December 31st, 2003
Product-placement complaint fails to result in new rules
Wall Street Journal
The Federal Trade Commission doesn’t think more rules are needed for the fast-growing
marketing technique of product placement, according to a letter sent to Commercial
Alert, a Portland, Ore., watchdog group. The group filed a petition with the
FTC last year asking it to investigate the practice. Commercial Alert, founded
by consumer activist Ralph Nader, also asked the FTC to set up guidelines that
would require television broadcasters to adequately disclose the placements.
In the letter to Commercial Alert, the FTC said there is little evidence that
the marketing practice misleads or confuses consumers. While the FTC said it
believes there are instances in which the line between advertising and programming
might be blurred, it said its "existing statutory and regulatory framework
provides sufficient tools for challenging any such deceptive act or practices."
"The FTC has basically endorsed this epidemic, so now we are asking members
of Congress to introduce and pass legislation that requires marketers to disclose
product placement in movies, TV programs, videogames and books," says Gary
Ruskin, executive director of Commercial Alert. "As embedded advertising
takes over all these media, we think congressional action is inevitable."