Warner Bros. was recently found guilty of paying PewDiePie and other famous YouTubers to render positive reviews of their games.
On July 11, 2016, the Federal Trade Commission reached a settlement with Warner Bros. over allegations that it inadequately disclosed payment to PewDiePie, among others, to give positive reviews of one of its video games, "Middle Earth: Shadow of Mordor." According to the FTC charge, Warner Bros. deceived customers by paying thousands of dollars to social media stars like PewDiePie.
The Verge noted that in the terms of agreement, Warner Bros. is prohibited from not disclosing similar deals in the future. The company further cannot pretend that sponsored videos and articles are made by independent producers.
The deal with PewDiePie and others required them to make at least one post on Facebook or Twitter about "Middle Earth," and videos without any negative remarks. PewDiePie and others were advised to present the sponsored status of the video in the "Show More" section, although some of them failed to do so.
The FTC stated that doing so would not have fixed the issue, since the disclaimer would not be seen on videos watched via other social media platforms.
ArsTechnica cited that furthermore,PewDiePie the paid critics were prohibited from revealing any game bug or glitch and should include a strong verbal call-to-action to click the link in the description box to lead the viewer to the game website and learn more about it.
The viewers of PewDiePie should be compelled to get more details about "Middle Earth," register and learn how to play it.
PewDiePie has over 47 million YouTube followers. Out of the 5.5 million views generated by all the videos created by the paid YouTubers, PewDiePie contributed 3.7 million on his own.
Jessica Rich, director of the FTC's Bureau of Consumer Protection, stated that consumers have the right to know if reviewers like PewDiePie are giving their own opinions or rendering paid sales pitches. Companies like WB have to be direct with consumers in their online ad campaigns.
Since 2015, the FTC has actively been monitoring native advertising and endorsements made online by personalities like PewDiePie, with the objective of identifying deceptive marketing campaigns where social media influencers fail to disclose a financial relationship with the product that they are giving reviews of.
In the past months, the FTC successfully identified various influencers and companies and found them guilty.
PewDiePie and Warner Bros. were criticized for their recent offense but the FTC may mete out a harsher penalty next time. More updates and details are expected soon.