A recent ruling by the FTC on word-of-mouth marketing has resulted in controversial PayPerPost's requiring its bloggers to disclose that they are being paid to blog about a product or service.

The startup quickly drew fire in the blogosphere earlier this year when it announced a plan to compensate bloggers for blogging about products and services, while making disclosure of the compaensation voluntary by the bloggers, ClickZ writes. CEO Tom Murphy has decided to amend the site's terms of service to make such disclosures mandatory.

"With the recent announcements by the FTC and feedback from bloggers and readers and advertisers, it became apparent we need to do something to enforce some rules for the marketplace." Murphy explains.