FTC says bloggers can be fined for endorsements

The Federal Trade Commission (FTC) says bloggers can now be fined for undisclosed endorsements. What does this mean? It means if you are a gaming review site and you get a free copy of the next Halo game to review (and you don’t disclose that you got it for free to review) – you can be fined up to $11,000 (per blog post). So what if you get a free software download or free premium access to a web site and review it (and don’t disclose it) – can you get fined for that too? Celebrities that endorse products without disclosure can be fined as well.

What this video from a Boston news channel that explains this in greater depth, and then we’ll come back and talk about this some more…

Now then, the Internet has made it much easier for people to lie, cheat, and steal. Years ago, when everybody had the local newspaper delivered to their doorstep the way you found out about products was in the ads inside the paper. Particularly on Sunday, I can remember years ago as a kid the greatest thing about the newspaper was the Sunday funnies, and all the advertisements from all the stores with the following week’s sales. Whether it was video games, toys, clothes, or electronics (in our house), this was how we knew about all the things that were on sale.

Some retail stores would put loss leaders on sale (items where they break even and make no money), just to get you through the door. Other stores might do the old “bait and switch” – and old time scam where you advertise one thing, but when people get to the store you replace it with something else. Maybe the original item never existed, maybe the store only had 5 of them to sell (but never disclosed that in the ad). Over the years, this has lead to many “truth in advertising” laws being put on the books. I don’t know how much good it’s done, since I still see infomercials for losing 10 lbs in a week with “results not typical” in such tiny print at the screen bottom I can’t even make it out.

The Internet has matured to the point now where, for the first time since 1980, the American federal government has felt the need to update the laws of “endorsement and disclosure” to include online bloggers. This is to keep the “bait and switch” from happenning online in a different way. It’s to keep a company from giving 100 bloggers free access to their product in exchange for something. For a coupon, a free account, actual money, free software, even free products mailed to their house. It’s to keep Sony from sending 50 top profile bloggers a free next-generation Playstation 4 in exchange for a favorable review. It’s to keep the record companies from paying 100 twitterers from tweeting how much they love the new Lady Gaga album. It’s also to keep bloggers from giving a favorable review to the latest “keyword crap” software just because they got a free copy and affiliate commissions from any sales made from the blog post.

This is all very noble (and necessary), but I’m sorry – this are no “Internet Police”. The government can barely find all the sex offenders and pervs online that need to be locked up (we’ve all seen Dateline: To Catch a Predator). The FTC admins they can’t police 100 million blogs, they can’t even police 1,000 blogs. I have to imagine that they will only prosecute the most egregious cases. Like my Grandma always used to say “they don’t make signs unless there was a problem”. Well, they didn’t update the rules for endorsements because there were no problems online. The updated it because there are MAJOR problems online, and they intend to prosecute and fine some of the biggest cases that they find.

So – if you’re a blogger does this make you rethink the ways that you do things? It should. Like you saw in the video, some people still believe that blogging is a “conversation” – and it’s true, in it’s purest form – it is. But when that conversation can be hijacked by media or advertisers than it’s unfair. It’s unfair for the public to think that people actually like or endorse something because 100 bloggers (that got it for free) said it was good. The problem is, I can get free stuff, disclose that I got it for free, and STILL completely fabricate a positive review because I got it for free, and I want to get more stuff for free. How do you police that?

Items to read:

FTC Official Guidelines for bloggers

NYTimes.com: Bloggers must disclose gifts

Washington Post: FTC Sets Endorsement Rules for Blogs

FTC to Bloggers: Disclose Freebies or face $11,000 fine