FCC seeks to change regulation of corporate interests disclosures on TV news

January 3, 2012

TV newscasts are increasingly seeded with corporate advertising masquerading as news — and the federal government wants to do something about it.

Concerned that subtle “pay-for-play” marketing ploys are seeping into the news, the Federal Communications Commission has proposed a regulation that would require the nation’s 1,500 commercial TV stations to disclose online the corporate interests behind the news.

The proposal, which could take months to be enacted, has drawn praise from media watchdogs and consumer groups that have criticized the current system, which requires broadcasters to disclose that an advertiser paid for a mention on the news only in the closing credits of a broadcast.

“Unless you stick around for the end credits, you’re unlikely to know it’s payola,” said Corie Wright, senior policy counsel for Free Press, a media watchdog group backing the FCC proposal. “If broadcasters were required to put it online, you could check to see if it was actually sponsored or not.”

The proposed regulation is aimed at news programs that appear to viewers to be the work of independent journalists, but in fact sponsors have shaped or even dictated the coverage.


Tony Perkins listens to Alison Rhodes, the self-styled “Safety Mom,” talk up products during a segment on WTTG/channel 5’s morning news last year. (myfoxdc.com)

A common form of advertiser-supplied content, documented in a recent Washington Post article, is a live interview segment in which a seemingly neutral reviewer recommends a series of products that the “reviewer” has been paid by sponsors to mention. Stations across the country have also brokered “exclusive” relationships with local hospitals in which the hospitals pay the station to be featured in health stories. Other stations have aired “news” programs that feature interviews with sponsors who’ve paid for the privilege.

According to an FCC report, many stations also use “video news releases,” footage produced by a sponsor or corporate interest that looks like it was shot by the station.

Under current law, such arrangements aren’t illegal, but radio and TV broadcasters are required to tell viewers and listeners on-air whenever a company has paid for involvement in a news segment. The law, which carries penalties of up to $10,000 for nondisclosure, grew out of the “payola” scandals of the 1950s, when record companies regularly paid radio DJs to influence playlists.

It’s unclear just how widespread such “plugola” schemes are now. But an FCC report, published in June, cited a 2010 Pew survey in which 24 percent of local TV news executives reported “a blurring of lines between advertising and news.”

The FCC report led the agency to propose that stations disclose these arrangements in a public file maintained online by the FCC. Broadcasters and interested groups began filing comments about the idea during the past two weeks.

In practice, there is little agreement on what constitutes adequate on-air disclosure of advertiser involvement in the news. Some stations ignore the rarely enforced statute, and others simply include a mention of sponsor input during the closing credits of a newscast or morning news-discussion program.

Broadcasters, including the Post-Newsweek group of stations owned by The Washington Post Co., have suggested that the proposed regulations could create other problems.

The National Association of Broadcasters is concerned about “the cost and manpower burden” that a new regulation could impose on stations, said Dennis Wharton, its spokesman. The trade association advocates forming “a working group” to study the issue.

One group of educational and religious broadcasters said in its FCC comments that the agency should not require stations to tell its viewers that the station has a public FCC file. “Such announcements may arouse the public’s interest in examining a [public inspection file], but the [stations] do not believe that the Commission should attempt to stimulate such examinations,” wrote the group, which included Prime Time Christian Broadcasting, Bowling Green State University and Southern Illinois University.

Proponents, however, point out that stations are required to disclose this information on-air, so placing it online in a public file at the FCC would impose little additional cost.

Putting the data online would be useful to “journalists, citizen groups, and competitors,” who could use it to “create consumer-friendly information sources and reports,” wrote Steven Waldman, the author of the June FCC report, in a commentary last week in the Columbia Journalism Review.

The Radio Television Digital News Association, which represents TV news journalists, said it has taken no position on the proposed regulation but continues to advocate greater transparency among its members.

“The time and place to inform the viewer [about sponsor connections] would be at the time something airs, not at the end of the show,” said Mike Cavender, the group’s executive director. “That is the best and most appropriate disclosure. . . . We make an assumption, and I suppose many viewers do, that something they see on a newscast is produced by the news organization they’re watching. If it’s not, then simply tell the viewer or listener when it’s on the air.”

Paul Farhi is The Washington Post's media reporter.
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