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Gree, DeNA abandoning dubious virtual goods practice

Gree, DeNA abandoning dubious virtual goods practice

May 9, 2012 | By Eric Caoili

Facing possible regulations from the government, Japan's biggest mobile social game network operators have agreed to phase out a controversial method of selling random virtual goods.

Japan's mobile social game networks make most of their money from virtual goods, and one of the most popular methods for selling them is "Kompu Gacha": players purchase random virtual goods, and receive a prize if they manage to collect a complete set of certain items.

Some felt this practice preyed on players' gambling spirit, though, and the country's Consumer Affairs Agency began investigating "Kompu Gacha" complaints from consumers. Reports emerged earlier this week that the agency had ruled the practice illegal and would soon restrict it.

One of the largest network operators, Gree, responded on Tuesday by announcing initiatives to promote "proper use of social games." And now the company says it will immediately halt "Kompu Gacha" features in its games, and will suspend them in games from other developers on its service by the end of the month.

Another platform operator, DeNA (Mobage), revealed on Wednesday morning, that it's also phasing out "Kompu Gacha" tactics, according to Businessweek. Local developers of mobile social games like KLab have said they're abandoning the feature, too.

Macquarie Securities analyst David Gibson predicts that a ban on "Kompu Gacha" could reduce Gree's profits by as much as 18 percent and DeNA's by 6 percent. CAA as not yet said whether it will regulate the sale of these random virtual goods sales, but it's expected to make an announcement soon.

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