Tobold's Blog
Monday, October 05, 2009
Hiding freebies is now illegal

A reader alerted me to the news on a ruling by the Federal Trade Commission saying that "bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service". In other words, bloggers getting freebies from game companies, such as "review copies" of games, free subscriptions, or other swag, are now legally required to mention this before reviewing games from those companies. Which, fortunately for me, is already established policy on this blog since I got my first freebie.

In the past not everybody agreed with my full disclosure policy. And I would say that at that point it was just a minor ethical question. But now it becomes a legal question. I am not a lawyer, and I haven't got a clue what exactly would happen if a blogger praised a game in return for undisclosed freebies. But theoretically that could now get you into trouble with the law. I'd strongly recommend full disclosure, even if you don't like the ruling.

I wonder how many bloggers actually do get freebies. Do you think we are about to find out?

Addendum: I really must quote this example from the new rulings:
Example 7: A college student who has earned a reputation as a video game expert maintains a personal weblog or “blog” where he posts entries about his gaming experiences. Readers of his blog frequently seek his opinions about video game hardware and software. As it has done in the past, the manufacturer of a newly released video game system sends the student a free copy of the system and asks him to write about it on his blog. He tests the new gaming system and writes a favorable review. Because his review is disseminated via a form of consumergenerated media in which his relationship to the advertiser is not inherently obvious, readers are unlikely to know that he has received the video game system free of charge in exchange for his review of the product, and given the value of the video game system, this fact likely would materially affect the credibility they attach to his endorsement. Accordingly, the blogger should clearly and conspicuously disclose that he received the gaming system free of charge. The manufacturer should advise him at the time it provides the gaming system that this connection should be disclosed, and it should have procedures in place to try to monitor his postings for compliance.
I don't think the fact that I'm not a college student any more exempts me from that. :)
That reader was me. =p But yeah like I told you earlier, I thinks it's a step in the right direction. It helps to protect both the consumer and the reviewer and hopefully reviewers take the ruling to heart and actually practice full disclosure.
I'd like to add onto my post that this will hopefully quiet all the "reviwer X was paid off by publisher Y!" nonsense that people always throw out there.
Of course as this is a FTC ruling anyone (bloggers, companies, etc) outside the USA is free (that's a PUN folks) to ignore it and the FTC can't do a damn thing about.

But its still an interesting development.
That reader was me.

Which is a good opportunity to mention another policy of mine: If a reader sends me news I didn't know before, and I blog about it, I will always mention that the news bit came from a reader. But if the mail isn't signed, or signed with something that looks like a real name, I will not mention that name unless specifically told to. Bigeyez' mail wasn't signed, so I just said "a reader", and didn't use the name from his e-mail account or something.
I'm amazed it's got law around it, but perhaps it really is a recognition of how immense the entertainment industry is and how diverse its "media" is across youth.

I think if an american company is hosting your blog it still applies even if you do not live in the USA.

I think this will only help the quality of blogs. At the very least they will remain unchanged.
I find it interesting that they are requiring the game companies to notify bloggers about this, and them monitor them for compliance too. I wonder if that means we will see less freebies going out to bloggers / consumer generated content creators.
It makes me sad when we end up with often unenforceable laws in place of social standards.

This does beg the question of:

Where does the line get drawn between bloggers, and those who call themselves journalists?

If someone, say a blogger, receives a free copy of a game in exchange for a promised review, isnt that blogger now providing an opinion piece based on a request from the game developer, and in turn they do research of said game in order to provide the facts for his/her opinion piece....aka Journalism?

People can bash a reviewer like in the case of the Eurogamer debacle( where the reviewer was not a trained staff member...[read: a Journalist]), yet bloggers, who do the same thing, are somehow insulated because of a lack of credentials or pedigree?

I read reviews on sites like Eurogamer and others all the time, as well as the reviews you write on occasion...and to be honest, I cannot tell a difference between the two.

I just wonder what the FTC plans on doing in regards to enforcement of this? The FTC is not an organization that was setup to track what private citizens do in their daily lives, and afaik there is no supporting law doctrine that would allow for the FTC to issue punitive measures against private citizens for non-compliance.

Maybe bloggers and gaming journalists would do well to incorporate the "Consumer Reports" method of reviewing games: They actually buy them with their own money and review them with a sense that the greater good of gamers everywhere is being served without the least hint of bias or impropriety.
The only thing that really tee's me off about the FTC's ruling is that their examples on this subject send a bad implication. All of them having to do with such freebies assume the blogger is a college student, or independent of some kind. While I'd like to think this was not the FTC's intention, it does kind of imply that professional organizations (where this kind of regulation might actually be needed more) are off the hook.

Just gotta be aware of how you phrase things sometimes. Because in interweb-land, it's how someone read your words, not how you meant them, that matters.
I have to wonder what sort of enforcement plan the FTC has on this. Probably complaint based action only.

So far I have not had to worry about having my views tainted by free materials... except for that wonderful shirt from those great guys at the Warp Drive Active podcast!
1st amendment. Thank you. Have a nice day. And since when did "Guidelines" have any legislative force? This is in the same category as file sharing; sure, it might be illegal, but getting caught is like winning the reverse lottery. And if you did get caught, call the ACLU. They'll handle this shit quite nicely.

Aren't you in Europe Tobold? The FTC can sit and spin for all you care.
Well, I had said when I was given my first freebie--opera tickets--I would hold by what I learned from Tobold and Syp and let my readers know. So let them know I did. Not because I had to, but because it was *right.*

So thanks, Tobold, for keeping me one step ahead of the game. ;)
1st amendment. Thank you. Have a nice day.

Doesn't help you here. And besides, both the first and the second amendment are widely misunderstood, and don't guarantee people quite as many rights as those people like to think. Shouting "Fire!" in a crowded theatre when there is none is still illegal, first amendment or not. Not disclosing your income to the IRS is still illegal, first amendment or not.

This is in the same category as file sharing; sure, it might be illegal, but getting caught is like winning the reverse lottery.

That is certainly right, if you belong to the category of people who only follow laws based on how likely they are to be caught. I'm what in D&D was described as "lawful alignment", and I don't fileshare.

Aren't you in Europe Tobold? The FTC can sit and spin for all you care.

Not sure about that, because my blog is hosted by an American company. So the FTC could close the blog down. And if condemned in an American court, I would be unable to ever enter the US again.
"I think if an american company is hosting your blog it still applies even if you do not live in the USA."

The FTC could ask an American hosting company to take blog down but I don't think they could enforce any punishment against a blogger living in a foreign jurisdiction.

It also begs the question of what is an "American company?" Google which owns Blogger has offices all over the world.

I think it's very tricky to go after a foreign national committing a "crime" which is in fact legal in his own country and uses a multinational corporation's facilities.

Of course Google might take a site down simply because it doesn't want to antagonise the FTC even if legally the FTC hasn't got a leg to stand on.

But I'd be astonished if a non-American company cared about the FTC at all. Do we in the West care that under Iranian law women should have their heads covered when in public?
The big surprise for me here is that we have a law in place BEFORE something major happened that requires the law. Usually it's the other way around.

As for the law itself, I have no issues with it. I tend to pass on blogs with advertising because I always question if the content is written because the writer believes it, or is it written to drive traffic and earn a few bucks off those ads. This is somewhat similar, but harder for the reader to see. Is blog X saying nice things about some game because they really like it, or are they doing it so the company will get them into their next game's beta? Opinions vary enough as it is without having 'bought' authors thrown into the mix.
Note that the Kotaku piece on this matter asserts that the ruling doesn't constitute enforceable law, so it's questionable as to whether or not any changes will even occur as a result of the ruling.
Just because something is good practice, doesn't mean you should be compelled.

Remember the law gives a lot of latitude to prosecutors to judge on a case by case basis. So there is little guideline. what is a blog? what is endorsing? that is all pretty maleable. If a kids posts something on a social networking site can this be used against him? If he commits some other crime and a prosecutor wants to nail him for everything he can, you can bet it WILL happen, not that it might.

You think it will be enough to disclose each time you get something for free? no it will not, because some large company will notice you give favoriable reviews to competitors and not to their games, and they will press charges. Then you have to prove you did not receive anything from that company. Not only the game, but anything that could be an influence. How can you prove a negative? you cannot.

This law means not that you will have to disclose, it means you will have to keep receipts for every single game you buy if you want to talk about it. Because a prosecutor might demand you prove you were not influenced.

That is the problem with regulations, they are not like criminal law where you are presumed innocent. Regulations require you to prove you are not guilty. Also, if regulations are made into criminal law it's even worse.

I would bet money a company like Sony would use such a law to try to silence someone who consistently produces negative reviews of their products and positive reviews of competitors. If you can't prove you received nothing from the competitor well sucks to be you then.
>The big surprise for me here is that we have a law in place BEFORE something major happened that requires the law. Usually it's the other way around.

Well handing out freebies in marketing is pretty standard practice thats been going on for some time and games are only tiny slice. Sporting apparel/equipment and electronics including game consoles, players, tv's are all pretty routinely handed out.
Flying reviewers in for product demonstrations is also common, which would have to be disclosed under the guidelines.

The morale sidestep in the past is to review product x while keeping product y. Ie. I can highly recommend these golf balls (especially since I received a free set of clubs to hit them with).

The ruling is just making is just making the process more transparent and its good for the consumer.
And, of course, the tacit assumption is that professional media always discloses everything relevant.

Targeting bloggers for this seems a shaky step to me; a stab a state control over blogging, if ever so small.
As soon as every other journalist complies with this rule, I would too. But from my knowledge, major companies like PC mag never reveal that they got free stuff. Same goes for other industries. Also same goes for the record industry actually, where they pay DJs to play their songs. That happens to be illegal but not enforced.

I wouldn't worry about this, but it's the ethical thing to do.
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