anonymous: Or … you can more easily just put the burden on them’s that doing the freebie taking, and leave the “purist” blogs alone

You can’t because regulations require you to prove that you are not guilty.

What happens when your review is more cited than some mainstream magazine? or maybe you consistently put down one company’s products in favor of another? They will go to the FTC and say “this blogger is on the take start investigating”

And you know what happens then? You have to prove you are innocent, they don’t have to prove you are guilty. That’s how regulations work: opposite of criminal law.

I hope you keep receipts for everything that you buy that you review, otherwise you can’t prove you bought it, you probably got it for free.

no, it’s not the guilty who will be punished by regulation, it really never is.

This is nothing but rent seeking by traditional media companies who feel threatened. Notice THEY don’t have to disclose, only individuals.

PatHMV: And make no mistake, these regulations are broad. It’s not just that Joe has to say “I got a free bottle of detergent to review,” when he reviews that detergent. No, the FTC will have the authority to fine Joe if P&G periodically sends him free bottles of detergent or whatever and he ever writes about ANYTHING that P&G produces, even if they didn’t actually give him that particular product for free and didn’t even ask him to write that specific review. How much free stuff before that obligation kicks in? The regulations don’t tell us; it’s up to a “case-by-case determination” by FTC officials.

Think of how many free samples you have received before. Amazon sends free stuff in their boxes some times. I get stuff in the mail occasionally like detergent. Ever get a free sample in a grocery store?

Do coupons and other discounts count? I get coupons in the mail from big companies all the time some of which I am not even aware of becuase i throw them away without looking. The coupons still have value even if I choose not to use them. If I onced used a Burger King Coupon to get an extra free whopper do I have to disclose that If I want to review the burger king down the street on my blog?

Soronel Haetir:
How about hardware review sites like Tom’s Hardware?I believe most of the equipment they test comes free.And if my belief there is correct then the value is far greater than single books.

Do newspaper columns have to do this? I know someone who wrote a technology column for a major metro newspaper you’ve all heard of, and he got free stuff all the time and wrote reviews on it.

(He was pretty fair, sometimes saying that the product’s advertising was a lie. But he didn’t disclose that he got the stuff for free.)

Is this bad thing so bad that it justifies giving the government power to punish people for doing it? Is it so bad that it justifies spending tax money on bureaucrats to enforce the rule? Is that tax money best spent on this purpose, or would it be better spent on some other purpose (the FDA and USDA to help protect the food supply, health care benefits for the poor, etc.)?

THOSE are the key questions to ask. We can probably all agree that disclosure would be better. If we could pass a law that required disclosure and everybody in the world would obey it and their would be no confusion and no enforcement costs and no abuse of power, then great, pass it. But all of those extra consequences in fact exist, and we have limited funds, so we must prioritize and look more closely at the harm sought to be prevented, the likely (or not) efficacy of such regulations, and the total costs involved before deciding whether the regulations are a good or a bad idea.

What is wrong with requiring disclosure is the same thing that is wrong with giving the government lots of other power. It can very easily be abused. I’ve been a prosecutor. I’ve seen at first hand how easy it is for regulators to target the low-hanging fruit, which is generally basically decent, honest people who tripped up over some detailed and hard-to-understand regulation. They’re honest, so they don’t try to hide what they’ve done and they admit it. Meanwhile, the real, flagrant violators are very sneaky, very deceptive, and lawyer up at first questioning, so they wind up continuing. Worse, they often manage to sneak in exceptions to the rules so that their particular practices don’t even violate the law. Certainly they can afford lawyers to litigate for a long time to come.

Want to put some burden on the manufacturers? Ok, I could probably live with that. Limit it to manufactures over a certain significant size, to avoid harassing small businesses, then I’d certainly agree to that. But write regulations that are so broadly written that they can land Joe Blogger in trouble with the federal government? And make no mistake, these regulations are broad. It’s not just that Joe has to say “I got a free bottle of detergent to review,” when he reviews that detergent. No, the FTC will have the authority to fine Joe if P&G periodically sends him free bottles of detergent or whatever and he ever writes about ANYTHING that P&G produces, even if they didn’t actually give him that particular product for free and didn’t even ask him to write that specific review. How much free stuff before that obligation kicks in? The regulations don’t tell us; it’s up to a “case-by-case determination” by FTC officials.

The devil is in the details. The concept sure sounds simple. But regulations don’t embody just the concept. They spell it out, in what almost always turns into confusing detail. It is those details which have great potential to make it overly burdensome to blog or write about anything.

PatHMV: Moreover, even if the P&G saga which you think you remember is something which the government should legitimately stop (and I don’t know that it is), why not tailor the restrictions much more closely, to target only that type of coordinated behavior?

Good question Pat!

First: I’m pretty sure the P&G saga is true, but it may be more recent than 4 years ago.

Second: I suspect that what’s gotten the FTC’s knickers in a twist is the “mommy blogger” phenomenon. (See Mommy bloggers could be held liable.

I strongly suspect that many tech and gadget blogs must be receiving free goods and had been for a long time. This didn’t seem to alarm anyone with a large audience. But when companies formed to make it easy for blogs about hobbies, political rants, and just everyday happenings to make money by reviewing products and endorsing them, a number of vocal, widely read critics of pay-to-blog programs stepped forward. (Some critics were tech bloggers whose blogs are covered with advertising and who posted pre-release reviews of tech products. Go figure.)

The vagueness of the regulations are a huge problem because we really can’t tell whether the FTC is going after the tech bloggers, the mommy bloggers, people who run Amazon ads in the sidebar or what.

If the FTC is going to regulate behavior, it would be much wiser if the rule translated into some very specific activities. Like

a) “If you are required to write a blog post as a condition for receiving a free book, money, travel, yada, yada, then you must disclose this.”
b) “If you receive more than $50 worth of free merchandise a year from company A, you must disclose this fact in any posts about company A and
c) If you receive any monetary compensation on the condition that you publish a blog post describing a product, you must disclose the monetary compensation in the post.

With rules like (a), if publishers want to send 20 free books to 20 bloggers hoping the bloggers will write something, fine. If none of the bloggers write anything, tough luck for the company.

Rule (b) prevents from getting around (a) figuring out which ones will blog, and then eventually having a list of 20 who will blog for gifts.

Rule (c) means if P&G just gives you money to say “I love Pampers!” you have to tell people P&G paid you.

In addition to (a)-(c), the FTC needs to figure out what to do with stray paid links. For example, suppose for some mysterious reason, google will pay a blogger $2 to write a post with the words “dietary supplemants” linking to google. The blogger might write a long post discussing how she hopes to lose weight, somewhere in the post, you’ll read the sentences, “I’ve never taken any dietary supplements. I don’t really trust them. What do you think”?

Is it an endorsement of dietary supplements from the linked entity? (Google absolutely hates this practice by the way. They have been one of the groups campaigning for more regulation of any sort of pay-to-blog practice that involves dropping a link.)

2. The FTC already has the power to forbid unfair methods of competition, as well as other police powers.

3. You seem to assume that what the bloggers turn out can be spotted as a review. That is often not the case. It can be a parathetical remark dropped into a discussion of something else. It can be an offbeat statement that really looks like the sort of thing that a friend would write. In short, the goal of this sort of advertising is to make what is written not seem commercial at all.

4. You are focussing on books. I strongly doubt whether books are much of a concern to the FTC as compared to other products (like whatever P&G is pushing). It seems to be pretty well known that publishers hand out reviewer’s copies. Still, I do not see what is wrong with requiring a disclosure that the book was given to the blogger precisely for the purpose of commenting about it.

I’m not disputing the benefits of disclosure. I think that folks should disclose when they’ve gotten something for free. I oppose only that the government mandate such disclosure by law. Do you have any way to actually address that issue? You’ve spouted off a lot in favor of disclosure, yes, but what are the benefits of having the law mandate disclosure, allowing the FTC broad discretion in deciding what constitutes violations and which violations to pursue? Why is that solution better than educating consumers to look more skeptically at things?

Why is it the responsibility of the government to “fix” this problem, which exists solely because some consumers aren’t quite as cynical as you and anonymous (and I) are about marketers and marketing practices? If a consumer buys a bad book because some reviewer who got a complimentary copy wrote a complimentary review, is that harm so significant that the government needs to step in to punish potentially improper motivations in writing the review? If I’m deciding whether to buy Brand X stereo instead of Brand Y stereo, do I really need the protection of government when I read reviews about which one is best?

There would be absolutely no problem, if all consumers presumed that reviews were bought and paid for unless otherwise specifically stated. Wouldn’t that be a healthy mindset for consumers to adopt, anyway? Don’t you agree that the sneaky marketers will find some other way around the regulations (liquor companies already pay young popular college kids to hang out and drink their product and talk it up in bars), no matter these regulations? A better consumer mind-set would protect against all of those.

Further, nobody has yet addressed the point I made above, which is to say, what happens when all bloggers and reviewers simply post a disclaimer saying: “assume that I was given a free copy of whatever product I’m review on this site, unless I specifically say otherwise.” Does that meet the requirements of the regulations? If so, and most bloggers and other reviewers adopt that as a safe harbor kind of disclosure, is any actual benefit being provided to consumers at that point?

Jesus Christ man, can you not read?
I suspect plenty of bloggers don’t take the freebies and do pay out of pocket, so their words may be more genuine on products they liked or disliked etc., absent any personal financial interest. Skin in the game, and all that.

What part of that are you missing?

Most don’t, some do. Disclose and since it’s not forthcoming voluntarily, prod them along. It’s not all that hard to put the burden on dem’s doing the takings, and leave the independent bloggers/reviewers alone.

Or do YOU assume everybody’s on the take, sucking up them free McFlurry’s and God knows what else in making their “independent” endorsements?

What exactly are you so afraid of here Pat that you have to deliberately mischaracterize the thoughts of others and dishonestly present them? How much money would it take for some to do that, I don’t know. But don’t assume everybody would sell themselve for a freebie whatever-it-is, no matter how pricey some of the gift toys might be.

Independence = something money can’t buy, but too many big players today are selling themselves out cheaply really for trinkets. I want to know who’s in what camp — so sue me.

Troll_dc2… yeah, so? Nobody on here that I’ve seen has said anything to contradict what you just said. I was certainly aware of those tactics. The question to be asked is, so what? Why does that necessitate having the government use its coercive power to make people not do those things? Moreover, even if the P&G saga which you think you remember is something which the government should legitimately stop (and I don’t know that it is), why not tailor the restrictions much more closely, to target only that type of coordinated behavior?

What is your objection to requiring that someone who is pushing a product disclose that he was compensated for endorsing it? I don’t know about you, but I regard this marketing method as smarmy, even dishonest. If you don’t want the government to alert readers that the endorsement is not on the up-and-up, how would you deal with the problem? You may think that there is no problem at all, but I do not agree. The remedy is a simple and non-obtrusive one.

Troll_dc2… yeah, so? Nobody on here that I’ve seen has said anything to contradict what you just said. I was certainly aware of those tactics. The question to be asked is, so what? Why does that necessitate having the government use its coercive power to make people not do those things? Moreover, even if the P&G saga which you think you remember is something which the government should legitimately stop (and I don’t know that it is), why not tailor the restrictions much more closely, to target only that type of coordinated behavior?

Because I suspect plenty of bloggers don’t take the freebies and do pay out of pocket, so their words may be more genuine on products they liked or disliked etc., absent any personal financial interest. Skin in the game, and all that.

What part are you still having trouble with? The “teeth” in the call to disclose? Ethically, they should but right now they’re not.

The biggie players don’t want you to know what they’re getting, and they’re hiding behind the Free McFlurry coupon and galley proofs scare to the little bloggers. Nope.

Like I said, I can’t wait to see them either turn off the spigots, or just reveal who is taking care of them via the freebie goodie giftbags. Don’t care if its celebrities, politicians, coppers, or bloggers on the teat. Just dislose, so we can separate the independent ones from the kept reviewers.

I’m sure plenty will be embarrassed at full disclosure and want to wiggle under the radar. It should be fun watching the wiggling at work too; the lengths some people will go to keep their comped goodies secret. Heh.

Again, the issue is not disclosure. The issue is mandated by the government under penalty of law disclosure.

If you want liberty, you are independent. You can’t assume independence, when your media is tethered to the corporate feedbags, collecting gifts and prizes for every complimentary “review”.

New media, old media — who’s paying for your lunch? For the roof over your head? For your kids’ clothes and games? For the toys and prizes you get in the mail?

I’ve got a feeling some very naive people are going to be shocked — shocked I tell ya — at just how non-independent and on the take some of these “reviewers” are.

How much money can you honestly make sitting home in pajamas, relying on the ads off the sidebar? It’s the perks baby, and the FTC just wants openness, to determine who — if anyone — is greasing the skids.

Trust me — all this talk about galley proofs and McDonald coupons is just a diversion. Our new media is just as corruptable, just as potentially open to making a fast buck, as anyone.

But I suspect we’ll all be learning more soon, once the rules kick in, and we get to see exactly how independent our new writers are, and who’s helping take care of them. Even Barack Obama needed a Tony Rezko, and surely before that disclosure everyone would have thought his top salary might have kept him honest.

Heck, even cops have to pay for their donuts nowadays! Suck it up, and disclose.

I ask because my understanding is that at the time of its formation, the FTC did not have power to prosecute, but to refer cases for prosecution. If my understanding is correct, or if it is still correct after all these years, maybe what the FTC can do is more attenuated than the comments and Mr. Adler’s post suggests.

Another point/question: I agree that the guidelines are disturbing, at least as they are described here in this post. But does the whole issue raise the question of what counts as “commercial speech,” as opposed to “political speech”? As I understand it, “commercial speech” is less protected than is “political speech.” Maybe any prosecution or fine would hinge, in part, on whether the violator is found to have engaged in “commercial speech.” Perhaps this is also what Tatil, above, was getting at in one of his comments.

I’m not trying to defend the guidelines, which, again, I haven’t read. As a blogger myself, I’m disinclined to like any restrictions on what I write, even if hardly anybody reads it.

The FTC is regulating any service or good.

What about a coupon you get in a paper for a free “new ultra deluxe” burger at the local McKingdy’s.

If you then blog about how you like the new sandwich offering you would have to disclose that you received a coupon.

I’m sure more people will have access to coupon’s for restaurants or other local services then access to galley proofs. Not that I would object to receiving free galley proofs.

I had thought Pat’s position was nearly universal.

Mr. X is a baseball blogger. His local team sends him some free tickets. – decent seats that normally sell for $15-20 a ticket, but the game wasn’t going to sell out anyway. Is he legally required to disclose the free tickets if he blogs about that game? How about if he blogs about the team without specific reference to that game?

Now let’s suppose that Mr. X got the free tickets as a door prize at a team-sponsored event open to the public. Then what?

Now let’s suppose that Mr. X got the free tickets in a random drawing sponsored by the radio station that carries the team’s games. Then what?

Now let’s suppose that Mr. X got the free tickets in a contest of skill (e.g., first caller with the right trivia answer) sponsored by the radio station that carries the team’s games. Then what?

Meanwhile, Ms. Y is a music blogger. She is invited by a local station to a private performance in-studio at that station by an up-and-coming recording artist. The artist and her representatives have no control over who is invited. If Ms. Y blogs about the artist, but doesn’t discuss the station, is she required to disclose the invitation? What about if she discusses the station as well?

Now let’s suppose that Ms. Y won the tickets to that performance via participation in the station’s listener club (i.e., redeem points, accumulated by listening, for prizes). What, if anything, is she required to disclose if she blogs about the performance?

Now let’s suppose that Ms. Y won the tickets to that performance by being the right number caller to the station when some song was played. What, if anything, is she required to disclose if she blogs about the performance?

Mr. Z is another music blogger. He is given concert tickets by a radio station to a concert by a well-known band. The station was given those (and more) tickets by the concert promoter. The promoter has no control over who the station gives the tickets to. The station plays that band’s songs quite often. If Mr. Z blogs about the concert, is he required to disclose the invitation?

Now suppose that Mr. Z won the tickets to that performance via participation in the station’s listener club (i.e., redeem points, accumulated by listening, for prizes). What, if anything, is he required to disclose if he blogs about the concert?

Now let’s suppose that Mr. Z won the tickets to that performance by being the right number caller to the station when some song was played. What, if anything, is he required to disclose if he blogs about the concert?

Nick

MLS: It usually helps to read regs before waxing poetic about them.

Thanks for the FTC guide.

From Example #7 for 16 CRF § 255.5, Disclosure of material connections, it appears that the FTC takes a much broader view of what constitutes a “material connection” to the product’s manufacturer than the FCC takes in its sponsorship identification and disclosure requirements in 47 CFR § 73.1212.

In the FTC’s example:

…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.

Yet, for broadcast sponsorship identification disclosures, 47 CFR § 73.1212(a)(2) provides an exception to the disclosure requirement:

(2) By whom or on whose behalf such consideration was supplied: Provided, however, That ‘‘service or other valuable consideration’’ shall not include any service or property furnished either without or at a nominal charge for use on, or in connection with, a broadcast unless it is so furnished in consideration for an identification of any person, product, service, trademark, or brand name beyond an identification reasonably related to the use of such service or property on the broadcast.

The blogger in the FTC example received the video game for use in, or connection with, publication of a review of same.

A broadcaster who receives a free recording, plays it and comments on it, is not required to disclose that he received the recording free of charge, because it was given “for use on, or in connection with a broadcast” and not “in consideration for an identification … beyond an identification reasonably related to the use of such service or property on the broadcast.”.

I think any distinction between the two is without any real difference.

So, unless the FTC begins prosecuting broadcasters of reviews and comments, where the subject material of the review (book, music, show, etc.) was provided in conformance with 47 CFR § 73.1212, I think they’ll face major political and legal resistance for prosecuting bloggers for essentially the same acts (but not through an FCC regulated broadcast facility).

I’m taking the common sense view, not to be confused with a legal view, so I could be very wrong. It just makes no sense, and would be profoundly corrosive to civil liberties, to grant commercial broadcasters greater rights to express opinions without commercial sponsorship requirements than are granted to ordinary citizens.

Or … you can more easily just put the burden on them’s that doing the freebie taking, and leave the “purist” blogs alone. Like I said above, those that don’t want to disclose under the new rules, can easily avoid that. I suspect plenty of the biggies are so attached to the freebie teat at this point though, that being independent might be a big hit to the wallet.

I’d much rather the default be lack of bias, writing genuinely, and let those doing otherwise own up to their sources. Particularly because it’s probably only a few of the bigger blogs they are concerned with.

I’m backing the new regs for the entertainment value actually. Can’t wait to see how much of the BIG STUFF — not books or trinkets but significant things of value — these guys are taking for free, and from whom, and not letting on. Kind of like the blogging equivalent of a kept woman. Heh.

I don’t see anything wrong with this. We can trust Obama and the Democrats.

Not whether such a law could ever be enacted, given the various complicating interests which would array against it. Just whether it could be a good idea.

Perhaps because it will be embarrassing for some of the biggie bloggers to disclose exactly how much freebie swag they are taking? That, and maybe some of those IRS income regulations someone mentioned above.

so why not just assume that all the reviewers have been compensated, unless they specifically say otherwise?

Because I suspect plenty of bloggers don’t take the freebies and do pay out of pocket, so their words may be more genuine on products they liked or disliked etc., absent any personal financial interest. Skin in the game, and all that.

It’s not a matter of what the burden is (I think that bloggers should do it as a matter of good practice and ethics), it’s a matter of whether the government should MANDATE it, and impose fines as a consequence of failing to do so.

As a consumer, I’d like to know whether the reviewer gets free copies or some other benefits, so that I can decide how much I can really trust the reviewer’s opinion.

Now, could you tell me why it is such a big burden on reviewers to say whether they have received any free samples or other financial inducements?

For example, if I’m a blogging doctor and say that I found “X” nutritional product like protein power to be delicious, and then go on to discuss how it’s helped my body in a special way, less savvy reader/CONSUMERS are banking on that.

Ditto all these lawyer bloggers commenting on political/legal products, etc. (the etc. being the all-encompassing Big Pricetag items that I suspect the FTC is targeting)

Is that benefit sufficient to justify allowing the government to investigate you, subpoena your bank records, and take money away from you?

That’s something that each blogger is going to have to decide for himself. There really is an easy answer if you don’t want to play by the new rules and disclose who’s providing you what: open your wallet, pay instead, and decline the freebies. I know, I know — I can here the whining now…