European Consumers’ Association Slams Video Game Monetization Systems

How many times have we talked about the video game monetization systems, often calling them predatory and manipulative? Well, the European Consumer Union Office thinks the same, or BEUCwhich, together with 22 other organisations from member countries (Adiconsum and Altroconsumo for Italy), sent a formal complaint to the European Commissioncomplaining about the unfair practices adopted by most video game publishers regarding in-game purchases.

The BEUC’s conclusions come after an in-depth study of the matter, according to which many purchases of digital goods in games are made in violation of the law protecting European consumers. Hence the request for their ban, with a call to action for the European authorities, who will have to decide on the matter.

Call to action

The text of the complaint also mentions some games: Fortnite, EA Sports FC 24, Minecraft and Clash of Clans. It then highlights the ways in which publishers would maximize user spending, in particular through the use of in-game coins (the so-called premium coins):

• Consumers cannot see the real cost of digital items, which leads to overspending: The lack of transparency of premium currency prices within games and the need to purchase extra currency within bundles pushes consumers to spend more. In-game purchases should always be displayed in real currency (e.g. Euros), or at least should show the equivalent price in real currency.
• Claims by companies that players prefer premium in-game currencies are false: many consumers find the switch unnecessary and misleading and prefer to purchase items directly with real money.
• Consumers are often denied their rights when using premium in-game currencies, tied to unfair terms of use that favor developers.
• Children are even more vulnerable to these manipulative tactics. Data shows that children in Europe spend an average of €39 per month on in-game purchases. While they are among the most active gamers, they have limited financial literacy and are easily influenced by virtual currencies.

BEUC also provided background to the complaint, giving an overview of video game consumption in Europe: “More than half of EU consumers regularly play video games. Kids are playing even more: 84% of them are between the ages of 11 and 14. In 2020, in-game purchases generated more than $50 billion (about €46 billion) in revenue globally, accounting for about a quarter of the video game market revenue.

The video game industry generates more revenue from in-game purchases than the film and music industries combined.. In recent years, video game companies have developed business models that increasingly rely on in-game purchases, including in-game currency. Premium in-game currencies are widely available on the market.

An assessment of 50 of the most played video games in 2023 showed that 21 of them (42%) include premium currencies. Of those 21 games, 8 have an age rating of 12 or below. The reported issues extend beyond video games and also apply to social media platforms and other markets. BEUC already pointed out in 2021 that TikTok was unclear about how much its virtual currency was worth.

Finally, BEUC hopes that European consumer protection laws will be applied to the video game industry and that new regulations will be introduced in this area.