6 game operators to end controversial sales system

Six online game operators have announced they will stop using the "kompu gacha" sales method in their games by the end of this month due to criticism that it imposes extremely high charges on players.

The announcement Wednesday came after the Consumer Affairs Agency pointed out this month that the kompu gacha (complete gacha) sales method violate the law against unjustifiable premiums and misleading representation.

The kompu gacha system, which is featured in social networking site-type games, entices players to buy a certain number of required virtual items so they can be exchanged for a rare virtual item.

However, while players are required to pay hundreds of yen to buy one item, the item they receive is chosen at random.

The six companies and others in the online gaming industry will create guidelines on illegal charging methods within the month after discussing the issue with the agency.

The six firms are DeNA Co., which operates popular gaming site Mobage, Gree Inc., NHN Japan Corp., CyberAgent Inc., Dwango Co. and Mixi Inc. The companies have established a liaison council called the Social Game Platform Renraku Kyogikai.

KLab Inc., a software developer that provides mobile online games to these firms, also announced it would stop using the method in its 11 online games.

On the Tokyo Stock Exchange, major SNS game operators DeNA and Gree have lost ground since the problem came to light on Saturday.

On Monday, shares of both companies reached the maximum loss allowed by the TSE for one trading day, and their share prices continued to fall in the following days.

On Wednesday, Gree shares were down about 30 per cent from their May 2 price, while DeNA shares had fallen by about 20 per cent.

Over the past week, the total market value loss for the two companies has reached about 230 billion yen (S$3.5 billion).

Despite the huge loss, the companies are confident about their business. A Gree spokesperson said, "The problem won't have a serious influence on our core business."

A DeNA spokesperson said, "Profits will not fall below that of one year ago [before the firm introduced the kompu gacha method]."

Meanwhile, the agency is questioning relevant companies regarding the issue, and will announce its opinion after its investigations have been completed.

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