The Net Neutrality Furor

PaidContent.org has a useful summary of the furor from the left and the right over the FCC's recent decision on "net neutrality." That is the idea that internet service providers must not show preferences to certain websites by degrading or sling down other websites. Some critics are angry that the FCC passed a ruling of this sort at all. Other critics of the ruling say it didn't go far enough to protect internet competition and the rights of consumers.

See Joe Mullin, "FCC Pushes Through Net Neutrality—And Draws Fire From Right And Left," PaidContent.org, December 21, 2010.

The FTC's Rebuke of a PR Agency

The Federal Trade Commission recently issued its first rebuke under new guidelines that prohibit "social media" and "word of mouth" marketers from passing themselves off as ordinary consumers touting a product and that require endorsers to make clear when they have financial connections to sellers. The FTC found that PR agency Reverb had engaged in this sort of "deceptive advertising" by having employees pose as ordinary citizens while posting game reviews online and not disclosing that the reviews came from paid employees working on behalf of the game developers.

"Word of Mouth" executive Ed Keller works through some of the ramifications of this decision in a thoughtful essay.

See Ed Keller, "FTC to Social Marketers: Keep It Real or We'll Take Action," MediaBizBloggers, September 1, 2010.

China Says No to Film Ratings

China's top movie-industry regulator, the State Administration of Radio, Film and Television, has put a lid on the notion of a film classification system. A spokesman said that the government believes such a system is "inappropriate."

At present, censorship is the pathe used to decide about the release of films. "[F]lmmakers in China believe that if the censor's scissors were replaced with a reliable ratings system, helmers and producers could take more risks with content and story. The censorship process also takes a long time, meaning there can often be a hiatus between a pic's international bow and its Chinese preem, giving pirates ample time to flood the market with good DVD copies of the movie for impatient filmgoers."

From Clifford Coonan, "China Says No to Film Ratings," Variety, August 23, 2010.

Are Ringtones a Public Performance?

A finding that consumers infringe the public performance right each time their phones ring in public threatens to stigmatize millions of consumers as lawbreakers.

- Digital rights organizations Electronic Frontier Foundation, Center for Democracy & Technology and Public Knowledge

In Wendy Davis, "ASCAP Strikes Sour Chord With Consumer Advocates," Online Media Daily, July 6, 2009


The Electronic Frontier Foundation, Center for Democracy & Technology and Public Knowledge have together filed papers asking a Federal district court in New York City to rule against the American Society of Composers and Publishers (ASCAP). ASCAP was founded in 1914 to collect money--"licensing fees"--for its members whose copyrighted musical compositions are performed in public, including on radio and in theaters. In recent years, ASCAP has taken the initiative to collect licensing fees in digital media such as the internet. Now the organization is arguing that it is entitled to licensing fees for ringtones because, it says, the playing of ringtones is a "public performance." It wants AT&T to pay the fee for the ringtones it sells to its customers.

The Electronic Frontier Foundation, Center for Democracy & Technology and Public Knowledge reject ASCAP's argument about the public nature of a mobile phone's ring, comparing it to a person playing a CD in a car with the window down. The group notes too, that if the court forces AT&T to pay, the charges will be extended to consumers.

The Struggle Over Kids, Mobile Devices, and Regulation

Kids are usually more facile and fearless with technology than their parents -- quick to click first and ask questions later. A mobile phone that gives them easy access to content and purchasing power makes them easy prey for aggressive marketers.

-Jonathan Liebowitz, Federal Trade Commissioner

Speaking at the start of a two-day FTC forum on mobile devices, Liebowitz said the FTC intends to take enforcement action agtainst deceptive or unfair content offers. "As an example, Mr. Leibowitz pointed to SMS text-messaging offers from marketers that do not clearly disclose the costs for using the service." Activists are pushing for regulations to put companies on notice that mobile devices will not be vehicles for fraud. By contrast, marketing and media executives seem to be worried that, as with other media, specific concern about children might be merely the easiest way to legitimate regulation of advertising on mobile devices. They argue that the FTC should hold off from any rules until it is clear that problems are emerging. "The mobile market is finally becoming a platform for commercial services," they say, and regulations will hinder its development.

In Ira Teinowitz, "FTC on Watch Against Wireless Ripoffs," Advertising Age, May 7, 2008

Advocates Urge FTC to Take Proactive Stance on Mobile Marketing

Privacy advocates are concerned that it could be misused. It's the 'Minority Report' paranoia.

-D. Reed Freeman, a partner with the law firm Kelley Drye & Warren and a former staff attorney in the FTC's Bureau of Consumer Protection

He was referring to a complaint that the Center for Digital Democracy and the U.S. Public Interest Research Group filed with the Federal Trade Commission. The purpose of the complaint is to force the FTC to begin to set rules about how much and how marketers can track people's actions on their cell phones and other mobile devices. Of course, the advocacy groups would disagree that their actions are paranoia. "We're filing a complaint to force the FTC to take a proactive stance," said Jeff Chester, executive direct of the Center for Digital Democracy. He noted that mobile ad companies "incorporate the same problematic business practices that we witnessed with PC-based broadband marketing, including behavioral targeting and profiling techniques--except that this time they know your location."

In Wendy Davis, "Groups Complain To FTC About Mobile Marketing," Online Media Daily, May 6, 2008.

It might be added that, contrary to Freeman's statement, the marketing activities in Minority Report are treated rather gently, even humorously, compared to the government surveillance in the movie. Steven Spielberg, the director, was using the marketing scenes to provide product placement for The Gap and other firms.