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Warner Bros. And Influencers Failed To Properly Disclose Shadow Of Mordor Sponsorships

by Mike Futter on Jul 11, 2016 at 06:50 AM

The Federal Trade Commission (FTC) has announced a settlement with Warner Bros. regarding the publisher’s failure to ensure proper disclosure related to Middle-earth: Shadow of Mordor videos. The publisher worked with a number of high-profile influencers, including Felix Kjellberg (Pewdiepie) during the campaign.

According to the FTC, the sponsored videos were viewed more than 5.5 million times and promoted across a number of social networks. The paid-for video content agreement specified that influencers on YouTube were only allowed to speak positively and were not allowed to acknowledge bugs and glitches they found while playing. Payments for the videos ranged from hundreds to thousands of dollars.   

Warner Bros. is accused of not ensuring that paid influencers disclosed the sponsorships “clearly and conspicuously.” The complaint goes so far as to assert that Warner Bros. told content creators to place the disclosures “below the fold” such that they could only be seen if the full video description was manually expanded.

The publisher also did not ensure that disclosure was present in the content of the video. Some of those paid to promote the game only mentioned they received it early, and did not disclose the financial relationship at all.

Videos were only posted after Warner Bros. pre-approval. The FTC says that the publisher also approved at least one video that failed basic sponsorship disclosure rules.

Warner Bros. won’t be paying a fine this time. The company only needs to ensure that it doesn’t misrepresent relationships in the future. Additionally, the company must engage in education efforts with influencers it hires to ensure that they understand how to properly disclose. Warner must also withhold payment from those that fail to comply.

Should Warner Bros. violate the FTC’s order, it would be subject to civil penalty. "Warner Bros. Home Entertainment always strives to be transparent with our customers and fans when working with social influencers, and we are committed to complying with the related FTC guidelines," a company representative told us via email.

The FTC’s comments here have direct bearing on another recent matter. Last week, two popular YouTubers were found to be owners of a Coutner-Strike: Global Offensive (CS:GO) gambling site. At the time they failed to disclose the financial relationship and lied in their videos about their role with the company. Later, they updated the descriptions of their videos, placing new disclosures below the fold.

Update: A statement from Warner Bros. has been added above.

[Source: FTC]

 

Our Take
This is essentially a warning that specifies compliance rules. Warner Bros. and its paid influencers got off lightly here. Should the publisher pay influencers for more advertisements and fail to disclose, there will likely be heavy penalties.