The FCC takes a closer look at product placement on TV

Use of product placement and integration has surged in recent years, due in part to consumers' ability to skip commercials. Now, the Federal Communications Commission is considering whether it should implement new regulations for the disclosure of product placement in TV shows. Currently, disclosure is only required at the end of the show, but the regulations might change to ensure viewers are able to identify the commercial nature of the programming.

In the news
Use of product placement and integration has surged in recent years, due in part to consumers' ability to skip commercials. Now, the Federal Communications Commission is considering whether it should implement new regulations for the disclosure of product placement in TV shows. Currently, disclosure is only required at the end of the show, but the regulations might change to ensure viewers are able to identify the commercial nature of the programming.

FCC spokesman Clyde Ensslin told PRWeek that agency chairman Kevin Martin circulated a notice among the commissioners to get their opinions on a stricter set of regulations, but a formal vote date hasn't been set. No other details on the regulations are available, including whether they will strictly apply to paid placements, or unpaid ones, too.

Why does it matter?
PR firms are increasingly brokering product integration and paid and unpaid product placement deals for their clients.

Andy Marks, MD at Matter, an Edelman company, believes if new regulations are set, it should be done so that the product placement and the disclosure don't distract from the entertainment value.

"It's important to [respect] the viewing experience," he says, "and not be so obtrusive with mentions or disclosures that it takes the experience down a notch or insults [viewers'] intelligence."

Greg Eppich, VP at Publicis Consultants, says it's hard to say how disclosure will affect brand perception, but he doesn't think stricter regulations will be a deterrent, especially in non-paid placements.

"One could say [more disclosure] would drive additional awareness for the brand," he adds. "But it's yet to be determined how that might affect perception of a given brand."

Five facts:
1. A study by Media Planning Group found 90% of people with DVRs don't watch commercials in recorded programming, USA Today reports.

2. Spending on paid product placements in the US in 2007 increased 33.7% from the previous year, according to PQ Media.

3. The top categories of product placement on TV in Q1 2008 are soft drinks, apparel, fitness centers, football teams, and exercise equipment, Nielsen reports.

4. In the first three months of '08, product placement was up 6% on prime-time shows for the 11 measured networks on broadcast and cable TV, according to Nielsen.

5. In the first three months of '08, there were 3,291 occurrences of product placements on American Idol, according to Nielsen data.

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