FTC Rules Get Public Comment

The Federal Trade Commission (“FTC”) announced this summer that it is seeking comments on its plans to revise its digital advertising guide, potentially by way of revamped guidance that takes the metaverse/virtual reality into consideration. First released in 2000 and updated in 2013, the regulator’s “.com Disclosures Guide” aims to enable mobile and other online advertisers “to make disclosures clear and conspicuous to avoid deception.” The FTC revealed in June that it is seeking public comment on ways to modernize the guidance to align it with new advances in technology – including virtual reality (“VR”), augmented reality (“AR”), gaming, the metaverse, etc. – and how advertisers now interact with consumers.

In its initial call for comments, the FTC highlighted its desire to crack down on advertisers’ attempts to “avoid liability under the FTC Act by burying disclosures behind hyperlinks,” along with the rising use of “dark patterns” and “other forms of digital deception” – and many of the nearly 30 comments submitted focus on these issues. However, among the questions posed by the regulator in its June call for comment are two that specifically point to “emerging online technologies, activities, or features, such as … the use of advertising content embedded in games” and “issues that have arisen with respect to advertising that appears in VR or the metaverse.”

Since then, a number of the comments submitted – 8 out of 28, to be exact – make mention of the metaverse, and from those comments, a few key themes emerge as common points of consideration and concern of stakeholders, including lawyers in this space, ad watchdogs, academics, and industry organizations.

The Metaverse Is Still Very New

Common threads in all the submitted comments are the persistent novelty of the metaverse and the lack of clarity about its future. As a number of academics affiliated with Princeton University’s Center for Information Technology Policy (“Princeton”), for example, assert in their comments to the FTC, “The development of mixed reality (MR), VR, and/or ‘metaverse’ modes of interacting with services is still in their infancy.” Bryan Cave attorney Jim Dudukovich echoed this notion in a submission of his own, stating that “we are still in in the early stages of those worlds and may not fully understand how they will evolve in the future.” In light of the “emerging” nature of the metaverse, Baker Hostetler’s Linda Goldstein, writing on behalf of the Performance Driven Marketing Association (“PDMA”), notes that there is “a great deal of ambiguity [at play] about when and how the new platforms will develop.”

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