January 26, 2010
The Federal Trade Commission (FTC) is one of the most unique parts of our government. It has a wide range of powers given by law, which encompass among other things the ability to pass rules and regulations against unfair and deceptive acts or practices. The FTC often issues “guidelines which are no more than notices that they will push for prosecution or civil action against individuals in violation their guidelines. Although these guidelines are often up for public debate, they are not passed by any governing body such as Congress, yet affect us often more than any newly passed law would. While many people see that the FTC is a consumer rights entity within the government, a growing number of people see that the FTC is a part of a growing, overreaching government that is interfering with the ability of businesses and often individuals to conduct business in this market economy.
I’m not claiming that the FTC should NOT prosecute obvious fraud, where consumers are clearly being scammed – such as not delivering a product as promised or the mass distribution of unsafe toys. That being said, the FTC’s guidelines and civil actions are quickly crossing the border of infringing not only on our ability to do business, but our First Amendment Rights to Free Speech. The Right to express one’s self and opinions, whether it is political or business related is an inherent part of our society and the foundations of our business community. The courts have ruled that advertising is a form of free speech, which cannot be infringed upon anymore than any other opinion, written or spoken.
Recently the FTC issued guidelines (http://www.ftc.gov/opa/2009/ 10/endortest.shtm) (which means, as said, we plan to bring action against someone) that regulate bloggers. Bloggers are a unique part of our economy, a throwback to the creation of this Country when people would often hand out pamphlets to express their opinion, in order to get attention to their cause. Bloggers are often people, like myself, who have taken the initiative to put their feelings down and write, taking the power away from larger media organizations, and putting it into the hands of the individual. As one knows, blogs often express anything from political opinion to diet tips. They are sometimes political, commercial, religious, or just something someone did in order to express their frustration at their parents. Whatever the reason is, they are a wonderful expression of our First Amendment Rights.
Yet the FTC believes that bloggers are so unique, that they need to be regulated in a way that has never been proposed to mainstream media. The FTC recently issued regulations in which they clearly state how bloggers who engage in commercial activity, should clearly state how they are related to the product, and make it obvious they are engaging in business, or have been paid to endorse the product. This uniquely affects the interactive advertising community, because it could easily be interpreted that any link, any mention of a product that would in turn create a sale (such as an affiliate link) would have to be clearly mentioned as an advertisement or state the nature of the relationship.
Additionally, more and more the FTC is engaged in the business of deciding what is considered an “authentic or substantiated” claim by an endorser or a product. While they have for the last decade or so, been more involved in cases in which they believe unsubstantiated product claims have been made, they are specifically targeting bloggers – and their opinions. This growing trend is more and more disturbing, as it gives the government the right to make assumptions on the quality and accuracy of claims of businesses – and then in theory, the accuracy of claims of individuals. It asks businesses and bloggers to basically “prove” what they are saying is correct, even if it is an opinion. They must substantiate according to the FTC, all their claims.
This is unique in nature, because it places an undue hardship often on small businesses and bloggers, who cannot afford to hire research teams or a huge law firm to assist them in the creation of their materials. A sole-proprietor who discovers that perhaps his home-made fig bars have lead to increased weight loss and energy, in theory, will have to prove and substantiate his claims before he could buy advertising on Google that states that these bars can help in weight loss. It could prevent a small business owner from selling knitted goods on Ebay, because the claim that they have kept her warmer than any other coat she owned, might be subject to scrutiny. They have to worry that the government, the FTC might intervene at some point and bring action against them based on perception and supposition. It gives bureaucrats, non-elected officials an extreme amount of power over small businesses in this Country.
The right of Free Speech in this Country is quite interesting, because it allows people to express their opinion, even if they are wrong. It assumes that no opinion is inherently wrong and opens up the possibility of debate. It also assumes that most adults are intelligent enough to make their own decisions regarding their dislikes, their opinions and the products they want to buy. The government, acting as “Big Mommy” is more and more interfering and saying that they want to regulate what we see and hear – that despite a huge Internet with tons of information, we can’t do our own research and decide if a product is what we want. We are giving the government more power than has ever existed before: the ability to sanitize what we hear and see before it’s released to the public.
“Government big enough to supply everything you need is big enough to take everything you have. The course of history shows us that as a government grows, liberty decreases.” – Thomas Jefferson
In perhaps the fastest growing industry ever, one person has made a name for himself as a leader and innovator. Pace Lattin, the publisher of the top newsletters in new media and online advertising, is one of the inventors of many of the technologies and methods that have become standards in the industry. He has been called many things, including a rabble-rouser, a guru, an innovator and a watchdog — but one thing stays the same: he is one of the most interesting leaders and commentators in the online advertising industry. Marketing Sherpa, a leading marketing research publication called him the most influential journalist in online media for a reason. Check out Pace’s Blog at: IndustryPace.com