How BlogHer deals with reviews and con­flicts of inter­est from JD Lasica on Vimeo.

I’ve been struck by the vary­ing reac­tions to this week’s news that the Fed­eral Trade Com­mis­sion will now begin to reg­u­late prod­uct endorse­ments not just in adver­tise­ments but also on blogs and other forms of social media. (PDF here; the regs don’t start until page 55.)

Two heavy­weight blog­gers and long­time free speech cham­pi­ons Jeff Jarvis and Dan Gill­mor — bless them — have lam­basted the FTC for its move into the online arena (here are Jeff’s and Dan’s posts, and reader com­ments). While I think skep­ti­cism is in order, and the specifics of the government’s involve­ment need to be more clearly defined, in the end I believe the FTC’s move is a healthy and wel­come devel­op­ment for social media.

I’m cou­pling my thoughts on the FTC rul­ing with an inter­view (above) I did a while back with Jory Des Jardins, co-founder of BlogHer, which I’ve just got­ten around to pub­lish­ing today. In it, Jory describes how JCPen­ney approached BlogHer with the idea of hav­ing blog­gers in its net­work of 2,500 blogs write about its new line of Lin­den Street fur­ni­ture as part of BlogHer’s review program.

As in its past deal­ings with retail­ers, the BlogHer exec team decided on this approach: It would allow a dozen blog­gers to accept $500 gift cards to pur­chase fur­ni­ture from JCPen­ney, but only on the con­di­tion that the blog­gers fully dis­close the rela­tion­ship with both Pen­ney and BlogHer, that the blog­gers be free to write reviews and pro­duce videos telling about their expe­ri­ence — both pos­i­tive and neg­a­tive — and that the review­ers could not accept any adver­tis­ing from JCPen­ney. Impor­tantly, they were not paid to write prod­uct endorse­ments but to write reviews. BlogHer then assem­bled their posts into a wid­get, which they ran across their blog network.

JCPen­ney was “thrilled” with the pro­gram, and so were the blog­gers. (You can judge for your­self about the qual­ity of the reviews; this one was typ­i­cal. The authen­tic­ity is what makes this valu­able to mar­keters.) BlogHer has run sev­eral sim­i­lar retailer part­ner­ships — and in each case, Jory says, the key ingre­di­ent was disclosure.

Watch, embed or down­load the video on Vimeo

Lisa Stone, another co-founder of BlogHer, evoked the same themes in her keynote address to the Online News Asso­ci­a­tion con­fer­ence on Sat­ur­day. One rea­son for BlogHer’s con­tin­ued growth and suc­cess, she said, was they adhere to the same stan­dards and prac­tices that tra­di­tional jour­nal­ism insti­tu­tions have built up over the decades. By 2006, BlogHer “became the school­marms of the Inter­net,” Lisa said.

Every one of the 2,500 blog­gers par­tic­i­pat­ing in the BlogHer net­work must fax in a signed agree­ment to abide by BlogHer’s com­mu­nity guide­lines. BlogHer blogs must not con­tain “edi­to­r­ial con­tent that has been com­mis­sioned and paid for by a third party, (either cash or goods in barter),” the guide­lines say, and so I wish the guide­lines page would address how reviews fall into a dif­fer­ent cat­e­gory. (For the record, I think the way BlogHer has done this is absolutely fine, though this would vio­late many news­pa­pers’ policies.)

Lisa also made clear that BlogHer has no desire to impose its guide­lines on the entire Inter­net. “We don’t believe in a uni­ver­sal stan­dard for the Inter­net,” she said.

Fair enough. It’s not BlogHer’s job to police the Inter­net. Nor mine. Nor the Media Blog­gers Association’s. Two years ago I chaired a com­mit­tee to write the association’s State­ment of Prin­ci­ples, which includes this:

“Clearly dis­close con­flicts of inter­est includ­ing per­sonal rela­tion­ships, finan­cial con­sid­er­a­tions or any­thing else that might influ­ence or appear to influ­ence your inde­pen­dence and integrity. If you accept pay­ments from adver­tis­ers or spon­sors, clearly demar­cate adver­to­r­ial from edi­to­r­ial content.”

Jeff was against even those vol­un­tary guide­lines. But the MBA, too, made clear it was impos­ing those stan­dards on its own mem­bers, not on all bloggers.

In social media, an explo­sive growth in decep­tive practices

While it’s impos­si­ble to mea­sure pre­cisely, we’ve seen an explo­sion in decep­tive uses of social media, par­tic­u­larly over the past six months. Pay­ola goes out to blog­gers who embed com­mer­cial links (with­out dis­clos­ing it). Twit­ter­ers are now paid to tweet about their spon­sors — mak­ing us won­der whether a pro­mo­tional tweet is gen­uine or merely pay-per-tweet. Direct-message come-ons by peo­ple I’ve (mis­tak­enly) fol­lowed on Twit­ter now fill my Twit­ter in-box.

As Time wrote this week:

At a site called Spon­sored Tweets, Twit­ter users can sign in, set the price they want com­pa­nies to pay them for tweet­ing an ad on their behalf and wait for the offers to come in. Joce­lyn French, the mother of a 2-year-old boy and 1-year-old girl, has tweeted for a par­ent­ing web­site, a college-information site and Kmart, among oth­ers, at $1 a pop. “I fig­ure, hey, why not get paid at the same time?” French says. On aver­age, com­pa­nies are pay­ing Spon­sored Tweets users $29 per tweet.

Years ago, Dave Winer fret­ted about com­mer­cial inter­ests pol­lut­ing the free exchange of ideas in the blo­gos­phere. Well, now those com­mer­cial inter­ests threaten to pol­lute all of social media.

This is not a new debate. Lewis Per­due and I drafted a set of eth­i­cal giude­lines that we sug­gested com­mer­cial blogs vol­un­tar­ily incor­po­rate back in the early part of this decade. And I wrote a series of arti­cles about online ethics and news sites for the Online Jour­nal­ism Review:

• Ethics codes: A com­pact of trust (1998)

• The cost of ethics: Influ­ence ped­dling in the blo­gos­phere (2005)

And so, even though gov­ern­ment involve­ment in any aspect of the online arena must be care­fully con­sid­ered, I wel­come the FTC’s rul­ing and hope that Sil­i­con Val­ley can work with the agency to make sure it doesn’t become overzeal­ous. (Agency offi­cials have already said they’re unlikely to go after any indi­vid­ual blog­gers.) The details of the FTC’s rule-making are far from per­fect, and its appli­ca­tion in other areas needs to be exam­ined, but let’s keep focused on the cen­tral prin­ci­ple of trans­parency and truth in advertising.

I think Jeff and Dan are mis­taken. This is not about free speech. It’s about decep­tive prac­tices that need to be dis­closed — a decades-long role that the fed­eral gov­ern­ment has played in all kinds of media, from the FTC to the FDA. (And no one says you have to dis­close your rela­tion­ship in every Twit­ter tweet. Tweet your prod­uct, then tweet your rela­tion­ship with the company.)

On-the-up-and-up review­ers like Steve Garfield, and the BlogHer blog­gers, and my own blog and count­less thou­sands of oth­ers have long played by the rules of fair­ness and dis­clo­sure. Nobody’s explained why the Decep­ti­cons should get a free pass. While Inter­net pio­neers have hoped we would be able to self-regulate the flood of online decep­tion, that clearly has not hap­pened. So it’s wel­come news that the Obama admin­is­tra­tion has taken a step toward weed­ing out the char­la­tans, just as it’s appro­pri­ate that ear­lier admin­is­tra­tions went after spam­mers and this admin­is­tra­tion is push­ing for net­work neutrality.

In all three cases, the online mar­ket­place of ideas — which we’ll be spend­ing an increas­ing amount of our time in — can­not be allowed to turn into a cesspool.

Related

• FTC: FTC Pub­lishes Final Guides Gov­ern­ing Endorse­ments, Testimonials

• FTC: Guides Con­cern­ing the Use of Endorse­ments and Tes­ti­mo­ni­als in Adver­tis­ing: Notice Announc­ing Adop­tion of Revised Guides (PDF)

• Time: Brought to You by Twitter

• BuzzMa­chine: FTC reg­u­lates our speech

• Dan Gill­mor at Medi­ac­tive: A Dan­ger­ous Fed­eral Inter­ven­tion in Social Media

• Medi­a­bistro: Trans­parency is key

• Read­WriteWeb: FTC to Blog­gers: Dis­close Free­bies or Face $11,000 Fine

• EdRants: Inter­view with the FTC’s Richard Cleland.

• Medi­a­bistro: New IZEA Fea­tured Blog­ger Julia Alli­son For­gets Dis­clo­sure, Keeps Job

JD Lasica works with major com­pa­nies and non­prof­its on social media strate­gies. See his busi­ness pro­file, con­tact JD or leave a comment.

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