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Blogging for dollars raises questions of online ethics

Blogger Colleen Caldwell rants and riffs about whatever strikes her fancy — a run-in with her child's school principal, the rising price of Girl Scout thin mints, an upcoming movie that caught her eye.

"Has anyone out there read a book called 'The Ultimate Gift'? I just heard that a movie is being made of the book (which sold 4 million copies)," she wrote in a recent post on her site, Simple Kind of Life.

The 30-year-old software analyst from Brooksville, Fla., went on to praise the inspirational message of the Fox Faith film, which opens today, about a trust fund baby who discovers the joy of giving. Caldwell noted that each member of the opening-weekend audience was being allowed to direct a dollar of the ticket price to a charity of the filmgoer's choice.

One thing Caldwell didn't mention: She was paid $12 to build buzz about the movie's opening and the charitable campaign — bringing her blogging-for-dollars take to more than $7,700.

Thousands of bloggers are writing sponsored posts touting such diverse topics as diamonds, digital cameras and drug clinics. The bloggers are spurred by new marketing middlemen such as PayPerPost Inc. that connect advertisers with mom-and-pop webmasters.

Some of their fellow bloggers are critical, saying the industry is polluting the blog world and misleading consumers by blurring the line between advertising and unbiased opinion.

"The problem is the advertisers are trying to buy a blogger's voice, and once they've bought it they own it," said Jeff Jarvis, a City University of New York journalism professor who writes about technology at BuzzMachine.com.

"PayPerPost versus authentic blogging is like comparing prostitution with making love to someone you care for deeply. No one with any level of ethics would get involved with these clowns," said Jason McCabe Calacanis, an entrepreneur who co-founded Weblogs Inc., a network of blogs that includes popular technology site Engadget.

The bloggers who take assignments from the likes of PayPerPost, ReviewMe, Loud Launch and SponsoredReviews.com call the hubbub overblown. They say the services provide a way to make a profit or keep their blogs going. Technorati, a search engine that tracks 71 million blogs, says 175,000 are created daily.

Posties, as PayPerPost calls its crew of 15,500 bloggers, say their posts are sincere, sponsored or not, and that financial incentives are disclosed.

"I would never make up a lie," Caldwell said. "My sister reads my blog and she would call me out."

She has earned $7,743.54 since signing up in July, shortly after the Orlando, Fla.-based marketing firm was launched, by promoting such things as wireless outdoor speakers and online coupon sites. The part-time job has helped her pay for a wall-mounted TV, dishes and a family ski trip.

Caldwell's traffic has doubled thanks partly to PayPerPost's fanatical users, who link often to fellow Posties. That gives her a bigger audience for her unpaid musings on topics including a recent dream about Rainn Wilson, the actor who plays Dwight in NBC's sitcom "The Office."

"People talk about how we're destroying the credibility of the Internet," Caldwell said. "Let me tell you — there are a lot worse things happening online."

Even so, the Federal Trade Commission has cautioned that word-of-mouth marketing sponsorships must be clearly disclosed.

Like many Posties, Caldwell typically relies on a blue disclaimer button on her home page that, when clicked, informs readers that compensation from marketers "may influence" the entries on her blog, and that posts "may not always be identified as paid or sponsored content."

PayPerPost urges the bloggers it works with to use a personal touch as long as they cover the topic, meet the required word count and provide links. Bloggers scan offers — usually in the $5-to-$20 range but sometimes as high as $1,000 — and, if their site qualifies, sign up and then write about the product or service. Afterward, they collect the fee.

Laura Neiman, 33, a Denver mother of five whose blog is called LaLa Girl, wrote wistfully about a Caribbean yacht charter service.

"We don't get a whole lot of opportunity to sail the open seas in landlocked Colorado, so I really can't relate to this at all," she began, "but I keep reading about the popularity of yacht charters as an alternative to a 'regular' vacation."

Derek Cisler, 32, a corporate trainer in Dardenne Prairie, Mo., often weighs in on NASCAR and his beloved Green Bay Packers at Original FB42's Ramblings. He admitted in one post that he enjoyed "Music & Lyrics," the Hugh Grant and Drew Barrymore "chick flick." He wasn't paid for that.

But then he copped to an old "Days of Our Lives" habit, confessing that he "got sucked in during the Marlena-possessed-by-the-Devil days." A soap opera website paid him for that mention.

Tensions over sponsored blogging flared into a geek-world smack down at the Always On technology conference in New York this winter.

Jarvis, the technology blogger, was moderating a marketing panel when he chastised PayPerPost. He said he was appalled by a video one Postie made showing her children smashing a camera because it wasn't from Hewlett-Packard Co., a stunt that he said turned the family into "cheap shills." His panelists agreed, calling PayPerPost "corrosive" to the online conversation.

Ted Murphy, PayPerPost's 30-year-old chief executive, was in the audience and objected, saying his marketplace has helped bloggers become more successful.

Cameras caught the clash for "RockStartup," the self-produced reality series that Murphy is pitching to TV networks. The show fashions "the Murphman" and the rest of the PayPerPost team as entrepreneurial "rock stars," even if the clean-cut, fresh-faced Murphy looks more like a Nordstrom pianist.

Sponsored posts provide supplemental cash for bloggers. But Internet marketing firms and their investors say the business is potentially huge for them.

PayPerPost generates hundreds of thousands of dollars a month in revenue from advertisers, Murphy said. It raised $3 million in venture capital last fall and is working on a second round of financing.

Silicon Valley venture investor Tim Draper, a PayPerPost stakeholder and a longtime backer of online marketing companies, said the kerfuffle reminded him of the early days of advertising-sponsored search engines such as GoTo.com, which helped create a multibillion-dollar industry.

"This is a new way of looking at advertising," Draper said.

Draper likened sponsored blogging to product placement in movies: "You put an ad inside the text and it's more of a subtle way of advertising. It doesn't take away from the blogger."

As for the ethical debate, Murphy said the vast majority of bloggers don't consider themselves journalists, so they don't need to follow that profession's practice of keeping clear lines between content and the advertising that supports it.

The FTC noted in December that ties between word-of-mouth marketers and their "sponsored consumers" must be disclosed, and that it would be on the lookout for deception.

Soon afterward, PayPerPost for the first time required bloggers to disclose their sponsored status, although participants were allowed to pick their method of doing so.

Mary Engle, associate director of advertising practices at the FTC, declined to comment on PayPerPost or its rivals, other than to emphasize that sponsorships must be "clearly and conspicuously" disclosed.

"It's important for the consumer to understand who is behind the message they're hearing," she said.

Marketing executive Tracy Helms, whose Dallas firm, Unleaded, hired 200 bloggers including Caldwell on behalf of the producers of "The Ultimate Gift," acknowledged having reservations before tapping the PayPerPost army.

"You can't help but have the tinge of, 'Is this the right thing?' " Helms said.

But he said bloggers were genuinely inspired by the theme of the film and the philanthropic effort that already has raised more than $5 million for nonprofit groups.

Bloggers say they guard their integrity by sticking to advertisers they can honestly support. Caldwell steered clear of an offer from a drug rehab clinic that invited bloggers to "write a fictional positive story of success with our treatment center … it's very important that it be believable."

Then there was the law firm looking to find clients who had used a certain birth control patch. The firm told bloggers to "get creative, have fun with your post and help spread the word" — the word being that the patch was killing and injuring young women.

"I realize they're lawyers," Caldwell said, "but come on, that's just tacky."

 

Josh Friedman, Los Angeles Times. March 9, 2007

Copyright © 2007 Los Angeles Times. All rights reserved.