FTC Report Suggests Game Companies Pay Streamers To Market Loot Boxes

A recent FTC report has revealed that game companies are looking to pay popular streamers to market loot boxes in an increasingly deceptive fashion.

As pressure continues to mount against loot box mechanics in video games, it has been revealed today that an unnamed publisher has proposed misrepresenting how loot boxes work to a viewing audience.

Omeed Dariani, CEO of Online Performers Group (OPG), a management company for YouTube and Twitch celebrities, also stated that it is frustrating attempting to disclose paid advertisements during livestream events due to the nature of streaming, whereby viewers come and go as they please without any way of knowing who has the information.

Via: gamespace.com

The issues were raised today and broadcast live online in a loot box workshop that was hosted by the U.S. Federal Trade Commission (FTC). There, Dariani was asked a question by the FTC’s Brittany Frassetto:

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“Based on your expertise, do video games [publishers] pay these content creators to open loot boxes? Do they pay for the loot boxes? And, if so, do they at times give them better odds than the public at large? And how much of that is disclosed?”

Dariani responded in the affirmative, whereby companies pay or provide loot boxes for a content creator to open on their stream. The problem was that he followed up by stating, “I’ve definitely been in a room where a publisher said, ‘We could do better odds on the packs that this person opens for promotional purposes.’” This only occurred once, and the idea was not presented to him again.

However, such a proposal to provide loot boxes where the odds have been adjusted or predetermined is highly problematic as viewers would be deceived and misled about the actual probability of replicating such an unboxing, as it is sometimes called.

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Dariani continued by describing he found it surprising that streamers are not ashamed to admit that they are sponsored for such loot box opening events.

However, no one should be surprised to learn this. Most streamers often strive to eventually reach a level of popularity to attain some manner of sponsorship. Monetization of content is difficult to achieve in a saturated market, and any manner of sponsorship is often welcome, especially if like loot box opening, the activity serves to further drive viewership. In a culture where dishonesty to the viewers is a crime punishable by scandal, openness about sponsorship is seen as a virtue.

Developers already pay the most popular streamers large sums of money to play their new games for a pre-determined period of time following release. This makes a game seem far more popular that it actually as, showing up on Twitch as having a high number of viewers, when in reality it is simply a well-known streamer playing a new game and using their existing fan base to drive viewership.

Most recently we saw this with developer and publisher Saber Interactive paying popular streamers to play their new game, World War Z, for the first two days following launch. The game was in the top three of Twitch viewership, and the company was sure to tout this to drive sales. Michael “Shroud” Grzesiek was one such popular streamers paid to play the game.

Via: dexerto.com

On the third day, once these streamers were no longer being paid to play the game, viewership tanked more than 80%.

Both practices of paying streamers to open loot boxes and to play a new game after launch without clearly indicating that such an agreement has been made should be considered deceptive. Much in the same way that Instagram is now more actively enforcing that its post must be clearly marked as an ad or as sponsored, content creators too should have some clear message available throughout a period of sponsored work to let viewers know that they are in fact watching a commercial, rather than the content they expected from a streamer.

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