Microsoft and EA Engaging in Deceptive Youtube Marketing Campaigns

Posted January 22nd, 2014 at 10:45 am


The biggest story in gaming right now is the controversy surrounding Microsoft targeting Youtube personalities to promote the Xbox One. What has really blown things up is the manner in which they have done so that violates FTC regulations by requiring any participating individuals to hide that they are being compensated for their opinion or endorsement. Now Electronic Arts has also made its way into the conversation with evidence they offered similar promotions where they would pay bonuses to those promoting their products. 

Yahoo has a good summary of the Microsoft situation which was initially reported on by Ars Technica. Essentially Microsoft, through Machinima, offered a campaign where partners could earn an extra $3 per thousand views by having videos that featured the Xbox One with recorded commentary mentioning it and any game being played by name. It was outlined that saying “anything negative or disparaging about Machinima, Xbox One, or any of its Games” would lead to disqualification from the additional revenue.

That in itself would not be all that controversial. Sure it’s sleazy but would not violate the law assuming the individuals made it clear that they were being compensated for what they were presenting. Yet the terms of the agreement stated that they “agree to keep confidential at all times all matters relating to this Agreement, including, without limitation, the Promotional Requirements, and the CPM Compensation”. That was different than past agreements for other companies that made it clear the individuals involved were required to disclose they were being paid for the video’s specific content.

FTC regulations were adjusted in 2009 largely due to “Mommy Bloggers” who were being gifted or paid by companies to promote products while misrepresenting themselves as unbiased consumers. “When there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement…such connection must be fully disclosed.”

The topic was already on the radar for an article but recent discoveries of EA being involved with similar tactics made it something worth addressing here. Recent campaigns have been offered for several games including Madden NFL 25, FIFA 14, and NHL 14 – all with much higher payouts than the Microsoft/Machinima deal. Madden at $15 per 1K views and FIFA and NHL at $10 made them enticing promotions to enter into. EA’s arrangement included that individuals “agree to keep confidential at all times all matters relating to this Agreement and any Assignment including, without limitation, the Details and Compensation”.

Youtubers are often thought of as uninfluenced independent voices. The majority are – whether earning revenue through Google Ads or a channel partnership – and unfortunately for them this will cloud the credibility of everyone on the platform. Any positive opinions about a video game (and especially Microsoft and EA products given the uproar) will now be met by increased questioning of motives whether justified or not.

There is nothing wrong with earning revenue through advertising but when it influences content and is presented in a way to mislead consumers that is where the line is crossed. Responsibility ultimately falls on the individuals who are required to disclose any possible conflicts of interest. However if the parties running the programs like Microsoft and EA require that they don’t to participate it’s still wrong but understandable why they chose not to. The FTC has only shown interest in going after corporations in cases such as these rather than the individuals even though they are running afoul of the law as well.