Smugglers Ponderings: On the FTC Guidelines & The Book Smugglers

Today the Federal Trade Commission (FTC) published its final revised guidelines governing endorsements and testimonials. While this usually would not be of interest or concern us in any way, these revised guidelines have a new stipulation covering bloggers and other word-of-mouth marketers. From the FTC Press Release:

The revised Guides specify that while decisions will be reached on a case-by-case basis, the post of a blogger who receives cash or in-kind payment to review a product is considered an endorsement. Thus, bloggers who make an endorsement must disclose the material connections they share with the seller of the product or service.

Basically, what this boils down to in our situation is that any bloggers who receive books from publishers/publicists/authors in return for a review or giveaway published on that blogger’s site is now an official, legal endorsement. **Note that “endorsement” in this sense does not necessarily hold a positive valuation as it does in the everyday vernacular – it simply means a promotional statement. For the full-on legalese, the FTC Guidelines currently define an endorsement as “any advertising message (including verbal statements, demonstrations, or depictions of the name, signature or likeness or other identifying personal characteristics of an individual or the name or seal of an organization) which message consumers are likely to believe reflects the opinions, beliefs, findings, or experience of a party other than the sponsoring advertiser.”**

And since this exchange now qualifies as an endorsement, bloggers need to disclose the specifics of their relationship with whomever provided that book.

Now, the FTC did not specify HOW bloggers should go about disclosing things, so we’re just going to explain our position and how we plan on disclosing this information in the future (in the spirit of full disclosure and all that).

If you read The Book Smugglers, you know that we have a bunch of giveaways. We also receive books from publishers, third party publicists, and of course, from authors themselves. We LOVE receiving review copies, and we encourage publishers et al. to contact us if they have review or giveaway copies they think we’ll be interested in. Review copies are great, because when you read as much as we do, spending on books can really add up. That said, this next point should be painfully obvious and self-explanatory for any reviewer:

We DO NOT promise a positive endorsement for ANY book that we receive.

We pride ourselves on our honesty, even when our opinions might not be popular ones (see our recent review of Gail Carriger’s Soulless). Any blogger worth their salt won’t trade glowing reviews for free books (or, heaven knows, cash) – this is the kind of thing that readers pick up on. We all know there’s a huge difference between the Harriet Klausners of the review world and review sites like Dear Author, for example. In this sense, the revised FTC Guidelines really don’t affect us, because we think we make it pretty clear that we are not some kind of publisher automatons that parrot back positive reviews for every book we read.

That said, we do plan on making a few changes to honor the FTC Guidelines.

In our reviews, we have a section titled “Why did we read this book” in which we informally disclose our motivations for reading a book – and oftentimes we’ll also use this section to say if we received an ARC of the book, a review copy from the publisher/author/publicist, or if we shelled out for the thing ourselves. In light of the new FTC Guidelines, however, we’ll be adding a new section to our reviews, titled “How did we get this book” in which we’ll formally disclose if the book was purchased by us, or solicited/received as an ARC/Review Copy, and if the latter from whom the book originated.

Also, you’ll notice a nifty new disclaimer on the bottom of our sidebar, and on our “About Us” and “Contact Us/Review Policy” pages:

“In accordance with the new FTC Guidelines for blogging and endorsements, The Book Smugglers would like everyone to know that while we do purchase our own books for review on occasion, you should assume that every book reviewed here at The Book Smugglers was provided to the reviewers by the publisher or the author for free unless specified otherwise.”

(This template was shamelessly copied from Jane of Dear Author)

Of course, we’ll be breaking down where we procured our books on a by-review basis with the new “How did we get this book” section.

That’s basically our professional, toned-down take on the matter and how we plan to proceed with the new FTC Guidelines in place as reviewers. That is not to say that we reacted in the same way to the news this morning:

Ana’s reaction:

I heard it first on Twitter. My first reaction, as our Twitter readers can attest to, was rather explosive and I managed to work myself up in a matter of seconds. Firstly, I felt completely furious at the idea of some unknown far away entity regulating the blog. Please bear in mind, I live in the UK and the first thing I thought was how exactly do they plan on regulating this? How does that apply to a blog that has one half in the US and one half in the UK? How do they propose to rule this?

Some of the books Thea receives in LA come from me, after I receive them from UK publishers: does that count? What constitutes “free”? We do get free books from publishers but more often that not, I have to pay for shipping. Further to that: how can they know? That is the point that boggles the mind: how would they know when someone is telling the truth whether a blogger bought a book or not? It expands to questioning about what exactly do they have in mind and how that does not infringe our own freedom.

I need to be very clear here though. It is not a matter of disclosing where I got a book (I always do that anyways) it is the thought of HAVING to do that, that does not sit well with me.

I got myself a headache I was so angry. Then Thea woke up and helped me cool down. And then I went and read this article from book review blogger, Edward Champion where he tells about a phone call with a representative of FTC and now I am utterly, completely furious all over again because the FTC rep makes assumptions of something he clearly does not understand! The nerve, the nerve!

Thea’s reaction:

I woke up this morning and logged on to the computer to meet a flurry of emails from Ana. That’s a pretty normal scenario. But, when I delved into the emails, I saw that Ana was totally, royally pissed off. And the culprit was not one of the usual suspects, but the dreaded Federal Trade Commission!

The horror!

After reading through tweets, press releases, and skimming a few super-dense official documents, I wrapped my mind around the FTC Revised Guidelines and was able to start calming Ana down a bit. My initial reaction was slightly indignant and PO’d, like Ana, but I also find the whole thing kind of humorous. This is what you get when an antiquated system attempts to keep up with a rapidly changing society of technology. Reading through the FTC official legalese and red tape, I came to the exact same conclusion as Ana: these old models of laws based on “compensation” and “endorsement” are simply NOT applicable to a lot of online media (such as blogging).

And then, there was the interview. I just finished reading this article from fellow book review blogger, Edward Champion. Edward relates a phone call he had with a representative from the FTC about these new guidelines and how they pertain to book review bloggers, and the huge gaping holes in the FTC’s arguments about the “compensation” angle for book review bloggers are big enough to drive a sixteen-wheel semi through.

For one thing, anyone that blogs knows that the whole blogging and reviewing process is a whole bunch of effort and cost with little tangible reward. Reading books, writing in-depth reviews of books, covering mailing costs for giveaways and promotional materials, not to mention day to day maintenance of a blog (including monetary costs of web hosting and domain purchasing, plus the time and effort cost of keeping things going day after day)…well, receiving “compensation” in the form of review/giveaway copies of books and having that be the constituting factor of payment is laughable. There’s a huge double standard – wherein (PAID!!!) reviewers of Newspapers and Magazines do not retain ownership of books and therefore are not seen as “compensation” by the FTC, versus (UNPAID!!!) bloggers who receive and retain review copies of books as individuals are seen as being “sponsored” by the publisher/author/publicist. The idea proposed by the obtuse fellow interviewed at the FTC to get around this compensation angle, that bloggers should send their review copies BACK after reviewing them, is even more laughable. (And by the way, Mr. FTC Drone, I also review books for a local print periodical, and I can tell you now that the newspaper certainly does not retain ownership of the book. Those books are mine now. And I’m pretty damn sure this is the case with other “professional” reviewers for magazines and periodicals that don’t fall under the “new media” umbrella.)

I’m not even going to expand on the FTC’s asinine view that reviewers who receive review copies of books do so with the understanding and expectation to write positive reviews for those books. (SERIOUSLY? If the world were made solely of happy fluffy reviews, what would be the point of critics? The FTC clearly hasn’t read Smart Bitches, or reviews like these. Our lifeblood, our CREDIBILITY rests on our ability to write honest – at times harsh and negative – reviews. And contrary to the FTC’s view, we don’t receive monetary compensation that would “buy” us off.)

I’ll say it again: the FTC’s approach to blogging is laughably antiquated and not applicable.

The economic model of compensation for advertisements and testimonials makes sense when you’re watching commercials for Tide or HydroxyCut or whatever (FTC DISCLAIMER: THE BOOK SMUGGLERS HAVE NO AFFILIATION WITH TIDE OR HYDROXYCUT OR ANY PARENT OR SUBSIDIARY COMPANIES THEREOF – are you happy Mr. FTC Drone? Are you?!), but does not hold water when it comes to bloggers. We are legitimate critics and members of the new media. We have our own code of ethics and online etiquette when it comes to reading and reviewing books, and the blogosphere has an ability to self-regulate that works pretty damn well. If reviewers are perceived of as “bought” by publishers and only publish positive, glowing reviews in return for free books and giveaways, or clog their pages with ads and promotions, they will be pushed out of the market. Their reputations will be marked, and no one in the blogging community will take them seriously – even to the point where readers may stop going to such blogs.

Not to mention as Ana so aptly puts it, HOW does the FTC plan on regulating the enormous (and international) blogosphere? Will The Book Smugglers, with its UK half, be subject to these regulations? I’m assuming that the FTC will deal with only the most egregious offenses (sort of like the Limewire/Napster situation) on a case-by-case basis, but in the age of social media where blogs die and new ones start up every day, Big Brother certainly will have his hands full.

We’ll play by the rules and put up our disclaimers, but it seems like repetitive, bureaucratic bullshit, and shouldn’t apply in the first place. We blog because we WANT to blog, because we LOVE to read and to write, and to share our love with other avid readers and writers. And as Ana says, the fact that we have to do this now is insulting.

We’re not exactly dealing with Bear Stearns or AIG here. Come on, government. Surely there are better places to worry about regulation.

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Bloggers and readers alike, please feel free to comment here if you have any questions, concerns, or if you just want a good laugh or rant.

The FTC Revised Guidelines are effective December 1, 2009. For more information, check the official press release HERE, or you can read the Guides in their entirety HERE.