The Federal Trade Commission (FTC) has introduced new rules that add muscle to the prevailing etiquette of social media that frowns on questionable endorsements or testimonies. For reports and commentary, check this article in AdAge and this post in Mashable. Going forward, bloggers and others using social media platforms will have to clearly disclose any “material connection” to an advertiser – including payments or free products. Fines will run up to $11,000 per incident. [Clarification: This claim was apparently incorrect. See explanation from FTC here.] This issue has been a heated discussion on the Web in recent years, as marketers have stretched the limits of acceptable practice while trying to present individual testimonies, reviews or comments as authentic. (For one example, see the recent tussle on the bloggers driving Ford Fiesta cars.)
Most of the comments on this move are positive, welcoming the new clarity and expecting the rules to make it harder for unscrupulous marketers pushing fake “word of mouth” to ignore the previously informal rules. Although the regulations focus on blogging, celebrity endorsements and advertising, social networks like Twitter will be impacted by the new rules.
Though transparency and authenticity ultimately drive credibility on the Web, these rules should reduce egregious abuses and help users make informed judgments on content. Another step in the evolution of social media.