Bloggers in handcuffs? U.S. FTC proposes legislation on product testimonials

I write about strategies to turn fans into customers and customers into fans. I also share ways to use real-time strategies to spread ideas, influence minds, and build business.

Social Media  |  Public Relations  |  Corporate blogging

The U.S. Federal Trade Commission (FTC) is working on regulations covering blogs and social networking sites.

The revised guidelines on so-called "endorsements and testimonials" that the FTC is looking at could hold companies liable for false claims and statements made by bloggers and people who post reviews and comments on social networking sites, when the person commenting received product samples. And the people doing the posting may also be held liable.

Bloggers in handcuffs

While I am not a lawyer and I have not read through the proposed wording, stories out there such as this one from Iain Thomson of VNU suggest this is an important potential worry for people who talk about products that have been provided to them by a company.

Photo credit: Wikimedia

If you receive a product and write a testimonial about the experience online, you can be subjected to legal consequence on grounds of making false representations online.

Review copies of books

Here is a situation that comes up all the time. I give a free copy of one of my books to someone I meet at a conference. The person writes a review on Amazon or blogs about the book. What happens if a statement in the review is "unsubstantiated?" Will that person be held liable? Will I? Will my publisher? Yikes!!

So yes, I admit this book example may be seen as a bit extreme. But does the price of the item matter?

Is a twenty-dollar book different than a thousand-dollar digital camera?

Lots of bloggers take free product in exchange for talking up a company. I've seen some very elaborate programs such as those by orchestrated by Panasonic, Nikon, and Microsoft that put expensive equipment into the hands of influential bloggers.

For example, some bloggers received gear from Panasonic such as the Panasonic Lumix DMC-G1 camera and a Panasonic SDR-SW20S Waterproof Camcorder. Soon after, glowing blog posts and 5-star reviews on Amazon appeared. In the reviews I saw, the reviewer did disclose that they received the free gear.

While I have not accepted any expensive equipment myself, I get a handful of free books sent to me by publishers every single week. I've been an advocate of full disclosure when doing a review on an expensive product that you have received for free. But now that I think about it, I do not disclose that I received a book for free if I write about the book. Should I?

Misleading social media seeding techniques have become so widespread that the European Union enacted Consumer Protection from Unfair Trading Regulations to protect the public from the most deceitful activities. So yes, there is a problem.

While I do think that there is a social media ethics and disclosure issue here, do we really need to haul bloggers away in handcuffs?

What do you think?