Stowe Boyd is doing what I figured would happen eventually with PayPerPost. He signed up for an account and has outed an advertiser and a blogger. You can read Stowe's whole post, but in a nutshell he quickly found a blogger that wrote about a service for payment and never disclosed the relationship.
How long before the entire list of advertisers is out? I'd give it a few weeks. Figuring out who is blogging for payment is very easy as Stowe discovered. Just Google the suggested copy and bingo. Or as a colleague pointed out, just visit the PPP blog and look at the comments. The majority of the people commenting are PPP users. Just visit their blogs and read away.
Like Scoble, I think the primary impetus for advertisers doing this is not wholly product mentions. It's Google juice. Advertisers are paying for links. Get 100+ bloggers to link to your site with a specific word and watch your Google position sky-rocket.
I've written some opinions before about PayPerPost which you can read, but the basic issue I have always had has been the disclosure thing. If bloggers were required to disclose the compensation for a post then I'd be all for it. As of now it's up to the blogger to decide if they want to disclose the payment/sponsorship. Some are doing it, others are not. That will always be the catch, and cause many people to deride the service.
Would making disclosure mandatory really hurt their business though? Probably not in the long run. Both parties involved would still benefit. Bloggers receive compensation and advertisers get links (and mentions).
Brian weighs in with his opinion about the funding of the venture, but I am closer to the issue here in Florida. I recently met Dan Rua who is one of the VCs involved with the deal. Dan's a nice guy and is doing good work funding start-ups in the Florida market (Lord knows we need that). Dan like many VCs sees an opportunity. Yes there are some issues with PPP, but if they would just handle that disclosure thing I think many people would drop many of their complaints.
Update: Jason Calacanis has some strong words.
Update 2: Here is a blogger that was rejected by PPP because they used 'rel=nofollow' in their links. In other words Google won't follow the link. So what matters more to advertisers on PPP, the blogger mentioning their product or the link?
Visitor Comments
And Dan is the first to comment on Stowe's article and doesn't disclose that he was involved in the funding :-)
Posted by: Chris Scott | October 5, 2006 1:42 PM
That's just weird Chris. I guess linking to my venture capital blog -- where I specifically blogged about my investment in PayPerPost -- was sneaky, sneaky. Actually, siglinks are a standard mode for providing context on the author of comments. Siglink click throughs exist specifically for that type of a contextual blogosphere.
Our different prespectives on this are a great example why one entity will never be able to define what is "right" for blog ethics. Bloggers will have to live with their choices and I am 110% comfortable continuing to use siglinks to provide context on who I am and where I'm coming from -- although a new comment entry field such as "disclosures" might be an interesting addition for some blog/comment engine.
Posted by: Dan... | October 5, 2006 2:12 PM
Hi Dan: I didn't say you were being sneaky. I said you didn't disclose in the post you were involved in the funding. The smiley was to point out the irony of this since the jist of the debate is about disclosure.
Posted by: Chris Scott | October 5, 2006 2:45 PM
I don't really have a problem with it either as long as there's disclosure, but Josh I'm not 100% in agreement that everybody wins if there is disclosure. Yes, the advertiser gets its Googlejuice and product mentions, and the blogger gets paid. But they also both lose in a way. The blogger's audience will probably not appreciate all the "product placement" in the posts, and they'll know that the product mentions were bought and not necessarily a genuine opinion so they're not necessarily worth much from the reader's perspective in terms of being a trusted review. The blogger may lose some traffic as a result.
Posted by: Laura | October 6, 2006 7:57 PM
Laura: my PPP research shows audience growth as bloggers embrace PPP, its quality rating system and its community of 'posties' sharing best-blogging-practices -- likely because blogging frequency goes up with a revenue model, blog topic diversity grows, and best practices start to pay dividends. Revenue models often create this kind of discipline and drive to quality for previously volunteer marketplaces.
Another thing revenue models do is bring new people to consumer content creation; along with diverse knowledge, skills, experiences and perspectives. Unless you believe "only certain people should be allowed to play", that growing influence of the blogging masses is part of what worries the elites, conciously or not.
Posted by: Dan... | October 7, 2006 2:15 AM
Dan,
There's also a revenue model in dealing street drugs, but that makes it neither ethical nor wise to do so.
Posted by: shel israel | October 7, 2006 1:09 PM
Shel: either purposely or on accident, you misinterpret my message to Laura around revenue models (and whether PPP content generators may lose or gain audience). The message is that revenue models, combined with quality rating systems like PPP's will drive markets toward quality and raise the value and diversity of the entire market.
Your comparison to illegal activities like drug dealing (and Arrington's comparison to statutory rape) is just more of the FUD so prevalently used by the elites so far -- and that's just sad. There will always be exceptions in open markets, but my research from inside and outside the platform doesn't support the FUD being spread.
That said, if you believe PPP should act like a government entity that tells people how to write their blogs then I worry we'll never get past the FUD. If, however, you understand that you, Arrington and other elites all make a personal choice about how to author your blog and other, lesser-known bloggers, have that same right then we may actually get somewhere.
Posted by: Dan... | October 7, 2006 5:41 PM
Hey Josh! I am a PR major at Auburn University, and I am in Robert French's PR Style and Design class that you visited. It was so refreshing to talk to someone who has made a living through social media online especially through blogging since Robert has put such a focus on the growing popularity of blogging. It was so interesting to hear you talk about all the different ways you have been able to help various companies through blogging. I liked your story about how you were able to help Shell figure out the problem with the price differentiation between those two gas stations that were in close proximity to one another. I also found it interesting that many companies do not realize they have negative criticism when their names are googled. Keep up the good work!
Posted by: Rachel D. | October 8, 2006 6:30 PM