Notes on EU's New Rules on Premium Currency in Games

Introduction

• The European Union (EU) has introduced new rules on premium currencies in video games.
• Aimed at eliminating manipulative practices and predatory monetization tactics in the gaming industry.
• Significant impact expected on companies like Ubisoft, CD Project, DICE, Remedy, etc.
• Could change game monetization practices globally.

Context

• Digital Fairness Act: Proposed in September 2024.
  • Targets dark patterns in video games.
  • Focus on practices that exploit vulnerable users, especially minors.

Economic Impact

• Video games are a significant business in the EU.
• Online game spending majorly contributes to revenue.
• Concerns arise over manipulative tactics targeting children.
• Example: Children spending an average of 31 euros a month on online games.

The Case of Star Stable

• Star Stable: A game about horses targeted for its predatory monetization practices.
• Swedish Consumer Agency filed a complaint against Star Stable Entertainment.
  • Allegations of targeting children and using harmful commercial practices.
• Findings confirmed unethical practices like direct appeals to children and lack of transparency.

EU's Proposed Changes

• Consumer Protection Cooperation Network (CPCN) outlines desired changes:
  • Allow buying exact currency needed, eliminate excess purchase.
  • Refund policies for digital purchases.
  • Ban on fear-of-missing-out (FOMO) tactics.
• Aim: To make gaming environments more trustworthy.

Industry Response

• Industry bodies express disappointment.
• Concerns over potential disruption and growth challenges.
• Claims that new principles could restrict consumer access to games.

Potential Industry Impact

• Big companies might absorb costs and adjust monetization models.
• Smaller companies may struggle to comply.
• Threat of geo-restriction for EU players by major companies.

Broader Implications

• EU's actions could set a precedent affecting gaming industries worldwide.
• Potential dilemma for companies: Offer more transparent pricing in EU vs. rest of the world.
• Could lead to disparity between gaming experiences for EU and non-EU players.

Conclusion

• EU's regulations challenge current monetization models.
• Enforcement is crucial for new rules to have a lasting impact.
• Potential shift towards fairer gaming practices.
• Highlighted through the example of a niche game, Star Stable, but implications are vast.
• Future of game monetization may see a shift towards consumer-friendly practices.

Note: This summary is based on a lecture discussing the European Union's impact on game industry monetization practices, with a focus on premium currencies and consumer protection.