FTC: Microsoft and EA Are Not Breaking Any Laws With YouTube Paid Endorsement Schemes

January 23, 2014 - GamePolitics Staff

While Microsoft (through a marketing partnership with Machinima) and Electronic Arts (through its "Ronku" marketing program) paying content creators to promote its games to followers on YouTube without disclosing the relationship may be unethical, neither company is breaking the law and it is unlikely that anyone involved could be fined for not disclosing a relationship according to what a Federal Trade Commission spokesperson tells Polygon.

"The guides are guidance to help advertisers and endorsers comply with federal advertising law," Betsy Lordan, with the FTC Office of Public Affairs told Polygon. "They are not legally enforceable, and there are no monetary penalties or penalties of any kind associated with them."

Interestingly enough, violating the guides won't get you in any kind of legal trouble but ignoring the guides could lead to trouble down the road.

"So (for example) if an advertiser is not following these guidelines, there is no penalty. But the FTC could send a warning letter and if the problem is not eventually resolved, the agency could opt to open an investigation," says Lordan. "But the ultimate charge (if the FTC decides to follow through) would be a violation of the FTC Act (violation of federal advertising law) and not a violation of the Guides. (It is not technically possible to violate the Guides because unlike regulations, the Guides are not legally enforceable.)"

Lordan went on to say that the FTC isn't currently "conducting any research into the use of their guidelines for endorsements" and declined to comment on any active investigations into game publishers over breach of the federal advertising law.

Source: Polygon


Comments

Re: FTC: Microsoft and EA Are Not Breaking Any Laws With ...

This probably relates to the new ruling from the DC Court that stated the FTC can't act as a regulatory body over the Internet, or internet communications because they have yet to classify it properly.  So we're still waiting for the FTC to classify the internet before it can have enforcement over it.  but as the article states, it's still Advertising, so the FTC could send them a warning and go after them under those regulations..

 
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