FTC Responds to IAB Letter on Blogger Guidelines

Yesterday the Interactive Advertising Bureau took a jab at the Federal Trade Commission's revised guidelines on online endorsements. Put simply, the guidelines call for online reviewers to disclose payment or affiliation with marketing campaigns or advertisers.

The way the IAB sees it, the FTC is unfairly favoring traditional media over digital media. In a letter sent to the FTC chairman, IAB prez Randy Rothenberg contended the FTC's call for disclosure of "material connections" between advertisers and endorsers in social media platforms will "shackle online media while exempting our offline cousins and competitors from equivalent constraint."

"I don't think that there is any favoritism based on the type of media," Rich Cleland, assistant director of the FTC's division of advertising practices told ClickZ News this morning. "The core here is do consumers understand the relationship that exists between the speaker and the seller." "Offline, if those lines are blurred, then there's a problem," he continued. "These are not new issues."

As iterated throughout his lengthy letter, Rothenberg and others fear that the FTC will now be on the hunt for bloggers reviewing and endorsing products, which he argues will squelch social media.

"In terms of bloggers and other endorsers...I don't think that there is any reason for concern," said Cleland, stressing, "We have explained on a number of occasions that we do not have civil penalty authority." In other words, he told me, the FTC is not planning an enforcement sweep against bloggers. Also, he confirmed, the FTC has no authority to fine anybody (despite countless erroneous reports to the contrary).

The IAB also suggested that the FTC guidelines are "perverse" and "constitutionally dubious," stating they imply "individuals writing in social media bear greater liability than do those writing for offline, one-way media."

"It's not clear what exactly the IAB thinks the constitutional issue is here," Cleland said. "The guidelines are in fact just guidelines and to the extent that they focus on [misleading] commercial activity and practices that are essentially promoting products in exchange for payments or free merchandise...we don't think that there's a constitutional issue."

As for the public hearing the IAB wants the FTC to hold to hash out the concerns, Cleland said, "We haven't made any determination on that.... We've already taken comments on this issue." Still, he added, "We don't want to preclude that we might do something in addition to [the comment period]."