The Interactive Advertising Bureau (IAB) is protesting portions of the Federal Trade Commission's new rules (pdf) governing endorsements and testimonials - namely its stepped up expectations of bloggers - and has called on the FTC to rescind these rules.
FTC Clamps Down

Released at the beginning of October, the new guidance for conforming to the FTC Act - the first since 1980 - touches upon endorsements by consumers, experts, organizations, and celebrities, as well as the disclosure of financial connections between advertisers and endorsers.

The guide ups the stakes for both endorsers and advertisers by clearly stating that both may be liable for false or unsubstantiated claims made in an endorsement - or for failure to disclose material connections between the advertiser and endorsers. The 1980 guides did not explicitly say that endorsers and advertisers could be liable under the FTC Act for statements they make in an endorsement.

The FTC also addressed the growing use of social media by 'celebrities' – who in this case could also be defined as bloggers or tweeters with a large following. In the new rules, these celebrities also must disclose their relationships with advertisers when making endorsements in blogs or tweets or on talk shows.

Finally, the revised guide eliminates a safe harbor for ads that illustrate a product's success that is not typical of its use - weight loss products being an obvious example. Now marketers must "clearly disclose the results that consumers can generally expect." This requirement represents a departure from the 1980 version of the guides, which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as 'results not typical.'

As a practical matter, the FTC doesn’t have the resources to look at 500,000 blogs, Richard Cleland, associate director for the FTC's advertising division, said via CNET. Rather, the new guide's goal is to raise awareness so that bloggers clearly disclose any financial relationship with companies to their readers.

IAB Calls for Withdrawal

Regardless of the FTC's resources and what it can practically accomplish, the IAB is calling on the FTC to withdraw the guidance, at least the portion regarding the opinions and commentary of bloggers. It argues that the rules unfairly impose penalties on online media for practices in which offline media have engaged for decades.

Specifically, the FTC’s distinction between offline media and online media is “constitutionally dubious” said Randall Rothenberg, IAB's president and CEO, in an open letter to the FTC Chairman Jon Leibowitz.