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Bloggers must disclose favours: FTC

16 Oct 2009

THE Bloggersphere, long hailed as the new electronic forum for unfettered comment and speech, is now to come under the scrutiny of US regulators.

The Federal Trade Commission (FTC) has announced it will crack down on bloggers who fail to disclose fees or freebies they get from companies for product reviews.

Offenders could face eventual fines of up to US$11,000 (A$12,500) in the FTC’s biggest overhaul of its 30 year old guidelines in order to account for the electronic world of blogging.

The policy will also apply to celebrities and research companies.

Bloggers, in the USA to now at least, have been free from such traditional fetters.

Consumers, however, have long argued that links between some bloggers and companies were not always transparent and clear for readers.

"Consumers are increasingly dependent on the internet for purchase information," Mr Jack Gillis of the Consumer Federation of America, was quoted in reports.

"There's tremendous opportunity to steer consumers in the wrong direction."

While there are no strict guidelines how disclosures are to be made, the FTC said they must be clear and conspicuous, within the body of reviews, for example, or on banners.

"That's left up to the endorser," said Richard Cleland, assistant director of the FTC's division of advertising practices.

The guidelines will take effect from 1 December.

In a statement the FTC said "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."

The new policy will also apply to Twitter, Facebook  and other forms of digital media.

While consumers may be happy, some defenders of internet free speech are outraged. Professor Jeff Jarvis, of  New York's City University and long time blogger attacked what he called "the FTC's misguided, dangerous ad/blog endorsement rules," in a blog post.

Learn more about digital content and Web-based business and marketing practices at the CeBIT Online Business Exhibition.

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