Federal Trade Commission (FTC) to regulate blogging

[hwang]

According to online sources:

The Federal Trade Commission will try to regulate blogging for the first time, requiring writers on the Web to clearly disclose any freebies or payments they get from companies for reviewing their products.

The FTC said Monday its commissioners voted 4-0 to approve the final Web guidelines, which had been expected. Violating the rules, which take effect Dec. 1, could bring fines up to $11,000 per violation. Bloggers or advertisers also could face injunctions and be ordered to reimburse consumers for financial losses stemming from inappropriate product reviews.

The commission stopped short of specifying how bloggers must disclose conflicts of interest. Rich Cleland, assistant director of the FTC's advertising practices division, said the disclosure must be "clear and conspicuous," no matter what form it will take.

Bloggers have long praised or panned products and services online. But what some consumers might not know is that many companies pay reviewers for their write-ups or give them free products such as toys or computers or trips to Disneyland. In contrast, at traditional journalism outlets, products borrowed for reviews generally have to be returned.

Before the FTC gave notice last November it was going to regulate such endorsements, blogs varied in the level of disclosures about these potential conflicts of interest.

The FTC's proposal made many bloggers anxious. They said the scrutiny would make them nervous about posting even innocent comments.

To placate such fears, Cleland said the FTC will more likely go after an advertiser instead of a blogger for violations. The exception would be a blogger who runs a "substantial" operation that violates FTC rules and already received a warning, he said.

Existing FTC rules already banned deceptive and unfair business practices. The final guidelines aim to clarify the law for the vast world of blogging. Not since 1980 had the commission revised its guidelines on endorsements and testimonials.

Cleland said a blogger who receives a freebie without the advertiser knowing would not violate FTC guidelines. For example, someone who gets a free bag of dog food as part of a promotion from a pet shop wouldn't violate FTC guidelines if he writes about the product on his blog.

Blogger Linsey Krolik said she's always disclosed any freebies she's received on products she writes about, but has stepped up her efforts since last fall. She said she adds a notice at the end of a post, "very clear in italics or bold or something — this is the deal. It's not kind of buried."

How does this affect you?

[life31]

Hmm in that case a lot of blogs reviewing products would be dealt seriously. No doupt that there is no control over that. And most of the times some companies collect the credic card info or some details for some free stuff or one month free subscriptions and then from the second month the consumer is being charged unknowingly.

[hwang]

I think it's more towards tax related issue whereby gifts were not counted as taxable I guess. However, not sure...

[A-NAT]

In some ways the intent is not so bad an idea. But the enforcement will be an enfarcement!

I am tired of misleading and unaccountable jibberish but who is going to comb through the zillions of reviews?

[hwang]

I think it's pretty easily done. They could comb through every url domains owned, based on traffic ranking, or they could just look towards specific niche like maybe computer hardware, phones and gadget.

[A-NAT]

I am not sure how that makes it easier? Aren't we talking about a massive quantity even if you narrow it down?

[hwang]

When there's money to be earned, it can always be easy. I'm sure you understand what I mean. One only needs to zoom in on the big fish.

[A-NAT]

Yeah that probably does cut the number down significantly. good point by you, AGAIN!

[hwang]

Some goes with income tank department around the world. They usually aim those bigger fish or else time and resources spent is not worth it

[A-NAT]

Yes that is true with most scenarios if you think about it.

Like in the music industry they are not actively pursuing kids who illegally download a few songs a month. But the kid leaching hundreds or or more? Yeah they want their head on a chopping block.

[hwang]

Not sure how they are going to implement it, but once they do, I'm sure a lot of big fish will be in trouble. That is especially for the product reviewers who receive gift items for free.

[A-NAT]

Plus, along with your astute point, if some big fish go down that alone will deter many smaller ones.

And yes, good question, what is their plan of attack?

[hwang]

Not sure how they are going to move about doing it but as I said those site providing free product review should be the main target. Those who own top sites wouldn't actually write free review, unless....

[A-NAT]

Do you foresee a ripple effect? You think people will try to circumvent the process?

[hwang]

It will surely be a subject of discussion and unpleasant experiences ahead if the plan does get implemented.

[A-NAT]

It seems from my feeble understanding that there may be many a loophole. You think? Although we don't know the plan either.

[hwang]

Loophole in the sense that people will still get away from being taxed? Definitely.

[A-NAT]

Yes, that is what I was afraid of. But being such an immense undertaking, someone will always get away with it.

[hwang]

Ha maybe small small items like phones, laptops will get unnoticed but things like cars, houses would not get away undetected

[A-NAT]

I'm sure they will satrt with the biggies!