• by Steve Smith , Staff Writer @popeyesm, January 22, 2014

File this one under "more trouble than it was worth." According to reports in Ars Technica and via purported document leaks elsewhere online, a promotional deal with Machinima has Microsoft funding a $3 CPM increase for YouTube video providers who posted items that included positive mentions and gameplay footage for Xbox One.  A copy of a letter distributed to Machinima partners at iGamerResponsibility.com outlined an offer in which the video poster incorporates at least 30 seconds of Xbox One gameplay into a video, verbally mentions the unit, tags the video with XB1M13 and submits through Poptent. The videographer is not tutored in the niceties of full disclosure, of course, so the videos are supposed to appear somehow unsolicited and spontaneous. Machinima’s representatives have confirmed to Mediapost that the company is working with Poptent on the promotion.

But if you run a search of the required video tag at YouTube this morning, you end up seeing a number of irate videos rereporting the promotion idea. Worse, the idea seems to have backfired because it resulted in several funny send-ups of the promotion in which posters deliver wooden and clearly disingenuous endorsements of the Xbox One. One of them promotes the new gaming unit in a video entitled “I Am A Whore.”

Another news source posted what appears to be a copy of the actual agreement with YouTube posters that is downright laughable in its constraints on partners.  The video running time has to be at least one minute, and “You may not say anything negative or disparaging about Machinima, Xbox One or any of its Games in your Campaign Video.” And this “native” campaign also gives specific creative instructions, requiring that 30 seconds of game play be featured within the first two minutes of the clip.

Welcome to the new face of "native" advertising: really well-masked.

As Ars Technica points out, this is precisely the kind of undisclosed promotion the FTC was warning against in its recent guidelines.

Ironically, this embarrassingly ham-handed effort was all for a mere 1.25 million video views. That is the budget limit for the campaign. One has to imagine that with only a few thousand dollars thrown at the campaign, Microsoft was testing. But what they got for their few grand was a wealth of negative press, possible ill will among gamers, and an overall diminution of trust.

I am not entirely sure what any of the parties involved here were thinking. First, attempts to go super-stealth with an online community that lives and breathes viral distribution is daft on the face of it. Building agreements that are laughably restrictive and treat disclosure cavalierly just invite cynicism. To be fair to Machinima, the non-disclosure portion of the contract does not include revealing the promotion. Company reps passed on to me the following statement: "Any confidentiality provisions, terms or other guidelines are standard documents provided by Machinima.  For clarity, confidentiality relates to the agreements themselves, not the existence of the promotion." 

OK, sure, but the ad network itself is not taking the initiative of encouraging its partners to do the right thing and be upfront that this is a paid promotion. 

And the promotion  shows a massive misunderstanding of the gaming community in particular. I know because I spent years writing for gaming pubs and listening to readers and gamers habitually accuse generally impartial content providers of collusion with hardware and software makers. Positive reviews of games and hardware loathed by some segment of the readership were predictably met with charges that reviewers were writing to please advertisers. The funniest part of this Machinima/Poptent/Microsoft promotion is that it plays out the deepest darkest fantasy about editorial integrity already rampant among gamers.

Argue all you like that the open Internet has a self-policing feature that the disclosure of this program demonstrates. After all, it lasted barely a few days before someone started posting the promotional materials. But schemes like this demonstrate how wide the Pandora’s box of "native advertising" is when fully open. The search for post-ad solutions ultimately led beyond the wink-and-nod approach to product placement and integrated in-feed “content marketing.” In those cases disclosures, albeit light, are placed with the hopes readers will overlook them. But once the church-state wall has been breached, we eventually move toward explicit efforts to deceive viewers. There's the rub here. The usual shenanigans of native ads likely do erode consumer trust. Programs like buying faux endorsements by YouTube celebs takes a sledgehammer to trust. No erosion needed.