Industry Fires Back, Defends Placements

WASHINGTON, D.C. An ad industry coalition sent a letter to the Federal Communications Commission and the Federal Trade Commission on Wednesday, urging the regulators to reject a petition by consumer watchdog group Commercial Alert calling on TV networks to disclose product placements in their shows.

The Freedom to Advertise Coalition, which includes the American Advertising Federation, the American Association of Advertising Agencies and the Association of National Advertisers, among others, argues that interrupting programs to disclose placements “borders on the ludicrous” and will make TV “virtually unwatchable,” according to coalition lawyer Darryl Nirenberg.

The letter calls the petition by Commercial Alert, co-founded by consumer advocate Ralph Nader, a violation of commercial free speech that will establish a dangerous precedent. The proposals from Commercial Alert “pose a threat to artistic freedom — traditionally the ‘front line’ in the protection of our Constitutional rights. They seek to extinguish the free speech rights of those who wish to communicate via these means,” according to the letter. Commercial Alert called on regulators to require networks to clearly identify all product placements [Adweek Online, Oct. 6].

Product placement can also be an essential ingredient in a program’s storyline, the coalition said. “Carrie Bradshaw, in the HBO series Sex and the City, encapsulates a certain stylish type of New York woman when she buys Monolo Blahnik and Jimmy Choo shoes,” the letter said.

Commercial Alert executive director Gary Ruskin has argued that his group’s petition follows the same lines pursued by his group in a 2001 complaint that led the FTC to warn Internet search engines about including undisclosed ad messages in search results. The FTC’s Bureau of Consumer Protection did not recommend formal action, but warned search engines about “the need for clear and conspicuous disclosures of the paid placement.”

Separately, the 4A’s has joined with the Association of National Advertisers and the Direct Marketing Association to published an open letter in today’s Roll Call newspaper urging Congress to pass national anti-spam legislation designed to regulate unwanted commercial e-mail.

The letter addressed to the 108th Congress calls for the passage of the CAN-SPAM Act (S. 877) or the Reduction in Distribution of Spam Act (H.R. 2214). The former bill, which proposes a “Do-Not-Spam” registry (similar to the national Do-Not-Call list intended to shield consumers from unwanted telemarketing solicitations) was approved by the Senate in late October. The latter continues to be bogged down in the House of Representatives.

—with Ann M. Mack