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UPDATE 07/13/16: PewDiePie has responded to the wave of headlines surrounding the FTC's settlement with Warner Bros, asserting that his name is simply being used as "clickbait." According to PewDiePie, he was "not required" to disclose the sponsorship but chose to do so anyway, unlike many of his counterparts. He also pokes fun at the ensuing outrage, meaning this video is a must-watch:
See original story below.
If you take everything you hear from YouTube influencers at face value, now's a good time to listen up. Warner Bros. Home Entertainment, Inc. has settled Federal Trade Commission (FTC) charges of consumer deception related to the marketing of the 2014 video game Middle-earth: Shadow of Mordor. The deception, says the FTC, centered on the company's failure to be totally forthcoming about paying various influencers "thousands of dollars" in exchange for positive gameplay clips.
"Consumers have the right to know if reviewers are providing their own opinions or paid sales pitches," Jessica Rich, Director of the FTC's Bureau of Consumer Protection, said in a press release announcing the settlement. "Companies like Warner Brothers need to be straight with consumers in their online ad campaigns." The wildly popular PewDiePie was among those mentioned in the charges, with his own Middle-earth video clocking nearly 4 million views.
The game in question, which takes place between The Hobbit and The Lord of the Rings, used various YouTubers and other influencers to post the sponsored videos and share them across social media, without openly disclosing the fact that they were, you know, totally sponsored:
Instead, according to the complaint, Warner Bros. instructed influencers to place the disclosures in the description box appearing below the video. Because Warner Bros. also required other information to be placed in that box, the vast majority of sponsorship disclosures appeared "below the fold," visible only if consumers clicked on the "Show More" button in the description box. In addition, when influencers posted YouTube videos on Facebook or Twitter, the posting did not include the "Show More" button, making it even less likely that consumers would see the sponsorship disclosures.
As part of the settlement, Warner Bros. is now strictly required to educate influencers on sponsorship disclosures and is "barred" from future misrepresentation of sponsored content. As noted by the Verge, the "legally murky format" of YouTube has been prone to such scandals in the past. Maybe this settlement, in all its depressing glory, will have some positive impact.