<![CDATA[Gawker: valleywag, ftc]]> http://tags.gawker.com/assets/base/img/thumbs140x140/gawker.com.png <![CDATA[Gawker: valleywag, ftc]]> http://gawker.com/tag/valleywag/ftc http://gawker.com/tag/valleywag/ftc <![CDATA[Blogger Disclosure Tuesday a Small Storm of Sad]]> FTC regulations on blogger payola and freebies went into effect today, and bloggers have gotten busy disclosing their "material connections" to the people and companies they write about. Most of what's been disclosed is small-time, slapdash or downright stress inducing.

We have to admit the wave of disclosures hasn't been as massive as we anticipated yesterday, particularly if you exclude sarcastic disclosures like this marketing blog's list of all the free samples, zombie newspaper subscriptions and government handouts it received over the years.

It looks like some blogs got their disclosures out of the way earlier in the year, when the FTC rules first made news; the others, we presume, either aren't aware of the regulations or believe the federal government will be no more diligent regulating bloggers than it was regulating financial institutions. A reasonable bet.

The blogs that did disclose their freebies tended to lack the sort of deals — Sony, SeaWorld, etc. — professional fameballer Julia Allison laid on the line yesterday. Which is, frankly, a good thing; hopefully the blogosphere will remain this under-sold-out for years to come. Click the pictures below for some examples:

Music blog Guilt Free Pleasures: After its mom, "who reads Gawker religiously" according to an email it sent us, saw our post yesterday and pestered it, Guilt Free Pleasures disclosed that it got "most if not all" of its music for free from record labels and publicists and that it takes free concert tickets. But "our opinions have not been swayed by the fact that we are receiving this music for free." Oh whatever; we know you're planning to build a gilded mansion with those spare craptastic CDs, GFP. (Also, call your mother, already.)

High-profile Valley blogger and former PR executive Louis Gray: Reminded readers he is now a consultant for Paladin Advisors Group, with clients like ReadBurner, SocialToo and BuzzGain, as disclosed in previous posts. Gray then noted that there is no easy way to attach disclosures to "likes" on blog systems and social networks, or shares on Google Reader. Thanks for giving us something fresh and unexpected to worry about. Thanks a lot.

Christine Koh of mommy blog Boston Mamas: Wrote about that the practices of some fellow mommy bloggers "depressed" her; reiterated her longtime commitment "to transparency and 100% advertorial-free editorial — but said she wouldn't be disclosing her material ties on a per-post basis as the FTC recommends because "I operate Boston Mamas more like a magazine" and have a clearly detailed editorial code.

The disclosure, buried on the "Contacts" page, foreswears advertorial but says Koh accepts free review units, "junkets" and "swag," including gift cards, which she insists do not influence her coverage. So theoretically she could accept a free trip to Monaco, a trillion dollar gift card and a necklace of opulent jewels to review, all from the same vendor, and then never disclose this fact to her readers in the post. In fact, that very scenario occurs weekly for Koh, probably.

NonSociety blogger Jordan Reid: Like her corporate overlord/protocelebrity mentor Julia Allison, Reid wants to stay out of trouble with the FTC. So she promised to let readers know when her parents buy her an awesome dinner at a four-star restaurant; promised to not completely fabricate posts; and to overshare absolutely "everything" that happens to her with "total and complete transparency." None of that really has anything to do with the FTC regulations, Jordan, but it's, uh, good to know, and we're sure your boss over there is proud.

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<![CDATA[Feds to Hound Blogs for Acting Like Magazines]]> The image associated with this post is best viewed using a browser.Some writers accept free products, services or trips and then write "reviews" of said items. When magazines and newspapers did this it was fine, but now that bloggers have joined in, it may well become a federal offense.

The Federal Trade Commission is preparing guidelines around products, referral fees, travel and other freebies given to bloggers, the Associated Press reports, and intends to "clarify that the agency can go after bloggers - as well as the companies that compensate them - for any false claims or failure to disclose conflicts of interest."

Bloggers are so very dirty. AP:

Journalists who work for newspapers and broadcasters are held accountable by their employers... The blogosphere is quite different.

Except not really. The New York Times, for example, "for years... accepted free cellphone service, satellite TV service, music-download service, whatever," columnist David Pogue wrote in 2006 (the paper only changed this practice in the wake of a a controversy around Pogue's free use of a $2,000 data-recovery service). Over at Hearst's Esquire, restaurant reviewer John Mariani often eats for free, which is nothing compared to the free travel and resort stays other print writers accept.

At fashion-heavy magazines like those run by Condé Nast, free schwag helps make up for lackluster pay, a practice that became more widely known with the Vogue roman-à-clef Devil Wears Prada, in which an assistant's raid on the magazine clothes closet is a key plot point.

If the FTC is truly interested in protecting consumers, it will start its anti-shilling campaign with the media that accept the biggest gifts, make the most money and reach the most people. For the moment, at least, that means traditional media.

UPDATE: The FTC confirms to All Things D that it plans to go after even simple Amazon affiliate links.

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<![CDATA[Is Google Heading For an Antitrust Trainwreck?]]> Everyone has misunderstood why Google, from CEO Eric Schmidt on down, is cozying up to Barack Obama. It's not out of some likeminded geekiness. It's out of desperation and fear.

Google has a plan to extend its dominance in search and online advertising into every part of the information economy. It's no secret — it's in the company's mission statement. But antitrust cops look askance at efforts to use market power in one field to move into another.

When Obama appeared at the Googleplex in November 2007, his candidacy was far from preordained. Gullible techies hailed his platform as "Google-friendly." Sure, Google will be helped by support for faster broadband connections. And cofounders Larry Page and Sergey Brin share a cleantech obsession with Obama.

Schmidt was so lackadaisical about courting Obama that he only endorsed him in the waning days of the campaign, threw an inaugural ball, and got rewarded with a token appointment to a science council. For those obviously halfhearted gestures, he didn't get what he wanted: a free pass on antitrust issues.

When it comes to enforcing competition laws, the White House sees Google as just another big, overweening corporation. Assistant Attorney General Christine Varney, appointed last month, mused about Google as the next big antitrust target last summer.

And sure enough, Google is facing two antitrust cases already: one about book search, and another about its board's overlap with Apple. They come after antitrust cops unexpectedly shot down a search deal with Yahoo last year.

The investigation into Apple's board, half of whom are either Google board members or Google advisors, really has to do with the mobile-phone industry. Google makes an operating system for mobile phones, but it's free, so it's hard to argue that, say, T-Mobile's G1 Googlephone competes with Apple's iPhone. But that's a red herring.

The real problem is the potential for collusion in mobile search. Google used to brag about how much search traffic the iPhone generated for it — 50 times more than any other handset, Google executives said last year. One hasn't heard Google trotting out those kinds of statistics lately. Why make it easy for government antitrust prosecutors to see the connection between Apple's iPhone sales and Google's mobile search traffic?

Google executives seem deluded about the company's antitrust risks. In a video interview with BusinessWeek, Dana Wagner, Google's top antitrust lawyer, refuses to use the word "antitrust" to describe what he does. He calls himself a "competition counsel."

Who's going to get Google out of this mess? Not its outside lawyers, Wilson Sonsini. They prepared an analysis of the kind of board conflict Google faces with Apple, which concluded that there was a high risk of collusion. When John Paczkowzki of AllThingsD called to ask questions about it, the document got yanked off of Wilson's website, and deleted from Google's cache curiously fast. Conveniently, Microsoft, which has hired the lobbying firm where Eric Schmidt's ex-girlfriend works to stir up antitrust trouble for Google, still has a copy in its search engine's cache.

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<![CDATA[FTC gives Carl Icahn permission to acquire more Yahoo stock]]> CarlIcahn.jpgThe Federal Trade Commission says corporate raider Carl Icahn should feel free to buy more large blocks of Yahoo shares. At last count, Icahn already owned 4.3 percent of Yahoo. Shareholders allied with his view on the Microsoft-Yahoo merger — that it should happen — now control at least 31 percent of the company. Too bad for them it seems less likely every day that Microsoft CEO Steve Ballmer — or really, chairman Bill Gates — wants to go back down that road.

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<![CDATA[Google's answer to antitrust concerns over Yahoo deal: Whirlpool]]> Yahoo executives want to let Google serve ads next to its search results. But that would mean Google would be selling ads on 80 percent of all search queries online. Microsoft won't let that happen without stirring up antitrust fears in Washington. Secret Google sources tell the New York Times they plan to get around these concerns by schooling regulators on the concept of "co-opetition," which they say what Toyota does when it sells hybrid engines to GM, or when Whirlpool makes appliances for Sears.

Problem is, Toyota doesn't already own 61 percent of the car market. And even in its heyday, the Sears Catalog was never a portal to all the world's information the way Google search now is. Last time Google had antitrust trouble — with its DoubleClick purchase — Larry and Sergey paid for regulators to take a relaxing weekend in Colorado. Why don't they just spring for another junket? That seems easier.

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<![CDATA[Google's Aspen junkets for FTC commissioners just the start of its lobbying spree]]> StRegisResort.jpgIn 2007, Google spent $1.5 million lobbying Washington, D.C politicians and regulators. According to public filings, much of that cash went toward getting the Google-DoubleClick merger approved. Google says the rest went toward patent and copyright reform, online privacy, energy independence, getting funding for scientific research and education, increasing the H-1B visa quota and making the case for net neutrality. (Net neutrality is the belief that Google, not telephone companies, should dictate what's carried on broadband lines.) It's unclear whether the $1.5 million sum includes the money a Google-backed foundation spent hosting a 2007 Aspen Summit conference held at the St. Regis Resort in Colorado. FTC commissioner William E. Kovacic attended and he later voted to approve Google's merger. So did fellow commisioners Jon Leibowitz and Deborah Platt Majoras, who attended a similar conference in 2006.

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<![CDATA[ValueClick settles for $2.9 million in spam case]]> VLCK 52 Week March 17thValueClick's $2.9 million settlement with the Federal Trade Commission of charges it spammed users with deceptive offers was filed in federal court today. While ValueClick publicly announced the settlement terms last month, and gets away without having to admit wrongdoing, the bad news couldn't have come at a worse time. The company also stands to lose eBay's affiliate marketing business next month The company's stock was down 7 percent today, hitting a one-year low at $16.20 a share. Look for the company to start offering free iPhones to anyone who buys 50 shares of VLCK, subscribes to Ladies Home Journal and applies for auto insurance.

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<![CDATA[FTC seeks to bore online advertisers with proposals]]> creep-thumb.jpgFollowing its approval of the Google-DoubleClick merger, the FTC put out a series of proposals regarding privacy and online advertising. Dear God they're boring. But relevant nonetheless. Here are the bullet points.

    Proposed Principles
  1. Websites where data is collected for behavioral advertising should provide a prominent statement that (1) data is being collected for use in advertising and (2) consumers can opt out. Make this easy to do.
  2. Companies collecting data should provide security for it consistent with laws and the FTC's data security enforcement actions.
  3. Companies should retain data only as long as is necessary to fulfill a legitimate business or law enforcement need.
  4. No bait-and-switch allowed. A company must keep promises that it makes about how it will handle or protect consumer data, even if changes policies later. Before a company uses data differently from how it said it would when it collected it, consumers have to say OK. Mergers count.
  5. Collecting data for advertising purposes is only OK if consumers want to receive that advertising.

Still bored? How about a fun quiz? Count the number of ways Facebook's Beacon online ads would fail the FTC's proposals!

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<![CDATA[Despite the fact that her husband is a partner...]]> Despite the fact that her husband is a partner for a firm that represents DoubleClick, FTC Chairman Deborah Platt Majoras will not recuse herself from the Google-DoubleClick merger case, she announced today. I, however, am happy to recuse myself. But nobody's asked. [Beyond Binary]

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<![CDATA[Conflict of interest at FTC could delay GoogleClick merger]]> Two consumer advocacy groups say FTC chairman Deborah Platt Majoras has no place judging the merit of their privacy complaints stemming from the proposed merger of Google and DoubleClick. Majoras's husband, John M. Majoras, works as an antitrust lawyer at Jones Day. DoubleClick is a firm client. That's a conflict of interest, say the Electronic Privacy Information Center and the Center for Digital Democracy.

The FTC said its ethics division will review the situation, but noted that Jones Day has so far only represented DoubleClick before the European Commission. John Majoras claims not to be involved in this case. But as a partner in the firm, won't he profit from the case regardless of whether he works on it?

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<![CDATA[FTC getting an earful over Facebook privacy invasions]]> Photo by MarxchivistBetter hurry up with those rumored changes to Beacon, Mark Zuckerberg. The Federal Trade Commission, which we warned might pose a problem, is about to get on your case. According to reports, agitators from the Electronic Privacy Information Center and the Center for Digital Democracy just announced their intent to file complaints with the commission. Maybe it's time to quit thinking this uproar is the same as last year's brief, quick-fading News Feed protest.

Truth is, most of this hysteria will go away as soon as Facebook makes Beacon an opt-in-only option. And that should happen soon. Otherwise, complaints to the commission could turn into a wider FTC investigation of all of Facebook's privacy policies.

And given what we've heard about Facebook employees' bad behavior when it comes to snooping on users, you probably don't want the FTC to go there, Zuck. While we've been asking about what measures, if any, Facebook is taking to prevent employees from abusing their privileges (ever going to tell us?), the FTC has these things calls subpoenas, which aren't nearly so polite.

(Photo by Marxchivist)

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<![CDATA[The Federal Trade Commission announced yesterday...]]> The Federal Trade Commission announced yesterday that its decision regarding Google's purchase of DoubleClick will focus on antitrust rather than privacy issues. A decision could come this month. And this has absolutely nothing to do with the detailed search logs Google keeps on all queries originating from ftc.gov. [AdAge]

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<![CDATA[FTC privacy kick spells trouble for Facebook]]> creep.jpgFederal Trade Commission commissioner Jon Leibowitz is concerned. And not just about his obnoxiously redundant job title. In a "town hall" meeting held yesterday in Washington on the topic of online advertising and behavioral targeting, Leibowitz hinted that the agency might soon require users opt into behavioral targeting. Reportedly, executives from Facebook, Google, Microsoft and Yahoo were there to talk Leibowitz down from the ledge. This could be bad news for all them, but especially Facebook.

Google doesn't want to have to deal with this issue now, because one of the main reasons it acquired DoubleClick was for its behavioral targeting innovations. Much of Yahoo's advertising is already targeted to users based on they way they use its site.

But Leibowitz's sudden concerns come at particularly bad time for Microsoft and its new investment, Facebook. Facebook, rumor has it, is planning to announce a new behavioral targeting ad network, called SocialAds, next Tuesday in New York. Its master plan is to track the data users input into their profiles as well as the implicit information they communicate by interacting with other members. They'll then use the combined dataset to target these same users with relevant advertising as they visit other sites across the Internet.

But Leibowitz's concerns could quash all that. The FTC might demand that Facebook ask users to take part in such tracking before it can use their data. Obviously, it's unclear how likely Facebook users would be to opt into behavioral targeting. As this video indicates, there are at least some users paranoid enough to reject the idea.

To be fair, you have to wonder how many Facebook users smoke pot and dream up paranoid visions of what megacorporations will do with a list of their favorite books. It's hard to tell. Most probably don't care.

My guess is, that most new users will continue to click any check box Facebook puts on the screen during signup, including an opt-in for behavioral targeting. There's social pressure to join Facebook and it is much more powerful than abstract privacy concerns.

Leibowitz said yesterday that only 1 percent of all high school graduates actually understand privacy agreements when they read them. If Facebook members don't bother to understand what they're signing up for now, I doubt they will in the future.

Probably the only way Facebook could screw up this state of ignorance — blissful for the social network, at any rate — would be for the company to allow employees to abuse it.

Unfortunately for Zuckerberg and company, we've heard Facebook employees do muck around with private user information. The Silicon Valley sin here is that they aren't doing it to make money — they're doing it for their own entertainment.

Facebook has not officially said it's begun an internal investigation, but unless the activity stops, I'm sure we'll keep hearing about it. And so will Leibowitz. Facebook had better take this behavior seriously, or the FTC is going to strictly limit how it gets to use for its business what its employees look at for kicks.

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