FTC takes WB to task for failing to disclose sponsored Shadow of Mordor vids

Warner Bros. has agreed to a settlement with the Federal Trade Commission over charges that the publisher failed to ensure adequate disclosure of the fact that it paid several YouTubers for positive coverage of 2014's Middle-earth: Shadow of Mordor.

We've long known that Warner Bros. engaged in some questionable YouTuber-centric marketing tactics for Shadow of Mordor via a hired marketing firm, Plaid Social. The fact that the Feds stepped in to file a complaint and investigate is notable because it affords game makers a chance to study where WB went wrong -- and what price they'll pay.

The original complaint alleged that Plaid Social's hiring of multiple notable "influencers", including YouTubers like PewDiePie, to publish positive videos and social media posts about Shadow of Mordor, did not stand up to the FTC's strict disclosure guidelines.

Even though Plaid Social did tell the YouTubers it hired to disclose the fact that they had been paid hundreds or thousands of dollars to make these videos, many of those YouTubers did so in a manner that the FTC says is not adequate -- by, say, only including a written disclosure in the description field of their published video, far down enough that viewers would have to click "Show More" in order to read the disclosure. 

"The vast majority of YouTube influencers did not include any sponsorship disclosure in their videos and only placed their sponsorship disclosures 'below the fold' in the description box below the video," reads an excerpt of the complaint. "As a result, consumers who watched these YouTube videos were unlikely to learn that the videos were paid promotion."

When Gamasutra spoke with an FTC representative about this back in 2014, we learned that the FTC believes that "disclosure should be clear and conspicuous....it should basically be unavoidable by the viewer."

Moreover, since the Shadow of Mordor contracts with these YouTubers required them to submit their videos to Plaid Social for pre-approval before they could post them, the FTC says Plaid Social (and, by extension, Warner Bros.) bears full responsibility for their failures to disclose.

Now, Warner Bros. has agreed to settle the FTC's charges and, in return, it will operate under a new FTC order that basically requires it to keep its nose clean for the foreseeable future.

Among other things, the order (which will be open to public comment for 30 days before it's made final, at which point it carries the weight of law) prohibits Warner Bros. from "misrepresenting that any gameplay videos disseminated as part of a mareting campaign are independent opinions or the experiences of impartial game enthusiasts." 

Moreover, the order lays out a clear set of requirements Warner Bros. must abide by when it or anyone it hires conducts a marketing campaign that uses YouTubers or other "influencers." These include clearly instructing influencers about how to properly disclose the fact they're taking part in a promotional campaign, monitoring them for compliance and revoking payment if they fail to comply.

It's a bit similar to the settlement the FTC and YouTuber network Machinima reached last year, after the FTC alleged Machinima had "deceived consumers" by failing to disclose that it had paid "influencers" to publish videos endorsing Microsoft's Xbox One. Under the terms of that settlement, Machinima was prohibited from such behavior and was required to ensure that all sponsored content produced under its aegis was adequately disclosed as such.

Incidentally, at least one of the YouTubers named in Machinima's settlement with the FTC, Tom "Syndicate" Cassell, was recently taken to task for publishing videos promoting a Counter-Strike: GO gambling website without disclosing that he was an owner of said site.