• by Wendy Davis , Staff Writer @wendyndavis, December 24, 2015

The Federal Trade Commission's new guidance on native ads is raising concern at the Interactive Advertising Bureau, which is questioning the basis for the agency's recommendations.

“While guidance serves great benefit to industry, it must also be technically feasible, creatively relevant, and not stifle innovation," Brad Weltman, vice president for public policy, said Thursday in a statement.

The IAB says it will ask the FTC to clarify provisions of its recommendations "that could impinge on commercial speech protections and longstanding advertising conventions familiar in other media."

The FTC specified in its long-awaited guidance, issued Tuesday, that native advertising formatted to resemble editorial content must be labeled with terms like "advertisement," "paid advertisement," or "sponsored advertising content."

The agency specifically criticized the use of some terms currently in labels, including "promoted" or "promoted stories," on the grounds that those words "are at best ambiguous and potentially could mislead consumers that advertising content is endorsed by a publisher site."

Even terms like "promoted by," followed by the name of the advertiser, could be misinterpreted "to mean that a sponsoring advertiser funded or 'underwrote' but did not create or influence the content," the FTC says.

Weltman stated that the new labeling requirements are "overly prescriptive, especially absent any compelling evidence to justify some terms over others."

But Santa Clara University law professor Eric Goldman notes that less specific guidance also might have prompted complaints.

"The FTC's in a bit of a no-win position," he tells MediaPost. "If they provide overly general statements, everyone's going to complain about the lack of specificity. If they're overly specific, everyone's going to complain about micromanaging."

At the same time, he points out that whatever evidence the FTC relied on when crafting its guidance could quickly become dated. "Consumer expectations are fluid," he says. "It's impossible to know how people will understand things in the future."