ftc-building

Microsoft caused a minor stir after a report revealed that the company had teamed with Machinima to pay YouTube creators a $3 CPM for positive reviews of the new Xbox One console. The controversy stems from the FTC guidelines on these sort of promotions, which require full disclosure from the paid party. In the latest development, the FTC has clarified its position, ensuring game companies and YouTubers alike that they have nothing to worry about.

The FTC commented on its guidelines and noted that they are just that–guidelines. Their only goal is to clarify the complicated federal advertising rulebook. “The guides are guidance to help advertisers and endorsers comply with federal advertising law,” said Betsy Lordan of the FTC Office of Public Affairs in an interview with Polygon. “They are not legally enforceable, and there are no monetary penalties or penalties of any kind associated with them.”

Lordan also explained how, even if one of these deals went against the FTC’s laws, participating companies would first be given a warning before any investigation was launched. Even on the second offense, YouTubers would likely still be free from blame; it is the game companies that would take the heat.

Basically, it’s highly unlikely that Microsoft, Machinima, EA, or any other company involved in partially-disclosed YouTube deals will ever face any sort of repercussions, even if they did break FTC laws, which is pretty clearly not the case. And with that, I think we can put this story to bed, though with YouTube’s track record, who knows if it will pop up against at some completely inopportune time.

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