Sinclair Broadcast Group, which manages several radio and television stations from Hunt Valley, Maryland, now faces a hefty fine from the Federal Communications Commission. It’s a fine of a whopping $13.4 million, to be exact.
The reason for the fine is an issue business owners in many forms of media should pay attention to. For nearly seven months, Sinclair aired content that a third party paid to promote, but failed to adequately inform viewers that some were sponsored features. For other features, Sinclair disclosed that a third party purchased them, but not which entity paid for them.
Sinclair’s content in question appeared to look like authentic news stories and television segments. According to the FCC, this was too misleading to the average viewer. These advertisements wouldn’t have caused any issue if Sinclair had clearly indicated which features were actually commercials as well as the entity that funded them.
Disclosing sponsored content is essential because audiences can interpret ads differently than actual news. Advertisement “tags” allow consumers to detect possible end-goals and stay skeptical of content.
In fact, the FCC regulates paid content with sponsorship identification rules to keep viewers informed. Media-related business owners should make sure they follow these laws to avoid expensive fines and litigation. This includes political advocacy segments and sponsored product-related news stories.
Sinclair responded to the fine, saying that they plan to contest the towering sum. Individual members of the FCC seem to disagree on whether the amount was fair.
Sponsorship identification is an example of business litigation that can become extremely complex and involve many factors, such as how many people viewed the content, any damages that it caused and proof of intentions. No matter the type of litigation, business owners should consult with a skilled attorney to reach the best possible outcome.