FTC tackles honesty in social media site ads

Posted by Emily Dilling on April 6, 2009 at 4:18 AM

The Federal Trade Commission has proposed regulating advertising on social-media sites, paidContent reported.

The U.S. trade body's regulations would monitor sites for "false statements" in blogs and other entries, raising the bar for quality and honesty in online journalism and inspiring fear in trade organisations that worry the new standards could seriously harm the growth of social media sites.

The regulation changes are the first since the FTC renewed its guidelines in 1980. The commission explained the updates, citing comments on discussion boards posted by paid "brand evangelists" and bloggers that make money off of their entries as reasons for increased attention to the sites, paidContent reported.

Richard O'Brien, president of the trade organization 4A, wrote in a letter to the FTC that the regulations would discourage bloggers from creating online content, stating, "bloggers and other viral marketers will be discouraged from publishing content for fear of being held liable for any potentially misleading claim."