Escolar Documentos
Profissional Documentos
Cultura Documentos
86
January 2011
MERCATUS
ON POLICY
F
ederal policy makers, state legislators, and
state attorneys general have recently shown
interest in regulating commercial advertising
UnappReciated BeneFits and marketing.1 Several new regulatory initia-
tives are being proposed, or are already under-
OF adVeRtising & way, that could severely curtail or restrict advertising or
cOMMeRcial speech marketing on a variety of platforms.2 The consequences of
these stepped-up regulatory efforts will be profound and
will hurt consumer welfare both directly and indirectly.
By Adam thierer The affected platforms range from traditional media (news-
papers, TV and radio broadcasters, etc.) to the newest media
outlets (the Internet, online ad networks, social networks,
video games, mobile devices, and interactive television). This
expanded regulatory activism would apply to issues and prod-
ucts including pharmaceuticals, tobacco,3 alcohol, advertising
during children’s television programming,4 online marketing
to children,5 the loudness of ads on television,6 product place-
ment marketing7 and testimonials,8 and more. Perhaps the
most notable of these efforts is the recent push to impose a
comprehensive regulatory regime on online advertising and
data collection efforts in the name of enhancing consumer
privacy.9 This might include a so-called “Do Not Track” mech-
anism that would block advertising or data collection through
the mandatory reengineering of web browsers.10
3. “Obama Signs Tough Tobacco Regulations,” UPI.com, June 22, 2009, 20. Ibid., 765.
http://www.upi.com/Top_News/2009/06/22/Obama-to-sign-tobacco-bill/
UPI-61161245670133. 21. Richard T. Kaplar, Advertising Rights: The Neglected Freedom (The Media
Institute, 1991), 60.
4. Matthew Lasar, “FCC: TV Ad Content for Kids Back on the Regulatory
Table,” Ars Technica, July 23, 2009, http://arstechnica.com/tech-policy/ 22. Ibid., 71. Also see, Jonathan W. Emord, “Contrived Distinctions: The
news/2009/07/fcc-tv-ad-content-for-kids-back-on-the-regulatory-table.ars. Doctrine of Commercial Speech in First Amendment Jurisprudence,” Policy
Analysis no. 161, Cato Institute, September 23, 1991, www.cato.org/pubs/
5. Berin Szoka and Adam Thierer, “COPPA 2.0: The New Battle over Privacy, pas/pa-161.html.
Age Verification, Online Safety & Free Speech,” Progress on Point 16, no.11,
The Progress & Freedom Foundation, May 21, 2009, www.pff.org/issues- 23. William F. Arens, Contemporary Advertising 10th Ed., (New York:
pubs/pops/2009/pop16.11-COPPA-and-age-verification.pdf. McGraw-Hill Irwin, 2006), 61.
6. Juliana Gruenwald, “Senate Backs Bill Aimed At Reducing Loud TV Ads,” 24. Ibid.
Tech Daily Dose, September 30, 2010, http://techdailydose.nationaljournal.
25. “Both the Federal Trade Commission and the Supreme Court have ruled
com/2010/09/senate-backs-bill-aimed-at-red.php.
that, by encouraging competition, advertising has the effect of keeping prices
7. Federal Communications Commission, Notice of Inquiry and Notice of Pro- down,” says Arens. Ibid., 60.
posed Rulemaking In the Matter of Sponsorship Identification Rules and Embed-
26. Bates v. State Bar of Arizona, 433 U. S. 350 (1977).
ded Advertising, MB Docket No. 08-90, June 26, 2008, http://hraunfoss.fcc.
gov/edocs_public/attachmatch/FCC-08-155A1.pdf. Also see W. Kenneth
27. Robert G. Picard, The Economics and Financing of Media Companies
Ferree and Adam Thierer, Comments of The Progress & Freedom Foundation
(Bronx, NY: Fordham University Press, 2002), 122.
In the Matter of Sponsorship Identification Rules and Embedded Advertising,
(Washington, DC: The Progress & Freedom Foundation, September 19, 2008), 28. Mary Alice Shaver, “The Economics of the Advertising Industry,” in Alison
www.pff.org/issues-pubs/filings/2008/092208SponsorshipFiling.pdf. Alexander, et. al., Media Economics: Theory and Practice, 3rd ed. (Mahwah,
NJ: Lawrence Erlbaum Associates, 2004), 250.
8. Federal Trade Commission, Guides Concerning the Use of Endorsements
and Testimonials in Advertising, October 2009, www.ftc.gov/os/2009/10/0 29. To some extent, these are all just variations of a fee-for-service business
91005endorsementguidesfnnotice.pdf. model. “Micropayments,” for example, would require a small payment for each
media unit accessed or downloaded, such as $1 per news article or song.
9. See Adam Thierer, “Online Privacy Regulation: Likely More Complicated
(And Costly) Than Imagined,” Mercatus on Policy, Mercatus Center at George 30. See, e.g., Chris Anderson, “Free! Why $0.00 Is the Future of Busi-
Mason University, December 6, 2010, http://mercatus.org/publication/ ness,” Wired, February 25, 2008, http://www.wired.com/techbiz/it/maga-
online-privacy-regulation. zine/16-03/ff_free.
10. Tanzina Vega and Verne Kopytoff, “In Online Privacy Plan, the Opt-Out 31. Arens, Contemporary Advertising, 50.
Question Looms,” New York Times, December 5, 2010, http://www.nytimes.
com/2010/12/06/business/media/06privacy.html. 32. Anthony R. Fellow, American Media History, 1st ed. (Bosten: Wadsworth,
2005), 315.
11. John E. Calfee, Fear of Persuasion: A New Perspective on Advertising and
Regulation (Washington, DC: AEI Press, 1997), 2. 33. Paul Starr, The Creation of Media: Political Origins of Modern Communica-
tion (New York: Basic Books: 2004), 263–4.
12. See, e.g., George Stigler, “The Economics of Information,” Journal of Politi-
cal Economy 69, no. 3 (June 1961): 213–225; Philip Nelson, “Advertising as 34. Ibid., 264.
Information,” 82 Journal of Political Economy 4 (1974): 729–754.