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FCC to Probe TV Show Product Placements

Commission studies under-the-radar advertising

By Martin H. Bosworth
ConsumerAffairs.Com

June 27, 2008

Now the Federal Communications Commission (FCC) is considering rules on whether or not those product placements should be more clearly distinguished, as well as stronger warnings to viewers that the props or plot points may actually be paid advertisements.

The FCC yesterday released a combination "Notice of Inquiry" and "Notice of Proposed Rulemaking" on its investigation of how "embedded advertising" affects the content of broadcast television shows, particularly children's programming.

"As these techniques become increasingly prevalent, it is important that the sponsorship identification rules protect the public's right to know who is paying to air commercials or other program matter on broadcast television and radio and cable," the Commission said.

The FCC cited a study from PQ Media that claimed "between 1999 and 2004, the amount of money spent on television product placement increased an average of 21.5 percent per year." PQ Media estimated that the value of product placements for United States television broadcasts rose to $1.5 billion in 2005.

The report also cited changes in advertising to better attract viewers' attention, such as showing "serialized" commercials with storylines and integrated placement of products that flow from one 30-second spot to the next.

"As these techniques become increasingly prevalent, there is a growing concern that our sponsorship identification rules might fall short of their ultimate goal: to ensure that the public is able to identify both the commercial nature of any programming, as well as its source," said FCC chairman Kevin Martin. "I believe it is important for consumers to know when someone is trying to sell them something."

Commissioner Michael Copps agreed: "The fundamental premise of our sponsorship identification rules is that the American public is entitled to know who is trying to persuade them. That premise applies to a wide range of conduct, from payola to political advertising to product placement."

"This plotline brought to you by..."

Although product placement has not caused much controversy among television and movie viewers, writers and actors have been critical of rewriting scripts and changing lines to hawk everything from potato chips to cellphones. In a letter to Martin, Writers' Guild of America West president Patric Verrone said the role of product placements was to "subliminally advertise to viewers."

"When writers are told we must incorporate a commercial product into the storylines we have written, we cease to be creators," Verrone said. "Instead, we run the risk of alienating an audience that expects compelling television, not commercials."

The Writers' Guild had proposed to the FCC that television shows incorporate banners running real-time at the bottom of the screen notifying viewers of product placements or paid advertisements, but that idea was not included in the current FCC rulemaking notice.

Instead, the FCC is considering whether to make disclosures of paid advertising or sponsors of a show more prominent in the show's end credits, such as ensuring any credited advertisers are displayed for a specific amount of time to make them noticeable, and to create stronger disclosure rules for children's programming and cable television shows.

Ben Scott, policy director for media watchdog group Free Press, applauded the FCC's investigation but said they should reconsider the use of real-time advertising disclosures.

"Disclosing integrated ads on the screen at the time of their presentation gives viewers a clear understanding of what they are watching," Scott said. "In the age of TiVo, placing a disclosure during opening or closing credits simply does not properly inform consumers about how their favorite shows have been blended with commercials."

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