FIFA loot boxes deemed illegal gambling in Austria
Sharpr is a weekly newsletter covering the intersection of esports and betting
Hi everyone, Cody here.
There’s absolutely no shortage of stories this week. From a swell of announcements in the esports betting sector to the streamline of discussions held at iGaming Next NYC. Hell, even Snoop Dogg is making rounds in the press with his latest crypto casino partnership.
On top of that, WWE is lobbying with regulators to legalize sports betting on its matches. BetMGM was asked if it would take wagers on WWE during a panel yesterday, to which CEO Adam Greenblatt replied “NFW.”
Let’s dig in.
In this week’s edition of Sharpr…
FIFA loot boxes deemed illegal gambling in Austria.
Betfred expands esports offering through PandaScore deal.
Luckbox nets record growth figures in February.
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FIFA loot boxes deemed illegal gambling in Austria
An Austrian court has ruled that loot boxes in FIFA are a form of illegal gambling in a lawsuit against Sony Interactive Entertainment.
The court decided that the randomized contents of FIFA Ultimate Team packs, which can also be sold on a secondary market for real-money value, violate Austria’s gambling laws.
Austria isn’t planning a nationwide ban of loot boxes in the country, but the FIFA Ultimate Team packs must now be classified as “gambling games that require a license.”
The verdict requires Sony to refund payments of approximately $350 to a group of PlayStation FIFA players involved in the lawsuit.
Rightfully, many people have wondered why FIFA publisher Electronic Arts is not being targeted in the lawsuit. That’s because the loot boxes were purchased through the PlayStation Store, meaning that the users' purchasing contracts are with Sony, not EA. Sony will have an opportunity to appeal the decision to refund players.
Padronus, a German law firm that specializes in recovering losses from online casinos, told GamesWirtschaft that more than 1,000 FIFA users have contacted the company to file claims averaging roughly $840. The firm says that some extreme cases have been as high as $89,000.
FIFA has been the source of loot box controversy for several years now. Similar debates to this have been held in Dutch and Belgian courtrooms with regulators from both jurisdictions banning loot boxes in 2018. However, a study conducted in August revealed that Belgium’s loot box ban wasn’t being enforced.
🦈 Sharpr Take: The loot box paradigm may be a never-ending debate in this space.
As outlined in the aforementioned study, the ban failed to prevent the sale of randomized items in games to consumers. Approximately 82% of the 100 highest-grossing Belgian iPhone games in May 2021 had loot box features. Of that, 80.2% of games were rated suitable for players ages 12+.
In some ways, this highlights the unassailable nature of this conflict. It’s an impossible task for gambling regulators to oversee the entire video game industry and its doings with the level of detail needed to prevent this practice with conviction.
The paper notes that the unenforced ban has had two effects:
Giving consumers, parents, and policymakers a false sense of security.
Allowing non-compliant games to replace titles (like FIFA) that have been removed from the national market by more socially responsible companies.
It’s hardly the consumer protection that regulators were likely hoping for, and as with most other legislation, seems to be pushing loot boxes further into black market territory.
It also begs the question, just how far should a nation’s gambling commission reach be in regulating video games? Ollie Ring says that poses “far more questions than answers.”
Betfred expands esports offering through PandaScore deal
Odds supplier PandaScore has entered into an agreement with Betfred to “supercharge” its esports offering.
Betfred’s new offering will provide customers with access to more than 300 unique markets across 32,000 esports events annually.
PandaScore will additionally provide custom tools and widgets, including its esports BetBuilder – a multi-bet building tool.
The partnership will launch later this year, available to Betfred’s online sportsbook customers in the UK.
Betfred Trading Director Craig Reid said the bookmaker is looking to “engage a wider audience” through its online product and noted that there’s a “strong appetite for esports betting in the UK.”
One of the increasingly more evident benefits of esports betting underlined by Reid’s statement is its ability to engage a generation of digitally-native sports bettors.
Given esports is still an untapped category (relative to the emphasis on traditional sports betting products), adding a sophisticated product such as this is also able to help differentiate Betfred from other bookies.
Luckbox nets record growth figures in February
Luckbox has put up record figures in the month of February, the company announced on Tuesday.
The company recorded $2M in betting handle, a monthly record which surpassed the $1.15M generated in January.
Revenue also grew 110%, driven mostly by player margins–ARPU increased by 127% month-over-month.
Luckbox’s registered player base has grown to 350K.
The company says it will continue to focus on increasing betting handle and player margins as key performance indicators in its B2C business.
Real Luck Group CEO Thomas Rosander added that “several top-tier betting operators” are exploring its B2B live micro-betting product.
🗞 In the news
Rivalry has struck a partnership with Grayhound to extend its market share in Australia.*
Snoop Dogg has entered a partnership with Roobet.
WWE is in talks with Colorado and Michigan regulators to legalize betting on key matches.
📈 By the numbers
Gamers8 has announced a $45M esports tournament hosted in Riyadh, Saudi Arabia.
FanDuel commanded a 20% share of US online casino GGR in Q4 2023.
Parlay wagers made up more than 60% of New Jersey sports betting GGR, up 20% from 2019.
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*Disclaimer: I am a full-time employee of Rivalry.