Full Disclosure: Adelstein on Ads


Democratic FCC Commissioner Jonathan Adelstein has made the issue of payola—and plug-ola—a priority in his second term. He tells B&C that the Federal Communications Commission investigation into music-industry payola continues. On the issue of product placement, he says that some media companies are voluntarily making their disclosures longer and more prominent to avoid running afoul of increased FCC scrutiny. But more needs to be done, he says, including updating the FCC's disclosure rules to reflect changes in ad technology.

Has the FCC been lax in enforcing the rules on identifying paid programming and product placements?

We haven't gotten a lot of evidence up until now of widespread violations. I repeatedly went out and asked people if they had evidence, and it wasn't until [New York State Attorney General] Elliot Spitzer conducted his investigation [into payola in the music industry] that we were given a wealth of solid material that we needed to analyze, so the jury is out on how well we are enforcing that.

I have every confidence that we are going to do our job and enforce the law.

What about those rules as they apply to product integration or other new advertising models?

All that is permissible, so long as it is disclosed. I don't think the FCC is set up to be a good reviewer of that. We generally respond to complaints.

I think we could be more aggressive in monitoring the material that goes out and ensuring compliance with our rules. But given that we are not set up as an investigatory agency, we're going to rely heavily on outsiders to provide us information.

Do you think the FCC regulations need to be updated to reflect the fact that new technologies allow for advertising to be inserted so seamlessly into programming?

I think so. What's most important is, we make it clear what kind of disclosure is required.

Sometimes there is disclosure, but it is virtually impossible for the average viewer to see because it is so small and passes by so quickly during the closing credits. People don't notice it.

Some broadcasters have stepped up to the plate and enhanced their disclosure.

I think most broadcasters do a good job of disclosing, and I have spoken to a number of people in the industry who have taken notice of some of the concerns that have been raised and, I think, are being more aggressive about it.

Some broadcasters have come to me to and said, “Here are the things we have done in response to some of the concerns,” including making the disclosure larger and longer. I think everybody is being more vigilant now.

We do have requirements about the size and length of disclosure for political advertising. I don't see why we shouldn't have the same for any advertising that needs to be disclosed.

The current regulations require full and fair disclosure, but we have never spelled out what that means.

I think it would be helpful to licensees and the public if we were clear about what that means.

At a media-reform conference last year, you challenged the audience to send you tapes about undocumented plugs. Have you gotten any?

We haven't gotten a lot of spontaneous complaints in terms of product placement.

Do you have support in this effort?

I have spoken to all of my colleagues, and nobody has done anything but take this very seriously. And hopefully, by enforcing the rules, we will have a lot less enforcement to do.

When we send a message on these things, as we have on indecency, we see there is better compliance, and the issue becomes moot.

There has been an informal deal between the broadcasters and kids activist groups on challenges to the FCC's new kids-TV rules. The deal includes limited host-selling—banned in the old rules—in which the use of TV characters to sell products to kids would be allowed so long as the selling was confined to specific areas of a Web site. Do you see yourself voting for this compromise?

I think it is a fair compromise. I think it takes into account the need to protect children from blatant commercialism, but it also allows broadcasters to conduct their businesses in ways that we would all see as reasonable.