Will YouTube Case Lead To FTC Investigation Of Viacom's Questionable Marketing Practices?

from the be-careful-what-you-wish-for dept

Fri, Mar 19th 2010 10:55am — Mike Masnick

Here's one more point concerning the motions filed in the YouTube case by Google and Viacom. We had mentioned in our analysis that Google highlights the details of Viacom's rather large "stealth marketing" campaign to upload videos to YouTube, but Eric Goldman points out that the practices Google uncovered certainly sound like they cross the line of what the FTC says is legitimate:

YouTube also scored points for its descriptions of Viacom's stealth marketing practices. Although these facts only help YouTube's legal posture a little, the lawsuit's discovery process has unveiled some non-public information about Viacom’s practices that should be interesting to the FTC and state attorney generals. Viacom's alleged stealth marketing practices are aggressive--close to the permissible line, if not over it. As a result, they might be exactly the kind of consumer misdirection and inauthentic online content that the FTC has been railing against, and we know the FTC is looking for test cases in this area. So, a lawsuit that began as Viacom v. YouTube might morph into FTC v. Viacom. This is one of the known risks of picking a fight--once started, you can't control where it goes.

Indeed, Google presents rather detailed evidence of the lengths Viacom went through to fool users into thinking that clips were uploaded by people other than Viacom. Among Viacom's actions:

Hiring "an army of third-party marketing agents to upload clips on its behalf"
Having the uploads come from names that are made to look like random users
Using non-Viacom email addresses to sign up for accounts -- with the company admitting that it wanted to use email addresses that "can't be traced" back to the company.
Leaving Viacom offices to go elsewhere to do the uploads (such as Kinkos) to avoid connecting the uploads to Viacom.
Altering the footage of videos to make them appear unauthorized: "so users feel they have found something unique."

While certainly helping Google make the point that it's ridiculous to expect it to know which videos were legit and which were infringing, these also seem to certainly violate the spirit of the FTC's recent guidelines on questionable "stealth" marketing practices. As Goldman notes, if the FTC is looking for a high profile test case, they may have just been handed a ton of useful evidence.

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Filed Under: advertising, disclosure, stealth marketing
Companies: ftc, viacom, youtube

15 Comments

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Nastybutler77 (profile), 19 Mar 2010 @ 11:24am

Nice shot
Viacom was aiming at Google, but managed to shoot themselves in the foot. That's why large corporations shouldn't sue other large corporations. The lawyers on the other side are just as good, if not better than their own. Better to only sue small companies and individuals. Less chance you'll get pwned in court.
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Ima Fish (profile), 19 Mar 2010 @ 11:30am

First, I don't see what harm Viacom did by attempting to create viral videos. Is there even a single person anywhere who was harmed by this?

Second, there is no fricken way the FTC would ever go after the Viacom juggernaut. They'll find some little fish to fry.
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Ima Fish (profile), 19 Mar 2010 @ 11:33am

Re: Nice shot
People at Google have stated that Viacom filed the suit to gain bargaining power over Google. I doubt if Viacom had any intention to carry the case as long as it did, it probably assumed that Google would back down and come to the table and capitulate to whatever Viacom wanted.

It's now three years later and the only winners are the attorneys who are racking up huge fees doing nothing of value to anyone.
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:Lobo Santo (profile), 19 Mar 2010 @ 11:34am

Re: Nice shot
My ninja attorney can kill your lawyer in like 2 seconds...
And, I suspect Google has a team of (*open-source) ninja attorneys. Good luck to Viacom, they'll need it.
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Ryan, 19 Mar 2010 @ 11:38am

Re:
Agree with the first, not that rationalism is a strong suit of government agencies. On the second - why not? They've gone after/investigated Microsoft, Apple, and Google to name three. I don't see why they wouldn't go after Viacom as well.
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Hephaestus (profile), 19 Mar 2010 @ 11:47am

Here is a link to get the ball rolling ....
... any takers?

Google employees hanging out at a coffee shop or kinkos perhaps ;)

https://www.ftccomplaintassistant.gov/

Why: Your complaints can help us detect patterns of wrong-doing, and lead to investigations and prosecutions. The FTC enters all complaints it receives into Consumer Sentinel, a secure online database that is used by thousands of civil and criminal law enforcement authorities worldwide. The FTC does not resolve individual consumer complaints.
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Ima Fish (profile), 19 Mar 2010 @ 11:48am

Re: Re:
The FTC has went after Microsoft, Apple, and Google for falsely creating a grassroots viral video campaigns? I must have missed those stories.
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Hephaestus (profile), 19 Mar 2010 @ 11:59am

Re: Re: Nice shot
"People at Google have stated that Viacom filed the suit to gain bargaining power over Google."

bargaining by law suit ... Its what the media giants do to squash competition. They would be in so much better shape if they didnt.

Imagine napster selling music at 1 USD per song from day one.

Imagine all the other sites destroyed by EMIs "bargaining by lawsuit" still being around and selling their music.

Unintended Consequences, But for the want of a nail ...
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Mike Masnick (profile), 19 Mar 2010 @ 12:04pm

Re:
First, I don't see what harm Viacom did by attempting to create viral videos. Is there even a single person anywhere who was harmed by this?

The FTC guidelines are all about fooling people about the origin of a marketing campaign. Viacom did this, and did it on purpose.

Creating a viral video is different from disguising the origin of the video. That's what the FTC is concerned about.

Second, there is no fricken way the FTC would ever go after the Viacom juggernaut. They'll find some little fish to fry.

I'm not so sure. Getting Viacom would be a big publicity win for the FTC, and thanks to the lawsuit they have smoking gun emails without having to make any effort.
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BearGriz72 (profile), 19 Mar 2010 @ 12:40pm

Re: Here is a link to get the ball rolling ....
Hephaestus FTW! LOL
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bob, 19 Mar 2010 @ 1:55pm

Frogs
Viacom seems to have gotten a bit froggy with their attempts to get Google to pay them money. I hope it bites them right square in the ass.
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Anonymous Coward, 19 Mar 2010 @ 2:00pm

Re: Nice shot
I've had good experiences with suing small animals. You don't generally get much of a judgement, but you're more or less guaranteed the win.
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Richard (profile), 19 Mar 2010 @ 2:11pm

Oscar Wilde
could have warned them of the consequences...

http://www.law.umkc.edu/faculty/projects/ftrials/wilde/wildeaccount.html
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Anonymous Coward, 19 Mar 2010 @ 3:23pm

Re: Re:
The FTC guidelines are all about fooling people about the origin of a marketing campaign. Viacom did this, and did it on purpose.

Creating a viral video is different from disguising the origin of the video. That's what the FTC is concerned about.

Just because Viacom paid these people in some way, that doesn't mean that these people were influenced to post videos that they wouldn't have otherwise. So what's the problem? Do you think these people should have disclosed that they got something out of it from Viacom? Don't be ridiculous. That would be like expecting reviewers to disclose when they get "free" stuff for writing "reviews", and we all know how silly that would be.
/s
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Anonymous Coward, 19 Mar 2010 @ 7:57pm

"As Goldman notes, if the FTC is looking for a high profile test case, they may have just been handed a ton of useful evidence. "

It doesn't matter, the FTC would never go after the corrupt organizations/corporations that control it, just after honest people and entities. As such, Viacom has nothing to fear.
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