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FCC Starts Rulemaking on Embedded Ads - TvTechnology

FCC Starts Rulemaking on Embedded Ads

According to studies cited by the FCC in the NPRM, the amount of money spent on television product placement increased an average of 21.5 percent per year between 1999 and 2004.
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The FCC Thursday began the process to make new rules regarding sponsorship identification and embedded ads, potentially increasing its regulation of the way broadcasters and content producers get the ad dollars.

“Due, in part, to recent technological changes that allow consumers to more readily bypass commercial content, content providers may be turning to more subtle and sophisticated means of incorporating commercial messages into traditional programming,” the FCC said in its notice of proposed rulemaking. “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.”

According to studies cited by the FCC in the NPRM, the amount of money spent on television product placement increased an average of 21.5 percent per year between 1999 and 2004.

The FCC also cited some actions by major media players. The CW network offers “content wraps,” serialized stories within a group of commercials that include product integration, and “cwikies,” five second advertising slots interspersed in regular programming, the FCC said.

Fox Sports Network claims a specialty in “product immersion,” the practice of “immersing products into programs … so that they really feel like it is part of the show,” according to the FCC, and NBC brings in advertisers during programming development. “The goal of many of these new marketing techniques is to integrate products and services seamlessly into traditional programming,” the FCC said.

The FCC said it is following provisions of the Communications Act that provides for the public’s right to know the identity of broadcast sponsors. The Children’s Television Act has additional rules on children’s programming.

Democratic Commissioners Michael J. Copps and Jonathan S. Adelstein said the issue should have been addressed before now.

“‘Reality TV’ should mean informing viewers about who is secretly pitching to them in the TV shows they are watching,” Adelstein said. “The true reality is that news and entertainment alike are practically being turned into undisclosed commercials.”

Comments are due 60 days after the NPRM appears in the Federal Register, with reply comments due 30 days after that.