The FTC and blogola: here comes trouble

Last week, the FTC issued a ruling that will have the effect of cracking down on bloggers who write about free products without disclosing that they were, in fact, “compensated” for the post.

Disclosing payment is one of those “things you should have learned in kindergarten.” It’s common sense. It’s a basic component of the PRSA Code of Ethics, for example. Who would be against that? For example, here is how an article on Mashable framed the issue:

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.

Yet, something about the ruling seemed wrong to me. Then I read an excellent piece by Eric Felten in the Wall St. Journal. Felten writes the popular column, “How’s your drink?” and he made my objections clear.

Specifically, he notes that swag is a part of life at even the most high-toned newspapers and magazines: “Jumbo are the shrimp and deep are the highballs at most media events,” he writes. No newspaper is going to pay for a book reviewed in the Sunday section. No food writer is going to pay for the unsolicited cookbooks that arrive daily, hoping for some ink. And no sports writer is going to pay for that great seat in the media deck at the ballpark. Yet a blogger writing about an unsolicited book could be fined for failure to disclose.

In the United States, we don’t license journalists. There’s no corral that safely keeps journalists in and bloggers out. In fact, while the business model for newspapers slowly dies, we’re seeing interesting hybrids, publications like the Huffington Post, Politico, and hyperlocals like the Chi-town Daily News and the Beachwood Reporter. Who’s a journalist? Who can say? And the FTC rules also cover other, unspecified “word-of-mouth” marketers, whatever they are.

I agree with Felten: this regulation has a potential chilling effect on speech, while failing to show a serious harm that the ruling might protect us from. Dear FTC, give us some credit for being able to assess the veracity of what we read.

Here’s a final question raised by the ruling. I serve as a professor at Loyola University Chicago. Let’s say a prospective student arrives at my office and I provide a tour of our facilities, pointing out good things about our program. Do I have to disclose my salary to the student? Have I provided an “endorsement” for which I am paid? Am I a “word-of-mouth marketer?”

Does the FTC really want to look that closely into, well, everything?

photo credit: ashe-villain, licensed under Creative Commons

The FTC and blogola: here comes trouble

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