League's Monetization Is In Trouble

Summary

The video delves into the European Union's crackdown on predatory practices in gaming, particularly focusing on the controversial use of premium currencies in microtransactions. It explores how these currencies obscure real-world value, encouraging players to spend more through deceptive bundles and hidden costs. The EU's new regulations aim to protect children and vulnerable players, ensuring transparency and fairness in pricing. The video also highlights how major games like League of Legends and Star Stable Online might be impacted, with a potential shift towards more ethical monetization practices in the gaming industry.

Takeaways

• 😀 Premium currencies in gaming are designed to hide the real-world value of purchases, making it harder for players to recognize the true cost.
• 😀 These currencies are often sold in small bundles that don't provide enough for a purchase, leading to additional buys and more spending.
• 😀 The European Union (EU) is taking action to regulate predatory practices in gaming, particularly those targeting children with manipulative advertising.
• 😀 Premium currencies are seen as a psychological tool, exploiting players' biases and making them more likely to spend money without realizing the full cost.
• 😀 The EU's regulation includes rules against advertising to children and pressuring them into fast purchases or showing in-game items as vital for character well-being.
• 😀 In addition to protecting children, the regulations also aim to safeguard adults by ensuring better transparency of in-game purchases.
• 😀 The EU's new rules require games to clearly show the real-world value of premium currencies, such as Riot Points and V-Bucks, even when converting between different in-game currencies.
• 😀 The regulations could impact major games, including League of Legends, by making developers show the true cost of in-game items and limiting predatory sales tactics.
• 😀 The EU is also addressing the practice of offering multiple types of premium currencies within a game, which could lead to the merging of different currencies in future updates.
• 😀 One of the major changes expected from the EU regulations is that games will no longer be able to sell bundles with mismatched value, forcing them to price items more transparently.
• 😀 While the EU’s move is a step forward, the industry may only see significant changes once a major company, like EA or Riot, faces consequences for non-compliance.

Q & A

What prompted the European Union to take action against predatory practices in gaming?

The European Union took action against predatory practices in gaming due to growing concerns about the manipulation of consumers, particularly children, through microtransactions and premium currencies. This move was triggered by widespread cases of children spending large amounts of money in games without clear understanding of the real value of in-game purchases.

How do premium currencies affect players' spending behavior?

Premium currencies, such as V-Bucks or Riot Points, obscure the real monetary value of in-game items, making it difficult for players to gauge the true cost of purchases. This leads to players either spending more money to complete a purchase or over-buying to cover future expenses, which benefits game developers by encouraging continuous spending.

What specific practices in gaming does the European Union's regulation aim to address?

The EU's regulation primarily targets deceptive advertising practices directed at children, such as pressuring players to make quick purchases or offering limited-time sales. Additionally, it mandates that in-game purchases must clearly display their real-world monetary value, especially when using premium currencies.

Why does the European Union consider premium currencies as problematic?

The EU considers premium currencies problematic because they are used to hide the true value of purchases, which can manipulate consumers into spending more money than they realize. The lack of transparency around these currencies can lead to players unknowingly spending excessive amounts on in-game items.

What is the EU’s stance on the sale of in-game virtual currencies in bundles?

The EU's regulation mandates that in-game currencies must be sold in amounts that match the price of the digital content or services being purchased. This prohibits the sale of bundles that misalign with the actual cost of in-game items, thus preventing overpaying and encouraging more transparent transactions.

What impact could the EU's regulation have on companies like Riot Games?

The EU's regulation could force companies like Riot Games to display the real-world monetary value of premium currencies like Riot Points, even when used to purchase in-game content. This transparency would likely reduce the ability of companies to hide the true cost of purchases and may lead to more ethical pricing models.

How might multiple premium currencies within a single game be affected by the new EU regulations?

The EU's regulations suggest that games should avoid offering multiple types of premium currencies for purchasing in-game items. This could lead to the consolidation of various currencies, such as Riot Points and Mythic Essence, into a single currency system, simplifying purchases and ensuring transparency in pricing.

What are the potential benefits of the EU’s regulations for players?

The main benefit for players is increased transparency. By requiring companies to display the real money value of in-game purchases and eliminating confusing bundles, players will have a clearer understanding of how much they are actually spending. This could reduce the likelihood of overspending and lead to more fair and ethical in-game transactions.

What is the EU's approach to advertising in games directed at children?

The EU's regulation prohibits games from advertising in a way that pressures children into making quick purchases. This includes tactics like offering limited-time sales or suggesting that characters will be harmed unless the player buys something immediately. The goal is to prevent manipulative advertising that targets vulnerable players.

How might the regulation affect gacha-based games, such as Genshin Impact?

The EU regulation could affect gacha-based games by enforcing transparency in the cost of virtual currencies like Primo Gems. While players can earn these currencies for free, any real-money purchase of them will need to clearly show their equivalent value in real money, reducing the potential for players to unknowingly overspend on random rewards.