tuesday, FTC President Joe Simons responded "yes" to a request from Senator Maggie Hassan (DN.H.) asking the organization to review and report on the surprise boxes.

What are we doing now? And is the FTC likely to impose legal restrictions on surprise boxes? These devices in the game offer consumers a chance to win items in the game, sometimes in exchange for money. They were compared to the game.

A spokesman for the FTC said: "We have nothing to add for the moment" to Simons' claim. However, the Commission applies a standard set of procedures when investigating individual firms or entire industries, providing useful clues for future events.

I spoke to Bill Rothbard, a former FTC lawyer who is now specializing in FTC-related work. "They have a number of different procedures, ways and remedies to pursue an investigation," he said. "If they are considering a practice that touches the entire industry, like the surprise boxes, they have the legal authority to initiate a rule-making process."

A rule-making procedure is essentially a public meeting at which interested parties can present their arguments to the FTC. Representatives of gaming companies would be obliged to answer questions from the FTC about the boxes. Public interest, consumer groups and anti-loot boxing activists, such as those who think this practice is a gateway to the game, would express their views, including the results of the research.

"The FTC would determine if the chests are unfair or misleading," said Rothbard. "If this is the case, it would justify the promulgation of a regulation covering the entire sector".

The FTC is empowered to adopt rules that have the force of law. In theory, the FTC could call a rule-making procedure and ban vaults. However, this scenario is unlikely.

"In the late '70s and early' 80s, the FTC had initiated numerous proceedings against entire industries," Rothbard said. "Advertising for children, tobacco, the funeral industry and real estate, for example. But I can not think of one that covers the entire sector in recent years. "

Rothbard said the FTC is less liberal than in the past and is reluctant to adopt new rules governing entire industries.

But an inquiry has been promised and will go forward. This will probably take the form of letters sent by FTC staff lawyers to gaming companies requesting information about their activities and the operation of the vaults.

"They will want to know how they sell the safes, their impact on their businesses and all that is relevant," said Rothbard.

If gaming companies are slow to respond, the FTC has the opportunity to send a civil inquiry, which has the force of a subpoena, requiring companies to fully respond.

Video game companies are represented at the government level by the Commerce Entertainment Software Association. It is likely that ESA will intervene and negotiate directly with the FTC, exposing the case of game companies for surprise boxes. This week's statement from the ESA to the media gives an idea of ​​its strategy, which strongly denies that gambling crates are gambling-related.

"Chests are a means by which players can enhance the experience that video games offer," ESA said. "Contrary to assertions, chests are not games of chance. They have no real value, players always receive something that enhances their experience and they are entirely optional to purchase. They can enhance the experience for those who choose to use them, but have no impact on those who do not. "

It is also likely that ESA will highlight market forces that have changed the approach of gambling companies to surprise boxes. The year since the release of Star Wars Battlefront 2, which was notoriously geared towards the sale of surprise boxes, companies have moved away from the box of surprises. FortniteThe fashionable "season passes", which allow players to gain assets they would otherwise find in chests, are now in fashion. They do not carry the negative connotation of surprise boxes which, despite ESA's denials of gambling, have a significant element of chance.

Today, the International Association of Game Developers Association has warned video game companies to act and avoid legal decisions at the government level. Legislators from countries such as Japan, Belgium and the Netherlands have indicated their willingness to fight against surprise boxes, an initiative that would disrupt gambling companies. Executive Director Jen Maclean called for action by the gaming industry, including a commitment to stop marketing loot boxes to children, disclosure of all odds of receiving rewards and a campaign education.

"By taking no meaningful action as an industry and international game developer community to self-regulate the use of loot boxes," added Maclean, "we run the real risk that governments around the world take this action for us significantly restrictive laws that could impact random reward elements in games. "

In the course of its negotiations with the FTC, ESA may propose one or more of these measures as a last resort, but it is more likely to seek to win the argument and avoid any form of concession. Meanwhile, consumers have shown growing hostility toward booty boxes, which appear to be in decline. This change will certainly contribute to the FTC's innate resistance to industry interference.

"If the video game industry feels exposed here, it could go directly to the FTC and try to convince it that its concerns about the boxes are unjustified and unfounded," said Rothbard. "The best outcome for them is to engage in an exchange of information in cooperation with the FTC and make them aware of the industry's point of view, and to determine that there is really no problem right here."


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