Jesse Hollington forwarded over a link and quick comments on something that we can only describe as “great news” for those of us who care about the integrity of product reviews generally, and on the Internet specifically. As I’m busy working on the 2010 Buyers’ Guide, I wanted to just post Jesse’s comments and add one or two of my own for the time being.

The link: FTC: Bloggers Must Disclose Payments For Reviews.

The summary: Effective December 1, 2009, the Federal Trade Commission requires bloggers to clearly note the freebies or payments they’ve received for reviewing companies’ products.

Jesse’s comments: “I realize it doesn’t affect us, and the fact that it doesn’t is in many ways a testament to the quality of our organization. It will be interesting to see how it affects certain other sites out there, however.”

My comments: Jesse’s correct. First, iLounge isn’t a blog. Second, we’ve never taken a payment or a freebie in exchange for writing a review. Third, we are thrilled to see the FTC working on behalf of consumers to create transparency in product coverage, which has been plagued by tons of faked/compensated reviews over the last five or so years.

iLounge has a unique operating structure that was designed to avoid the exact sorts of problems that the FTC is focusing on. Our publisher owns iLounge outright, but does not write product reviews; by contrast, our editors and reviewers have no ownership stake in the company or site. The editorial side of iLounge covers whatever is purchased by or sent to iLounge that we feel is worthy of coverage, but as editors, we do not own anything that is acquired by the organization. Additionally, iLounge has never sold items received for coverage, or traded them for other items. iLounge even purchases all the iPods and iPhones we review—a substantial expense given how many we buy every year (10 iPod nanos? Sure, why not?), and a major differentiator from publications that receive items directly from Apple.

As you may or may not already know, this is different from many publications—online and print—where the person who owns the publication is also reviewing products. Some publications explicitly expect payments in exchange for coverage. Others only review products that they are sent, and then with the expectation that they will be able to keep or sell the items afterwards for cash. In our experience, these practices lead to obvious reviewer biases in favor of that which is heavily compensated for, or merely expensive; this is part of the reason you see so many “sure, it’s overpriced, but I love it!” reviews out there. Our long-standing distaste for compensated editorial—essentially, “advertorial”—is why we do not work this way.

So the FTC’s decision to require reviewer compensation disclosures is very, very good news for consumers as a whole. We applaud it, and want you to rest assured that our reviews are not and have never been paid for by the companies we cover. That’s a point of pride around here, and as Jesse says, it will be interesting to see how others address (or fail to address) the topic.

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“The FTC’s decision to require reviewer compensation disclosures is very, very good news for consumers”

Strongly disagree. It’s a violation of property rights and free speech. This ruling should be fought. Hard.

By Mark Wickens on 10.07.09 at 11:25 AM

Uh, how? Please elaborate. In detail.

By Jeremy Horwitz on 10.07.09 at 11:51 AM

I think this is overall a win for the consumer. I’m sick of Corporations (of any kind) being treated as if they are a human with rights. In the end, the government exists FOR THE PEOPLE.

This FTC decision helps a consumer judge the content more thoroughly, and that’s a plus.

By Josh on 10.08.09 at 05:22 AM

@Mark Wickens
We can see your one of the compensated guys and for sure your reviews are heavily biased.

After December 2009, you will need to find another job to generate cash. Now your getting desperate and I feel good about it.

By EGY99 on 10.08.09 at 09:41 AM

I see my comment with a link to explaining why the FTC ruling is bad has been deleted, while a personal (and false) attack on me remains.

The short answer to why the ruling needs to be fought is this: “Congress shall make no law … abridging the freedom of speech, or of the press.” No law. The government has no role in protecting us from what it decides is potential bias. The principle behind this ruling paves the way for laws requiring journalists to disclose party affiliation, religion, income, educational background, race, etc. After all, these all could affect how a news story is skewed, could they not? How can I trust a story on abortion when I don’t know whether the writer is a Catholic or not? Of course, the answer is I need to be responsible for myself. I need to look at the facts presented, compare it to what else I know and what other people are writing. In short, I need to think for myself, not call on the government to “protect” me by prescribing conditions under which others may provide their news, analysis, and opinions.

By Mark Wickens on 10.08.09 at 06:26 PM

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