The Internet Advertising Bureau has come out against new guidelines proposed by the Federal Trade Commission that would require bloggers to disclose their affiliations with sponsors, marketers, and free giveaways. The reason? The IAB claims that the rules unfairly regulate online media more than offline.
"What concerns us the most in these revisions is that the Internet, the cheapest, most widely accessible communications medium ever invented, would have less freedom than other media," IAB president and CEO Randall Rothenberg wrote in an open letter to FTC chairman Jon Leibowitz. "These revisions are punitive to the online world and unfairly distinguish between the same speech, based on the medium in which it is delivered. The practices have long been afforded strong First Amendment protections in traditional media outlets, but the Commission is saying that the same speech deserves fewer Constitutional protections online."
He illustrated it with a personal example:
So there I was last Saturday, about to send out on my Twitter feed--which automatically updates my Facebook page and links to my personal blog--a photograph of this wonderful baked halibut dish I'd just made as a surprise for my wife. I was in the middle of typing a rave review of the recipe, which I'd pulled from my favorite cookbook, "Delicioso! The Regional Cooking of Spain" by Penelope Casas. But before I could press the 'post' button, I stopped and canceled the whole thing.I remembered that the book was a freebie, sent to me by an editor at the Alfred A. Knopf publishing house 13 years ago. And I didn't want you guys to haul me into court and fine me for violating the rules you've just promulgated to muzzle social media.
The FTC has said that the rules, which stipulate that violations may face up to $11,000 in fines, are designed for education rather than punishment. But Rothenberg isn't buying it.
"The Guides do allow you to pursue bloggers," he insisted. "They do hold individuals more liable than larger corporations. They do explicitly say online social media have less protection than offline corporate media. They do obstruct online companies' opportunities to drive cultural conversation more than offline companies'. They do threaten with prosecution book publishers, movie producers, and other companies that supply products to individual social media conversationalists."
The bigger problem is that offline media isn't subject to the same restrictions, he explained. And, according to the letter, clamping down on one medium but not another constitutes a First Amendment violation.
The FTC has not yet responded publicly.
(Credit:
Josh Lowensohn/CNET)
Prominent users of Twitter and Facebook won't be exempt from controversial new Federal Trade Commission guidelines that keep tabs on blogger freebies and giveaways, according to Richard Cleland, associate director for the FTC's advertising division. The agency absolutely plans to keep tabs on social networks as well as blogs in accordance with revised regulations that could see violators fined up to $11,000, he said.
Here's a sample scenario: a celebrity or other prominent figure with loads of friends on Facebook receives free hotel says from Hotel Chain X in exchange for running Hotel Chain X ads on his or her blog. If that person then signs up as a Facebook fan of Hotel Chain X--which, remember, could mean that the person's name can show up for his or her Facebook friends alongside Hotel Chain X display ads on the social network--he or she could be held liable by the FTC.
"It would be the same thing if you were going to pay the celebrity a thousand dollars to go register as a fan," Cleland said. "In that case, there wouldn't be any question about it."
Facebook spokesman Barry Schnitt told CNET News that the social network doesn't have anything concrete to say in reaction to the new regulations just yet. "I don't think we have anything to say other than that we've had an ongoing dialogue with the FTC and we'd love to talk to them more about what this means," Schnitt said. "I think we're already consistent with the spirit of it."
Schnitt added that some of the practices that may be encompassed by the new FTC guidelines are already banned by Facebook. "We say in our statement of Rights and Responsibilities, and people actually applauded this when we added it in a few months ago, that you will not use your personal profile for your own commercial gain such as selling your status to an advertiser." This is contained in section 4.2 of the document, he said.
As for Twitter, the FTC isn't letting you get a pass with the excuse that 140 characters--Twitter's famous text limit--is simply too short. "There are ways to abbreviate a disclosure that fit within 140 characters," Cleland said. "You may have to say a little bit of something else, but if you can't make the disclosure, you can't make the ad."
The question still remains as to exactly how the new guidelines will be enforced, given the sheer scope of online media--not to mention the millions upon millions of active Twitter and Facebook users.
"As a practical matter, we don't have the resources to look at 500,000 blogs," Cleland said. "We don't even have the resources to monitor a thousand blogs. And if somebody reports violations then we might look at individual cases, but in the bigger picture, we think that we have a reason to believe that if bloggers understand the circumstances under which a disclosure should be made, that they'll be able to make the disclosure. Right now we're trying to focus on education."
That's worth highlighting. Small-time bloggers freaking out over whether the FTC will really crack down on them may be pleased to know that the FTC at least claims its aim is to make everyone aware of what's right and wrong rather than to hunt down every Twitter user who may have been given a free toaster or something. Unless, that is, somebody rats them out--and at least one blogger is already raising concerns that angry readers may use the regulations to attempt to get back at blogs they don't like.
Industry blogger Peter Feld of Brandchannel thinks he can see another outcome. "A safe prediction for 2010: some big scandal when the first celebrity to run afoul of the new rules, by promoting a product on Twitter or a talk show, gets fined by the FTC."
This post was updated at 5:13 p.m. PT with comment from Facebook.
Maybe Ben Huh really could solve all of Gourmet magazine's problems.
(Credit: Caroline McCarthy/CNET)The bittersweet jokes write themselves.
Ben Huh, the CEO of funny photo hub "I Can Has Cheezburger," who has been known to show up at black-tie events with a giant hamburger hat on his head, on Monday offered via Twitter to purchase Gourmet, the seven-decade-old, high-end cooking magazine that will be ceasing publication in November as part of budget cuts at parent company Conde Nast.
Huh was probably kidding. We think.
The recent ax job at Conde Nast, long a symbol of print media's most egregious of excesses and more recently the ultimate case of a postlapsarian publishing-industry crisis, received quite the reaction from the blogging and Twittering masses--a crowd that's notoriously easy to ignite with debate and banter over the death of print and future of the media. Along with Gourmet, the company announced the closing of titles Cookie, Modern Bride, and Elegant Bride on Monday.
Management consulting firm McKinsey had been enlisted earlier in the year to help Conde Nast handle its increasingly dire financial problems, so many people had been anticipating magazine closures (the fledgling business title Portfolio and home decor magazine Domino were silenced earlier this year).
But it was beloved industry mainstay Gourmet that really set off the blogosphere. Easy way to tell: the title became a "trending topic" on Twitter.
Media critic Rex Sorgatz offered his tongue-in-cheek take on the Conde Nast magazine shutterings.
(Credit: Twitter)Reactions ranged from "Is it strange that Gourmet folding feels like losing an old friend?" to "So. I'll never be Editor in Chief of Gourmet. Time to reassess my life goals" to "Wow. I guess I'll be eating more TV dinners now."
Twitter's ubiquitous celebrity users weighed in, too; pop singer Michelle Branch tweeted "First Domino and now Gourmet. What the hell!!?? Let's have a moment of silence."
It's sad to see such a long-lasting magazine disappear so quickly. But in the grand scheme of things, it's not surprising. Recipes are easy and convenient to put on the Web, not to mention searchable--and indeed, Gourmet recipes will live on at the Conde Nast-owned Epicurious.com. And food news has increasingly shifted to the Web with the growth of the food blogging craze, something that was exemplified in a snarky publicity stunt last week when restaurant industry blog Eater, which had just launched a "national" edition to go along with its regional sites, offered to pay any of the Web's "about 1,000,000 cutesy food blogs" $25 to shut down.
"Gourmet probably took the $25 to stop writing about food," one Twitter user quipped on Monday.
Independent bloggers who fail to disclose paid reviews or freebies can face up to $11,000 in fines from the Federal Trade Commission, according to revisions to the agency's "Guides Concerning the Use of Endorsements and Testimonials in Advertising" published Monday.
This marks the first time that the Guides document has been updated since 1980.
"The revised Guides also add new examples to illustrate the long standing principle that 'material connections' (sometimes payments or free products) between advertisers and endorsers--connections that consumers would not expect--must be disclosed. These examples address what constitutes an endorsement when the message is conveyed by bloggers or other 'word-of-mouth' marketers. 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 FTC also has its eye on celebrities. "Celebrities have a duty to disclose their relationships with advertisers when making endorsements outside the context of traditional ads, such as on talk shows or in social media," the release explaining the revisions explained.
That means, theoretically, that if a celebrity gushes about a new car on his or her Twitter account and it turns out that the car was given away for free, the celebrity could be fined by the FTC.
Word of the FTC's crackdown on blogger endorsements first broke in June and set off a wave of chatter in communities of bloggers who are well used to receiving and keeping free products from marketers and PR agencies--most notably the thriving "mommy blogger" sector.
It's going to be hard to police--there are a lot of bloggers out there, not to mention a lot of different kinds of bloggers, and a lot of marketers. And as some media critics have pointed out, undisclosed endorsements of freebies have plagued some sectors of the magazine industry for decades now.
Blogging service Tumblr has raised $4.5 million in a second round of funding from its current investors, according to a report on AllThingsD.
Union Square Ventures and Spark Capital ponied up another round, bringing the company's total VC funding to $5.25 million and giving the company an estimated valuation of $15 million, according to the report. Tumblr provides a means for people to create, edit, and post blogs.
Tumblr is a free site that reportedly is leaning toward developing premium services to sell to its members, rather than latching onto an advertising-based revenue model.
Founder David Karp is aiming to generate revenue early next year, according to the report.
That should bode well for the company, which earlier this year launched a new feature that provides bloggers with the means to let others add content to their blogs.
Response among in tech journalists to Yahoo's layoff announcement and profit drop runs the gamut. But on one thing they agree: it could have been worse.
Here's Stephen Shankland's analysis following the call. And here's what some others are saying in the debrief:
Weaker results? Check. Guidance going forward weaker still? Check. Layoffs? Check. Economy sucks? Double check! Nonetheless, Yahoo CEO Jerry Yang said he "remained optimistic" about Yahoo and was going to "get fit" and power through its obvious troubles. Get this guy over the to McCain campaign pronto! Yahoo's news was about as good as the polls are going for the Republican presidential candidate...Revenue at the Sunnyvale-based Yahoo was $1.78 billion, slightly up from the $1.76 billion from last year's third quarter. In other words, bad but not the worst. That's to come, apparently, as Yahoo also warned of a tougher outlook for the months ahead.
--Kara Swisher, All Things DigitalResults and guidance as expected: crappy, but not terrible. EPS in line. Revenue low end of guidance range. EBITDA low end of range. Guidance weak. 10 percent + of workforce will be fired in Q4 (1,500+). Employees will be notified in the next few weeks.
--Henry Blodget, Silicon Alley InsiderIt's come to this--when Yahoo slashes 10 percent of its workforce and sees profits slide 64 percent, Wall Street is happy because it could have been so much worse.
--Sam Gustin, cited in PortfolioNow, these figures may not seem too bad and would seem that Yahoo is achieving its projected earnings and income, but that's what you get for not projecting too achieve too much given its current market performance and market share."
--Arnold Zafra, Search Engine JournalIt was somewhat miraculous: Yahoo delivered third-quarter earnings that landed squarely in line with Wall Street estimates, despite a dramatic slowdown in the display ad market; a delayed search deal with Google; and a global financial crisis...In anticipation of a rotten year, the company said it will reduce headcount by 10 percent in the fourth quarter...This time around, there's some hope that a) Yahoo will actually follow through on its plan, and b) that the layoffs will eliminate some of the bureaucratic, money-sucking middle managers.
--Betsy Schiffman, Epicenter
Between 2,000 and 3,000 liberal-leaning bloggers are getting some face time this week, in hopes of gathering strength before the fall election.
The four-day Netroots Nation 2008 conference, which started Thursday in Austin, Texas, will feature more than 150 speakers and 125 panel discussions and events.
With the presidential election less than four months away, the conference is attracting the attention of a number of Democratic heavyweights--with the major exception of presidential candidate Barack Obama himself. According to the Austin American-Statesman, Obama apparently bowed out due to a planned trip to Europe and the Middle East.
Keynote speakers include House Speaker Nancy Pelosi (D-Calif.) and two former presidential hopefuls: Howard Dean, who now leads the Democratic National Committee, and retired Gen. Wesley Clark. Lawrence Lessig, a Stanford law professor and founder of Change Congress, will also speak.
Panels include "Pundit Project: How To Outtalk The Talking Heads," "Sunshine Laws For Bloggers," and "Measuring and Managing Your Online Paid Advertising Campaigns." There are also caucus meetings such as ones for Native Americans, Latinos, African Americans, "geeks," "moms," "street prophets," and Mother Jones readers.
This is the third annual such conference, which was previously known as YearlyKos, and the first one that could help influence the outcome of a presidential election. Netroots Nation, a site where liberal bloggers converge, was originally part of the Daily Kos blog--thus the previous name of the gathering.
"Bloggers want to be involved in the election of the next president," Matt Glazer, editor of the Austin-based blog Burnt Orange Report, told the Austin American-Statesman. "Networks of bloggers aren't just talking to one another; they are making very strategic decisions about the issues they want to discuss."
At the same time the liberal bloggers are meeting, their conservative counterparts are gathering in Austin as well. The Texas Defending the American Dream state summit will be markedly smaller than the Netroots Nation gathering, with about 300 expected, according to the Statesman. But its speakers include Libertarian presidential candidate Bob Barr.
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