On the surface, the Federal Trade Commission‘s new ruling focuses on banning fake reviews and testimonials, targeting businesses that pay for positive feedback or use generative AI to make false testimonials. But there’s something else in this ruling that affects the creator economy: a provision that bans “fake social media indicators,” including viewbotting.
That part of the ruling will crack down on content creators who buy fake views and followers, especially if they’re buying those fake views/follows to pump up their results for a commercial reason.
So, for example, a Twitch streamer who buys fake viewers to fluff their numbers for a sponsored stream (possibly securing themself more money from that sponsor, or make themself look more attractive to other sponsors) would be in violation of this ruling.
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To be clear, viewbotting–the use of automated programs that make it look like livestreams have more views than they actually do–is already against Twitch’s TOS. But the platform has had a long-running problem combatting viewbots, as has competitor Kick, and while “we will terminate your account if you viewbot” is a deterrent for some people, it doesn’t put others off.
This ruling might be a stronger deterrent. It kicks in October 13, and will allow the FTC to levy fines against content creators who violate it.
“Fake reviews not only waste people’s time and money, but also pollute the marketplace and divert business away from honest competitors,” FTC Chair Lina M. Khan said in a statement. “By strengthening the FTC’s toolkit to fight deceptive advertising, the final rule will protect Americans from getting cheated, put businesses that unlawfully game the system on notice, and promote markets that are fair, honest, and competitive.”
The provision about fake social media indicators does have some restrictions, though. The reason our example above mentions sponsored streams is because the FTC says its ruling is “limited to situations in which the buyer knew or should have known that the indicators were fake and misrepresent the buyer’s influence or importance for a commercial purpose.”
We think viewbotting a normal stream would still violate this rule, as streamers do earn money from non-sponsored streams through things like ads and viewers buying channel subscriptions, Bits, and more. But it could be difficult for the FTC to make a cause-and-effect case for a streamer using viewbots and a viewer, the consumer, then buying a subscription or Bits. Cases where viewbotting is involved for the purpose of getting more viewers to tune in for a sponsored or even shoppable stream could be easier to prove.
Either way, it’s clear the FTC continues to keep its eye on our industry. In the past, it’s cracked down on creators for failing to properly disclose ads, with platforms like YouTube and TikTok responding to that problem by rolling out tools that make it easier for creators to label sponcon.
