Marketplace has a new podcast for kids, "Million Bazillion!" EPISODE OUT NOW
Marketplace Scratch Pad

Blogger freebies

Scott Jagow Oct 5, 2009

I’m having a hard time understanding this one. The Federal Trade Commission has issued new guidelines that require bloggers to disclose when they receive cash or free stuff from companies and then write about their products.

Beginning December 1, bloggers who are “endorsers” could be fined up to $11,000 per post. From the FTC press release:

The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service.

From PC Magazine:

The FTC provided the example of a college student with a well-known gaming blog who receives a free copy of the latest game for review, and posts a positive review. The student would have to tell readers that he received a free copy of the game, and the manufacturer should tell him that he has to disclose their relationship.

The commission also pointed to a message board that discusses new music download technology. If an employee of a leading playback company frequents the board and posts positive reviews, that employee needs to disclose their relationship with the company, the FTC said.

So you too, blog commenter, better be careful.

There’s no doubt it’s a jungle out there on the wild wild web. Sometimes, it’s hard to tell where opinions are coming from. But why bloggers? “Journalists” and public officials are under no such restraint. Why don’t members of Congress have to say out loud when they are voting no on a credit card bill that they received $100,000 from the bank lobby just this week? And there is no government authority that makes these rules for journalists giving reviews in magazines or newspapers. From Spiers:

If this were enforced with actual journalists, I know a lot of people who’d be out of a job and/or deeply in debt to the FTC. At lifestyle magazines in particular, freebies are often the norm, not the exception. (I don’t think that’s the way it should be, but that’s the way it is.) But you’ll never see a little asterisk next to a ringing endorsement of this season’s Galliano show that the company happens to outfit the editor-in-chief at zero cost.

Meanwhile, Mashable thinks this is a good move:

Certainly, it seems like this is an update that’s time has come. While most well-run social media programs already include appropriate disclosure, there’s still no shortage of unscrupulous marketers using deceptive practices to sell products. Now, with the threat of serious fines, those who look to push the boundaries of ethical blogging will be doing so at their own risk.

Of course bloggers should reveal when they’ve received product or payment. But ruin your credibility at your own risk. I don’t see how this is enforceable or necessary as public policy.

More tonight on Marketplace. In the meantime… your opinion?

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.