FTC cleans up Blogging Ethics: Disclosure rules in effect

If you have been following the issue, the Federal Trade Commission (FTC) reported in October of 2009 that it would create regulations requiring disclosure of any payment (monetary or goods) made to a blogger.  The move is designed to address the issue of companies “buying” bloggers to generate positive word-of-mouth.  Bloggers must now disclose whenever they receive compensation from a company then write about that company or its products.  Here is a relevant section from the October 2009 announcement:

“The revised Guides also add new examples to illustrate the long standing principle that “material connections” (sometimes payments or free products) between advertisers and endorsers – connections that consumers would not expect – must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other “word-of-mouth” marketers.”  http://www.ftc.gov/opa/2009/10/endortest.shtm  To see the full document developed by the FTC go to http://www2.ftc.gov/os/fedreg/2009/october/091015guidesconcerningtestimonials.pdf  Keep in mind the documents discusses other changes as well related to celebrity endorsements, use of research, and testimonials in marketing and advertising messages.

Not all bloggers were happy about this new regulation and complained during testimony before the FCC and on their blog sites.  If you search blogs and disclosure you will find examples.  Bloggers are worried about the effect of the regulations and that the FTC can punish them for non-compliance.  People were worried on what actually constituted endorsement.  Others debated the need to disclose.  Many bloggers already disclose while some encourage companies to pay them but remain silent on the issue of disclosing that payment to their readers.

So where is the ethical concern?  The concern is about full disclosure including potential biasing factors.  The FTC believes, and PR ethics would agree, that people should know potential biases of a source when they are evaluating a message.  When bloggers do not disclose “payments,” readers are not given an important source of information about a potential bias.  We can call it honesty, full disclosure, or even transparency.  The point is that readers should know if a “payment” occurred so they can more effectively evaluate the message. 

Let us consider real example.  When Microsoft launched Vista in 2007, it reached out to bloggers.  Around 90 influential bloggers were given Vista.  Vista was given to them by loading it on a top-end Acer laptop valued around  $2,000.  The bloggers were free to keep the computer if they choose to.  The bloggers were also free to disclose or not disclose the gift with Vista.  A number of bloggers, but not all, did disclose the arrangement.  However, online critics called it “payola” or “bribes.”  http://www.pcworld.idg.com.au/article/170743/microsoft_woos_bloggers_free_computers_vista

Perhaps a better term is “blog-ola.”  Blog-ola was used in 2009 discussions at the Blog-Her conference in Chicago.  The Blog-Her conference included a focus on the “mommy bloggers,” and influential group, just ask people associated with Motrin at McNeal. (http://www.usatoday.com/tech/products/2008-11-18-motrin-ads-twitter_N.htm)   The discussions at the conference included sponsorship of blogs and the need to be open about any sponsorship arrangements.  The FTC is shifting that debate because disclosure is a requirement.  People can now debate the merits of the regulation. 

Questions to Consider

  1.  How might a company benefit by requiring bloggers to disclose “payments” as part of the arrangement for providing the “payments?”
  2. Do you believe failure to disclose payment is unethical?  Why of why not?
  3. What justification can there be for opposing the FTC requirements?
  4. Should bloggers simply refuse any “payments?”  Why or why not?
  5. Journalists cannot accept gifts so what does paying bloggers mean for the term “citizen journalist?”
  6. Should we expect bloggers to uphold standards similar to journalists?  Why or why not?
  7. What provisions would you put in a blogger relations statement if the organization where you work request one to be written?
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