FTC: Bloggers must disclose payments, freebies

In the first update to its guidelines for advertisers since 1980, the U.S. Federal Trade Commission (FTC) have released new guidelines that require bloggers to disclose any payments or free gifts they might have received when doing a review or endorsement of a product or service.

According to a report on Computerworld, the FTC will make decisions on a "case-by-case" basis, though bloggers who make an endorsement must "disclose the material connections they share with the seller of the product or service." The new rule goes into effect on December 1.

What is not so clear is how the ruling will be enforced, if at all. What makes the matter more complex though, would be its far-ranging repercussion in the blogosphere. For example, consider the hypothetical situation in which a blogger has at one time received a freebie from a large vendor. Does that mean that a blogger will now have to acknowledge the freebie on every "endorsement" henceforth, and on every product made by the vendor?

It is also unclear what constitutes an "endorsement"--this might range from a blog entry, to a Facebook comment or even a Tweet. Too bad if you genuinely like another product made by the same company, and want to recommend your friend to use it. This starts to look even more awkward when you consider the USB flash drives and other small gifts that are often given out as part of press kits at trade shows or conferences. Do those count as freebies too?

In fact, Caroline McCarthy of CNET News suggests that even signing up as a Facebook fan of a hotel, for example, could mean that the hotel name would show up beside the name to the person's friend. This is theoretically an infringement, if no disclosures are made. Is a disclosure possible in the previous example? What about for a 140-character tweet?

Richard Cleland, associate director for the FTC's advertising division is uncompromising about the guidelines, "You may have to say a little bit of something else, but if you can't make the disclosure, you can't make the ad."

For more on this story:
- check out this article at CNET News
- check out this article at Computerworld

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