From Volume 85, Number 1 (November 2011)
The Federal Trade Commission (“FTC”) adopted new disclosure rules in 2009 for “consumer-generated media.” The “Guides Concerning the Use of Endorsements and Testimonials in Advertising” warn bloggers, people who post on social networking sites, and other generators of new media content that they must disclose when they receive payments or free products related to what they write about. Failure to disclose material connections can result in fines of up to $10,000 for each violation.
The FTC endorsement rules do not apply to journalists who work for newspapers, magazines, or television and radio stations. When the guides were released, new media journalists protested that the government was creating a two-tiered regulatory regime that singled them out for unfavorable treatment. Jack Shafer, the media critic for Slate, called the rules “preposterous” and denounced “[t]he FTC’s [m]ad [p]ower [g]rab.”