Play the game to see how video games are designed to get you hooked and spending

Welcome to the game. You are now one of the millions of Australians who play video games every day.

Like this game, many are free to play but include repeated prompts to pay.

Gaming is a global business, worth around $US175 billion. That’s more than Hollywood and the music industry combined.

As business booms, so does competition for your attention and money.

We are going to show you how some games are being deliberately designed to extract maximum time and money.

Persuading players to pay for advantages or extra features is a key part of the gaming business model.

You are being offered a certain colour or type of weapon because an algorithm has made a prediction about how you might behave within the game.

Some games can scrape your social media data and work out, for example, which sports team you support, and then offer you items in the team’s colours.

You decide to buy the mid-range weapon. That’s likely because there is a deliberately overly priced weapon to skew your perception of value.

Payments like this, often made using an invented in-game currency, are called microtransactions or in-game purchases.

It is how three-quarters of all gaming revenue is made, about $US117 billion last year.

But these predatory techniques have experts and some gamers pushing back.

In late 2020, Four Corners launched a crowdsourced investigation into video gaming and received more than 3,000 responses.

Many gamers told us how much they enjoyed playing, but others raised concerns about how focused gaming had become on profiting from them.

Games played on mobiles, consoles and computers have become extremely sophisticated, often with artificial intelligence and data collection built into the platform.

Gaming researchers are warning that gamers often don’t know “how much the game is actually playing them”.

“Many of these games are using machine learning, they’re tracking what players are doing using people’s information and within their social network, to make very strong predictions about how people will behave,” said Daniel King, a clinical psychologist from Flinders University.

Microtransactions started appearing in games in the mid-2000s, encouraging people to repeatedly make small purchases to keep them involved.

Of the 20 highest-selling console and computer games in Australia last year, 18 included some type of microtransaction.

The in-game currency trick

Student and mother-of-two Kat McDonald started playing the free-to-play mobile phone strategy game Legend of the Phoenix during the COVID lockdown.

Players take on the role of a young courtesan and complete quests to move up the social hierarchy.

“Once the kids went to sleep, I wanted to find something to play around with,” she said.

“It just felt really good to be at the top of something, because of that time of my life. COVID was a really sad time for a lot of people. It felt nice to actually be succeeding in something.”

The more she spent on Legend of the Phoenix, the further she advanced.

She bought the in-game currency called ‘ingots’ to spend on outfits and to boost her character’s power.

Dr King said in-game currencies were used as a tactic to get players to spend more than they realise.

“The intent behind an in-game currency is to change the psychological value of money that’s been spent on the game,” he told Four Corners.

“Game developers will sometimes use multiple currencies to make it difficult for players to keep track of how much they’re spending.

“[They] disguise or mislead the player about how much money they actually need to spend in the long term until they’re already committed into the game.”

Kat became so immersed in the game she lost track of how much she spent on multiple small purchases.

“I had thought that it was around the $2,500 mark. I wasn’t sure how to work out an itemised account, because on your bank account, it just says Apple.

“I sat down with a notepad and pen and wrote out every single transaction and added it up to $4,000.”

She said the realisation was “mind-blowing”.

“I felt a little bit sick. I felt a bit scared to tell my husband, because we share funds in our house. I felt like that was money that the family could have spent. And I hadn’t even noticed that I’d spent anywhere near that much.”

Kat said she realised she was being manipulated by the game.

“But I was still participating because it was still giving me that dopamine rush,” she said.

“And you’re like: ‘Well, that was money well spent.’ It’s not really.”

In 2019, Australians spent close to $3.2 billion on video gaming. 

Ron Curry, who represents the Australian game development and publishing industry (IGEA), said it was hard to enforce spending warnings within all games.

“With the array of games and publishers and different actors within this market, there’ll always be those who aren’t probably as upfront as they should be,” he said.

Pay to win

You can either wait for your oxygen to refill or you can pay to move ahead in the game instantly.

It’s known as ‘pay to win’.

Video games have evolved from shorter, more contained experiences into much longer game worlds that often encourage people to keep playing for very long periods of time.

This includes characters doing the same tasks over and over again.

It’s called ‘grinding’ — repetitive play required to progress through some games.

In some instances, players are offered the option of paying real money to get through parts of the game more quickly or easily.

Rob Leming has been gaming his entire adult life.

“The pay-to-win model is pretty much as it sounds, that two people can play and they can follow the same set of rules of progression to get better,” he said.

“Or you or me could just spend some money then and there and get all the advantages that come with having progressed.”

He used to be hooked, losing himself for weeks in blockbuster games like World of Warcraft and Assassin’s Creed.

“I would wake up, I would do essentially the basics. Borderline get dressed if I had to, put a bit of food in my belly. Definitely make a coffee, usually a strong one. And sit down and start playing,” he said.

“At that point on, everything in the day revolved around the game.”

He sank deep into grinding as he played for hours on end.

“I spent days jumping around rooftops in some ancient land collecting feathers, and I’m sitting here now and I’m going, ‘Huh? What for?’ Maybe they gave my character a new sword or something, but the game didn’t depend on it. It’s not Assassin’s Creed Fight For Feathers.

“[These games] have a lot of busy work built into them that if you were to actually look back at them you start to wonder, ‘Why does this even exist?'”

Dr King said the more money a player invested, the harder it could be to stop playing.

“The idea of these games is to get people far more hooked into the game, to spend less time away from the game and feel much more invested in the game as they make progress through it,” he said.

“A dodgy car, for example, which you’ve already spent thousands of dollars on, and you justify continuing to spend money on it, because you’ve already spent so much money up to that point that you’re entrapped by the experience.” 

But the industry association describes it as simply “buying into the game” to enhance the experience.

“Whether that’s buying a new skin or whether that’s creating a new house, the vehicle you’re driving,” Mr Curry said.

“In fact, some games are more like a service than a game. You purchase it once, and that game continues to evolve and grow and as you go along.”

Rewards keep you coming back

Daily rewards can be used to keep you playing. If you miss a day, you don’t get the accumulating reward.

The game is trying to make you develop a habit of playing, which makes it more difficult to give the game up. 

Psychiatrist Kim Le treats children and teenagers struggling with their gaming habits. 

“I see a lot of children who are presenting in distress, self-harming, having thought that life isn’t worth living,” he said.

“I have had paediatricians refer children to me who have been soiling themselves … the child will come to my office, I’ll ask them, ‘What are you doing when you are soiling yourself?’ They’ll tell me they are playing a video game and they can’t stop.”

He knows how hard it is to stop, because he’s a gamer himself. 

For the past five years he’s been hooked on Pokémon GO, a mobile game that’s made a reported $US4 billion.

It uses a reward system.

“You love getting the reward when you’ve reached there, but look back and you regret the amount of time that you have spent. You wonder how else I could have spent my time in a more worthwhile way,” he told Four Corners.

“I’ve gone through at least two different 90-day detoxes, so my first-ever self-imposed detox with the help of people, using forums online, journaling my entries … I tried to quit Pokémon GO and within the first week, I failed.

“The game offered me an opportunity, a reward I couldn’t simply refuse. I’d been waiting for this particular reward for a long time and so I relapsed.”

The social meeting place

You can compete online with players around the world and have a live leaderboard track your progress.

You are also encouraged to share your score on social media for extra points.

This is all part of gaming becoming a “social meeting place” where peer pressure can normalise spending.

Nae Jackson has been gaming since she was a child.

For years she dedicated her life to a multiplayer fantasy game called Rift, where players join together in online teams or ‘guilds’ with players from around the world.

“I think the ultimate kill I made with my original guild was a giant octopus and we spent months killing the giant squid, but the sense of achievement when we finally killed it, we didn’t recruit any semi-pro players to help us kill it, we did it ourselves,” she said.

“It was amazing, and just the cheer that went up when we finally got that killed and the little scroll across the bottom, ‘Achievement unlocked’, there’s nothing like it.”

But gaming for so long took a toll.

“During an entire day you can easily do eight hours on a raid day, and there’d be two to three raid days per week.

“Getting the kids ready for school was definitely a problem, I was really tired. I would fall asleep accidentally and once I missed a school pick-up because I was asleep.”

She ended up with stress injuries to her hands.

“I lost a lot of muscle tone when I started gaming a lot. My shoulders would ache, my neck aches, my wrists would actually seize up,” she said.

“I actually had to step out of the raiding team with the guild for a while there because my wrists were so bad.”

On one occasion she organised her whole family life around a 24-hour binge. 

“I had to write all the lists down so that I was organised and I could give it 24 hours straight. I bought energy drinks, dinners were made and prepped,” she said.

In hindsight, she said she was addicted.

“Organising schedules around the game … pretty safe to say that either you are overly, fiercely competitive, which I’m not, or you’re addicted. And you’ve become so immersed in the game world and what’s going on that, that is your world and that’s your priority.”

Kat McDonald was recruited into a guild through the in-game messaging system of Legend of the Phoenix.

“I was definitely identified by the guild, because of my regular gameplay and the fact that I had increased so much power and that was by spending money,” she said.

Her husband Anthony McDonald understands why the guild had such a powerful influence on her.

“There was a bit of a community sense and an obligation almost that she had to maintain and help and support her guild pushing forward. And it was around that time that she spent a lot more time, and I’m assuming a bit more money, doing that,” he said.

Dr King said guilds were a powerful way to keep players online.

“It’s a little like peer pressure. It’s also about friendly competition, a kind of social meeting place where people would spend time outside of work or at home,” he said.

“They want players to experience comfort, to experience a sense of escape from the real world in these experiences, and normalise spending within that same setting.”

Gamers Rob Leming and Kim Le can both relate to this.

“Your personal life starts to exist in the game. You’re meeting friends in-game, you’re making friends in-game,” Rob told Four Corners.

“It’s all about running around in the games, doing adventures and killing creatures and whatever you want to do.”

Dr Le said a key reason he relapsed after trying to detox was his teammates.

“They kept messaging me, telling me to come back and play,” he said.

‘Loot boxes’ similar to gambling

Loot boxes are the most controversial type of microtransaction. Some mimic the look and sound of poker machines.

They’re like a virtual treasure chest that you can buy, with no guarantee of what you might win.

Loot boxes earned the global games industry an estimated $US15 billion last year and the market is projected to keep growing another $US5 billion by 2025.

Psychological scientist James Sauer analyses how video game design affects behaviour and has conducted several studies of loot boxes. 

“We do know that the psychological mechanisms that many loot box systems operate on are very similar to other forms of gambling,” he said.

“A disproportionate amount of the revenue that loot boxes draw from comes from players that score highly in terms of problem gambling symptomology.”

The games industry defends loot boxes, saying they’re no different to a Kinder Surprise.

“I don’t think they’re similar to gambling. With the loot box, you are investing money to get something back. You’ll always get something back,” Mr Curry said.

“Now, whether it’s something you really wanted or it’s something that’s less than what you wanted, it’s still something you can play in your game.”

Dr Sauer rejects this comparison.

“I think when somebody buys a Kinder Surprise, by and large, they know what they’re getting … some chocolate and they’re getting a little plastic toy,” he said.

“In loot boxes … you don’t buy the game for the reward mechanism but the reward mechanism is there. You purchase access to this … and you get a random outcome, that might be very valuable or not at all valuable.”

Greens senator Jordon Steele-John is a keen gamer who has investigated in-game purchases. 

In 2018, Senator Steele-John led a parliamentary inquiry into the potential harm caused by loot boxes.

He is deeply concerned about their use.

“[They enable] particularly young people or people in vulnerable situations to come into contact with the basic mechanisms of gambling, particularly pokies, at very early ages and in a context where they might not be aware that’s what they are coming into contact with.”

The inquiry acknowledged widespread concern that loot boxes could normalise gambling and cause harm. 

But after lobbying from big players in the games industry, the only recommendation was for the federal government to conduct another review into loot boxes. 

“I believe that the major parties rejected stronger recommendations because of the influence upon them by the gambling industry in Australia,” Senator Steele-John said.

“What we heard from the community and from academic experts, people that work in the video game industry, is that at the heart of the loot box exists the same mechanisms that exist at the heart of the poker machine and that those mechanisms are predatory, that they exist to trigger addiction and compulsive continual use.”

Dr Sauer said some countries, including Belgium, had banned loot boxes, while in China, games with loot boxes had to reveal the probability of winning each possible reward. Other countries are focusing on consumer awareness campaigns and consumer information.

 “We need to help gamers understand what’s going on under the hood,” he said.

The IGEA’s Ron Curry said a similar change in Australia was unlikely.

“We have quite an old and difficult-to-change classification regime in Australia. So, to make that change would be quite difficult.”

Laura Gilbert is a passionate player and streamer who is building a following as a gaming influencer.

She’s one of many gamers who is disillusioned with how focused gaming has become on microtransactions and profits.

“I think video game developers can have a plethora of different intentions behind their craft. Whether that is to design a game that will really be wholesome … or there is an element of making a lot of money from the product that they produce,” she said.

“There’s a game that I love playing, and it’s actually directed at quite a young market, like primary school kids, and the amount of small money grabs that they try to make, ‘Get this other colour’, ‘Characterise this’, ‘I want the cool outfit’. How many small transactions do you need to make?”

Video gaming has grown into one of the most lucrative entertainment businesses in the world. 

It’s succeeded through a combination of immense popular appeal and a business model deliberately designed to get people hooked. 

Gamers are now starting to realise how they’ve been played. 

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