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According to a recent news article, the Korean FTC fined three game companies for allegedly not making clear disclosures regarding the odds associated with certain loot boxes. Loot boxes are items that players can win or buy and that give the player a virtual item, but the players do not know which one until they “open” the box. According to the article, some of the games encouraged players to buy loot boxes to collect 16 puzzle pieces, and award players with special in-game items once the collection is completed. This mechanic, known as Kompu Gacha,  was once popular in Japan until the Japanese FTC raised concerns there.
Continue Reading Korean FTC Issues Fines Over Loot Box Advertising

In our previous blog post, “Brands Beware!!! FTC Scrutinizing Influencer Posts for Compliance with Endorsement Guides,” we reported that the Federal Trade Commission (“FTC”) had issued more than 90 letters to brands and influencers, making it clear that it is paying close attention to influencer-based marketing.  More recently, the letters have been made publicly available, providing valuable insight into the types of disclosures that the FTC considers unacceptable or inadequate.
Continue Reading A Deeper Dive Into the FTC Crack-Down on Social Media Influencers: What You Should Know Before You Post

In response to a petition from a coalition of consumer groups last year complaining about the need for disclosures by social media influencers, the FTC recently announced on April 19, 2017 that it had issued more than ninety letters reminding influencers and brands that “if there is a ‘material connection’ between an endorser and the marketer of a product – in other words, a connection that might affect the weight or credibility that consumers give the endorsement – that connection should be clearly and conspicuously disclosed, unless the connection is already clear from the context of the communication containing the endorsement.” The FTC explained that material connections could “consist of a business or family relationship, monetary payment, or the provision of free products from the endorser.” A copy of the form of the letter, which explains that clear and conspicuous disclosures are required can be found here.
Continue Reading Brands Beware!!!! FTC Scrutinizing Influencer Posts for Compliance with Endorsement Guides

Lumos Labs recently paid $2 million to the FTC to settle claims that it deceived consumers about its brain training application’s ability to increase cognitive function. According to the FTC,  the company alleged that its app, called Lumosity, provided many beneficial effects including the ability to improve users’ school and work performance, delay the onset of age-related cognitive disorders and help restore brain function lost as a result of brain trauma and other health conditions.
Continue Reading Serious Games Require Serious Attention to Marketing Statements

The New York attorney general issued a cease and desist order to a number of daily fantasy sports (DFS) operators alleging that DFS constitutes illegal gambling under NY state law. According to the AG’s interpretation, DFS operations constitute illegal gambling under New York law, according to which, “a person engages in gambling when he stakes or risks something of value upon the outcome of a contest of chance or a future contingent event not under his control or influence,” because players are placing bets on events outside of their control or influence, specifically on the real-game performance of professional athletes.
Continue Reading New York Sacks Daily Fantasy Sports; Gives Pass to Traditional Fantasy Sports

On May 6, 2015, the European Competition Commission released a new Digital Single Market Plan, and simultaneously launched a broad antitrust investigation into e-commerce.  The DSM plan, consisting of sixteen proposals, seeks to create a single digital European market where access to digital goods and services is unfettered across all 28 member states.  The European Competition Commission will investigate whether firms’ restrictions on cross-border online trade violate the EU competition laws, and attempt to remedy them through enforcement mechanisms.  High on the list is the geo-blocking of online content, including video games.  The impending probe will likely target some large U.S. technology companies.
Continue Reading EU Investigating Geo-Blocking of Online Video Games

As companies are presented with the ever-challenging goal of achieving and maintaining brand recognition, many fashion companies are now attempting to engage consumers in both the real and virtual worlds. Gaming represents one non-traditional avenue that has undergone recent growth, as brands find value in connecting with existing and potential consumers through interactive online means.Continue Reading Game On!

In the first part of this article series, we looked at choosing a video game for product placement based on game attributes. Now we begin addressing the details of the branding deal—specifically, deciding how users can interact with the brands within a game. For brand owners, the concern is how in-game treatment of the brand will affect the brand’s image. For game developers,  the focus is more on how inclusion of the brand will affect overall game play. Balancing these sometimes-competing interests is the key to reaching an agreement that will benefit everyone involved.
 Continue Reading Brands and Video Games: Three Steps for Finding a Perfect MatchStep 2: Balancing Interests in User Interaction

Millions of people around the world play video games on a daily basis. As a result, video games present an amazing marketing opportunity. But how do you identify which game is appropriate for your brand? There is endless variety in the scope and presentation of video games—from vanquishing zombie hoards on your PC, to buying and selling real life locations on your mobile phone, to throwing a game-winning touchdown on your console. When it comes to branding and product placement, it’s important to find the right game to reach your target audience and maximize the value of your investment.
 

 

Continue Reading Brands and Video Games: Three Steps for Finding a Perfect MatchStep 1: Analyzing Attributes of Prospective Partners

Video games and feature films have a lot in common. Both tell stories and have exciting visuals and music. Although one is "interactive", recent Blu-ray HD discs are now turning linear films into more immersive, interactive experiences. Rights and talent deals for both have likewise followed a path towards convergence with terms and consideration often being negotiated and drafted the same way. Nowhere is this trend more obvious than the increasing popularity of product placement in enhancing the economic value of video games by making the game play more realistic while providing increased marketing value and good will by allowing the game developer and product owner, generally at no out-of-pocket cost, to reach new audiences.Continue Reading Branded: Product Placement and Video Games