Panel mulls stance on product placement on TV

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The FCC is considering downgrading its inquiry into product integration advertising on television, turning its proceeding into a simple investigation instead of one that could result in regulating the practice.

The decision comes as FCC chairman Kevin Martin said Tuesday that he is having trouble getting a majority of the commissioners to support a product integration rule.

"I was trying to work out a compromise all the commissioners could support," Martin said. "The underlying substance and merits of the issue everyone is supportive of."

An estimated 17% of U.S. homes have DVRs. Nielsen estimates that in primetime, nearly half of 18- to 49-year-old viewers with DVRs are watching recorded programs instead of live ones. Of these, six in 10 skip the ads.

Product integration also has been criticized by the creative guilds, which feel as if they are being forced to compromise artistic integrity by writing scripts that include product pitches. They also note that they are not additionally compensated for that work.

Last year, the WGA West asked the FCC to write a regulation that would require the networks to tell viewers when advertisers have paid to get their products integrated into TV shows.

"I believe it is important for consumers to know when someone is trying to sell them something, and that it is appropriate for the commission to examine these issues," Martin said recently.

Advertisers have been fighting any rule that would interfere with their ability to reach viewers.
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