HOUSE OF REPRESENTATIVES

H.C.R. NO.

224

THIRTIETH LEGISLATURE, 2019

H.D. 1

STATE OF HAWAII

 

 

 

 

 

HOUSE CONCURRENT

RESOLUTION

 

 

CONVENING A DIGITAL GAMING ADVISORY GROUP TO ASSESS AND MONITOR GAMBLING AND PREDATORY PRACTICES IN THE DIGITAL GAMING INDUSTRY.

 

 

 


     WHEREAS, in recent years, gaming industry developers have begun to employ predatory variable reward mechanisms known as "loot boxes," which operate similarly to slot machines, in digital games marketed to adults and children of all ages, through which players can pay real money for chances to win randomized virtual items of varying value; and

 

     WHEREAS, digital and physical variable reward mechanisms such as casino slot machines and digital loot boxes are designed to exploit human psychology to cause repetitive consumption, which maximizes player spending; and

 

     WHEREAS, on numerous occasions, studies have found negative psychological impacts from extended exposure to exploitive variable reward mechanisms, which can lead to addiction and cognitive development problems in particularly vulnerable youth, leading countries such as China, Belgium, the Netherlands, and others to begin to regulate or ban predatory variable reward mechanisms such as digital loot boxes in video games; and

 

     WHEREAS, in the United States, departments and agencies heavily regulate exploitive variable reward mechanisms in casino games to minimize negative impacts on mental health, particularly in developing youth, and ensure transparency and basic consumer protections by requiring strict disclosure to consumers of the odds of winning possible rewards contained within; and

 

     WHEREAS, there is currently no requirement or oversight for digital game developers to disclose to consumers the odds of winning any rewards within predatory variable reward mechanisms such as digital loot boxes, and it has already been discovered that in some games, the odds of winning particular items frequently advertised to consumers were, deceivingly, just fractions of one percent; and

 

     WHEREAS, there is no requirement for digital game developers and publishers to disclose to consumers the specific inclusion of predatory variable reward mechanisms such as digital loot boxes in games being sold to the public, making it impossible for parents to know which games contain these mechanisms and which games do not; and

 

     WHEREAS, when called upon to inform parents and include specific disclosures of which games contain predatory variable reward mechanisms such as digital loot boxes, the game industry responded by hiding their inclusion behind a blanket disclosure on all games which contain any type of in-game purchases, making it impossible for parents to distinguish between games that allow purchases of regular in-game content and those that include predatory variable reward mechanisms such as digital loot boxes; and

 

     WHEREAS, through regular online updates that often occur long after the purchase of a game, game developers and publishers have been inserting predatory variable reward mechanisms such as digital loot boxes into games without meaningful player or parental knowledge; and

 

     WHEREAS, in 2017, game developers filed patents to further expand predatory game design by raising or lowering the odds of winning items within exploitive variable reward mechanisms such as digital loot boxes to match the likelihood that specific players will continue to spend money, potentially lowering the odds of winning valuable items for players identified as likely to continue purchasing chances to win; and

 

     WHEREAS, seeing opportunities to further compel in-game purchases, game developers have begun designing games to increase difficulty and time required to achieve in-game objectives and increasingly stack players of mismatched strength against one another in multiplayer games to encourage greater numbers of consumers to purchase predatory variable reward mechanisms such as digital loot boxes to win items that would more easily enable successful play; and

 

     WHEREAS, unlike traditional games of chance, baseball cards, and other randomized novelties, video games require active, lengthy participation during which consumers are exposed to the psychological manipulation techniques employed by exploitive predatory variable reward mechanisms such as digital loot boxes that aggressively compel spending and can lead to psychological and developmental harm; and

 

WHEREAS, the American Psychological Association has identified "internet gaming disorder" in the Diagnostic and Statistical Manual of Mental Disorders as an emerging diagnosis that warrants further study; and

 

WHEREAS, the World Health Organization has identified "gaming disorder" alongside gambling as a pattern of gaming behavior that appreciably increases the risk of harmful physical or mental health and included "hazardous gaming" as a threat to public health in the latest draft of its International Compendium of Diseases; and

 

WHEREAS, with no requirements for disclosure, transparency, or basic protection against predatory and exploitive practices, countless families, individuals, and particularly vulnerable youth have been harmed by exposure to the predatory variable reward mechanisms such as digital loot boxes now aggressively marketed to players of all ages on personal computers, gaming consoles, and the mobile phones in people's pockets; now, therefore,

 

     BE IT RESOLVED by the House of Representatives of the Thirtieth Legislature of the State of Hawaii, Regular Session of 2019, the Senate concurring, that a Digital Gaming Advisory Group is convened to examine, assess, and monitor gambling and predatory practices in digital games and their potential impacts on the public; and

 

     BE IT FURTHER RESOLVED that the advisory group shall examine, assess, and monitor evolving gambling and predatory practices in digital video games which may present a potential public health or consumer risk, potential negative impacts to the public, provide for education and awareness, and make recommendations; and

 

     BE IT FURTHER RESOLVED that the advisory group shall be co-chaired by the Chairs of the House and Senate standing committees with subject matter jurisdiction over Judiciary and shall include the Attorney General or designee, the Director of Consumer Protection or designee, and Director of Health or designee, and others with relevant oversight or experience invited by the advisory group's co-chairs, all of whom shall serve without compensation; and

 

     BE IT FURTHER RESOLVED that the Legislative Reference Bureau is requested to provide final drafting support to the advisory group for its reports; and

 

     BE IT FURTHER RESOLVED that the advisory group is requested to submit a report of any findings and recommendations as may be necessary, no later than twenty days prior to the convening of each Regular Session; and

 

     BE IT FURTHER RESOLVED that the advisory group shall cease to exist on June 30, 2024; and

 

     BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Governor, Attorney General, Department of Commerce and Consumer Affairs, Department of Health, and Legislative Reference Bureau.

 

 

 

Report Title: 

Gaming Advisory Group