The U.S. Federal Trade Commission yesterday said that companies must disclose ties in word-of-mouth marketing campaigns. These fake grass-roots efforts -- dubbed "astroturfing" by critics -- hire people to endorse products as themselves, rather than as company representatives.
The FTC didn't announce any specific action or fines against this type of misleading marketing, although it may investigate campaigns on a case-by-case basis. The Washington Post covers the story.
Gamers see these sorts of campaigns all the time, from fake commentors who are actually paid marketers to the recent fake-PSP-fan weblog. While this kind of hidden corporate sponsorship makes us distrustful, we think better of companies, like Ubisoft, that disclose ties to its affiliates like the Frag Dolls. We most like the Major Nelson-type relationships, where a weblog spokesperson and a company are obviously linked.