from the paging-the-FTC dept
While we've had some reservations in the past about the FTC's guidelines on endorsements and testimonials in the online arena, our concerns have tended to be about the grey areas of the law. The way that reviews for books, music and games often work falls into this grey area, with products and media handed out for review, and the disclosure guidelines the FTC laid out seem overly intrusive. Whatever our reservations about those guidelines, however, the goal of preventing the surreptitious pimping of a product or service by a trusted source that has direct connections with it was laudable.
Which brings us to two YouTube personalities, TmarTn and Syndicate Project, whose real names are Trevor Martin and Tom Cassell. These two have spent a great deal of time urging their followers to use the CSGO Lotto website while, at best, barely disclosing the site's sponsorship, and never even coming close to acknowledging that they are executives of the company behind the site.
Trevor Martin and Tom Cassell, known online as TmarTn and Syndicate Project, uploaded videos in which they appeared to win big prizes playing CSGO Lotto. But it has emerged that the pair are presidents of the company, which is incorporated in Florida.
Mr Cassell apologised on Twitter to those who felt misled. In a YouTube video message to his followers, which he later deleted, Mr Martin said that the ownership of CSGO Lotto had "never been a secret".
"I created the site. I wanted to build something awesome for other people to enjoy and I played on it," he said. "Obviously, on my end, me playing on Lotto rather than other sites, gives me an advantage because it promotes my own site, but it is not immoral, there is nothing wrong with it. I am 100% honest."
Yet it's difficult to square that response with the facts. CSGO stands for Counter Strike: Global Offensive, a very popular online shooter. Within that game, players can mod their weapons with "skins", or visual modifications. Whatever that sounds like to you, please understand that there is serious money in the use, trading, and selling of these skins. That in turn has spawned websites that allow you to gamble these skins, wagering them to potentially win more valuable skins at the end of a game, with winners supposedly chosen at random. For this, CSGO Lotto has an 8% rake on the value of the skins given away in a round.
So, what kind of money are we talking about here? Well...
In April, Bloomberg reported that online betting on games such as CSGO was a booming industry worth billions of dollars.
Yeah, it's a big deal. Now, back to our two YouTubers and their claims of total honesty and transparency. Despite what they say, the current outrage has only come about because another YouTuber dug up the ownership details on the company behind CSGO Lotto, finding that the site's president is one Trevor Martin and its vice president is Thomas Cassell. Before those details were published? No controversy. Now that they've been published? Controversy. These two can claim they properly disclosed their associations all they want, but the fact that those disclosures didn't do the job of informing viewers that they owned the site says everything.
Oh, and about those disclosures:
In short, h3h3 was unable to find any instances of Martin or Cassell disclosing affiliation with CSGO Lotto—let alone high level operation of it....
On top of that, in an earlier video about CSGO Lotto that’s since been made private (you can see it in h3h3's video above, however), Martin said things like, “We found this new site called CSGO Lotto, so I’ll link it down in the description if you guys want to check it out. We were betting on it today and I won a pot of like $69 or something like that, so it was a pretty small pot, but it was like the coolest feeling ever. I ended up following them [CSGO Lotto] on Twitter and stuff, and they hit me up and they’re talking to me about potentially doing like a skin sponsorship.” That is, as PC Gamer points out, a pretty strange way to talk about a site you helped found.
Martin has also claimed that CSGO Lotto videos did include disclosures, but if you run videos like “HOW TO WIN $13,000" through the ol’ Wayback Machine, it appears that a very slight disclosure—“video made possible by CSGO Lotto”—was added after the fact.
The wonderful thing about new media outlets like YouTube is that the barriers to gaining a following are lower. The other side of that coin, however, is that trust is the ultimate selling point, and it's the kind of thing you can only lose once. It's hard to imagine that these two will have any kind of loyal following after this episode, not to mention that the FTC is likely to come calling. They've done it before, after all.
Either way, lesson learned, boys?