Skip to main content

Microsoft accused of paying YouTube users to post positive videos of Xbox One

microsofts xbox one promo campaign youtube raises important disclosure questions app
Image used with permission by copyright holder

Microsoft and Machinima are the targets of raised eyebrows with the revelation of an Xbox One promotional campaign that awarded extra money to YouTubers – in the form of an extra $3 CPM (roughly, cost per thousand pageviews) – for cheerleading the new console. The terms of the promotion require the user to post a video that includes at least 30 seconds of Xbox One gameplay footage and some mention of the console by name, according to Ars Technica. An allegedly leaked copy of the associated legal agreement from a Machinima email relating to the promotion further notes that the video’s creator “may not say anything negative or disparaging about Machinima, Xbox One, or any of its Games.” More importantly, the details of the promotional agreement must remain undisclosed in order to qualify for payment.

That last point is where things get tricky. The Federal Trade Commission (FTC) guidelines governing the way endorsements and testimonials can be used in advertising is very clear on the need for disclosure in a variety of situations. This passage is particularly relevant here: “When there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed.” 

Recommended Videos

In this case, Microsoft is the “seller of the advertised product” and a participating YouTube user is the “endorser.” There’s a connection between the two as a result of the promotion’s terms, but the secrecy enforced by the associated legal agreement seems to run counter to the FTC’s disclosure requirements. The question is: does the extra money being offered threaten to “materially affect the weight or credibility of the endorsement”?

The promotion only extends to the first 1.25 million video views overall, which means that no more than $3,750 in total could be paid out to the assorted video creators. If those views split evenly across 10 video creators, the payout for each would be $375. With 100 creators and an even split, it’s $37.50 apiece, and $3.75 apiece for 1,000. Ultimately, there’s not a large amount of money being offered here. What’s more, there’s no way for a video creator to know in advance how many views a particular video will draw. Legal experts looking at this situation would have to determine whether or not all of these factors create a disclosure requirement.

There’s less of a grey area in the leaked legal agreement’s non-disclosure clauses. It’s possible that the legal minds at Microsoft and Machinima are attempting to capitalize on a loophole, but barring video creators from disclosing the terms of the agreement – specifically the fact that they stand to receive money in exchange for a non-negative product endorsement – seems to directly counter the FTC’s disclosure guidelines. The FTC defines an endorsement as “any advertising message (including verbal statements, demonstrations, or depictions of the name, signature, likeness or other identifying personal characteristics of an individual or the name or seal of an organization) that consumers are likely to believe reflects the opinions, beliefs, findings, or experiences of a party other than the sponsoring advertiser.” It’s hard to argue that a pro-Xbox One YouTube video sponsored in part by Microsoft doesn’t fall under that umbrella.

For you, the reader (and the intended audience for these videos), it’s enough to simply be aware of what’s going on for now. This approach to marketing is in its infancy. YouTube and other user-curated video-streaming services continue to be a developing quantity, and even common-sense legal guidelines governing how products can be promoted in those spaces needs time to develop. User reviews have proven to be a very powerful resource on the Internet, but as marketers figure out how to “game” such things – which we’re seeing here – we’re going to have to figure out how to start answering the inevitable questions that surface.

Adam Rosenberg
Former Digital Trends Contributor
Previously, Adam worked in the games press as a freelance writer and critic for a range of outlets, including Digital Trends…
Microsoft claims Sony pays to stop devs from adding content to Xbox Game Pass
A Samsung TV shows the Xbox Game Pass app that comes in the Samsung Gaming Hub.

In the midst of the ongoing battle to get its $69 billion acquisition of Activision Blizzard approved by Brazil, Microsoft has accused Sony of paying for "blocking rights" to prevent developers from adding their games to Xbox Game Pass.

The company filed a claim to the South American country's Administrative Council for Economic Defense (CADE) on Tuesday, commenting that Sony has been actively trying to inhibit the growth of Game Pass by keeping certain games from appearing on Microsoft's game-streaming service. In the claim, Microsoft says Sony is paying developers to keep their games out of Game Pass out of exclusivity fears. In other words, it's concerned that some of the Activision Blizzard games that are on PlayStation Plus, like games in the Call of Duty series, may become a Game Pass exclusive once the deal closes -- a concern that Microsoft deems incoherent.

Read more
How to record a gameplay video on Xbox One

Knowing how to record Xbox One gameplay is a skill every gamer should have, especially since sharing gameplay highlights has become an integral part of the landscape of modern video gaming. Luckily, the latest generation of consoles makes it easier than ever to capture and broadcast footage, even without dedicated equipment like expensive capture cards. Are you preparing for a thrilling match in Halo Infinite? Or maybe you're gearing up to face a difficult boss in your latest RPG? Either way, you're going to want to know how to capture the moment, and we're here to show you how.

Read more
The best multiplayer Xbox One games
e3 2019 gears 5 escape mode modernizes the microsoft franchise screenshot

Nearing the end of the Xbox One's life cycle, one thing is clear: Although there are some excellent single-player Xbox One games, the console is defined by its multiplayer titles. Games like Halo 5 and Sea of Thieves cement Xbox One as the place to play with friends. Including the two previously mentioned games, here are the best multiplayer games currently available on Xbox One.

For this list, we looked for multiplayer games that are best experienced on Xbox One. That includes Xbox One exclusives, of course, but also games that are enhanced for Xbox One X. Most of the best multiplayer Xbox One games are available on Game Pass, too. If you want a few more options, make sure to check out our guide on the best multiplayer games on PC.

Read more