FTC Settles with Reverb over iTunes Reviews
Reverb Communications settled a compliant with the Federal Trade Commission in which the agency accused the public-relations firm of having employees post reviews of video games on Apple's iTunes store.
Reverb, located in Twain Harte, California, represents a number of clients in the video-game industry, such as MTV Games, Ignition Entertainment, and Demiurge Studios. A release from the FTC said that the agency engaged in "deceptive advertising by having employees pose as ordinary consumers posting game reviews at the online iTunes store and not disclosing that the reviews came from paid employees working on behalf of the developers." The FTC alleges these activities occurred between November 2008 and May 2009.
Under the proposed settlement, Reverb is required to remove the reviews in question and bars Reverb and Snitker from making such comments in the future without disclosing their any relevant connections to the seller of the product or service. (See also User Reviews: How to Use Them, and How Not To.")
When asked if her company disputes the FTC's allegations, Reverb Communications Vice President of Public Relations and Founder Tracie Snitker says, "We settled. We do [deny the allegations in the compliant]. That was the whole point. We agreed to disagree."
Stacy Ferguson of the Bureau of Consumer Protection at the FTC has yet to return a phone call for comment.
The case stems from the FTC's revised endorsements and testimonials guides issues in 2009. The agency specified that "the online post by a person connected to the seller, or someone who receives cash or in-kind payment to review a product or service, should disclose the material connection the reviewer shares with the seller of the product or service. This applies to employees of both the seller and the seller's advertising agency."
Disagreement over facts and the costs of fighting the case are the reasons why Reverb settled, Snitker said, referring to a previously released written statement. "During our discussions with the FTC, it became apparent that we would never agree on the facts of the situation, " Snitker said in the statement. "Rather than continuing to spend time and money arguing, and laying off employees to fight what we believed was a frivolous matter, we settled this case and ended the discussion because as the FTC states: 'The consent agreement is for settlements purposes only and does not constitute admission by the responds of a law violation.'"
Evolution PR Director Tom Ohle, who's represented video-game companies since 2001 and whose current clients include Paradox Interactive, CD Projekt Red, Good Old Games, and Empire Avenue, is an advocate of proper ethics for marketing and public relations, writing about such issues on his company's blog.
"Any PR firm that is pitching the ability to secure great reviews for someone is a bit sketchy," Ohle says. "Ultimately, there is a line that you cross in PR, and trying to pretend to be real users with opinions is not a good thing to do. Ultimately, you need to let a product speak for itself."
GamePro Media also asked public-relations agency Sandbox Strategies for comment, but they were not able to provide one.
Snitker worries that the revised FTC guidelines could have a chilling effect on the speech of people who work in the industry. "It's personal vs. private, right?" Snitker says. "People are making that distinction. We all have our personal lives. It's a fine line. I don't dictate to my employees on what they can do and can't do. The FTC is telling me that I have to."
Ohle says if you're upfront about who you are and what you represent, it shouldn't be a problem.
"Ultimately, if being honest about the way you're representing opinions online, I don't see much of a problem. It depends on how far FTC was going to take it, " Ohle says. "It depends on how much you have to disclose. If I have to attach 'I'm working on this game,' so be it."