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Microsoft reportedly paying YouTube gamers to praise Xbox One [update]

Alleged stealth marketing campaign offers money for positive coverage

Microsoft is offering YouTube gamers payments for showing Xbox One games in a positive light, a new report alleges.

Ars Technica reports that the new promotion targets Machinima video partners, offering them $3 for every 1,000 hits they receive.

UPDATE: Machinima has released a statement to Ars Technica clarifying its involvement with the alleged stealth marketing campaign for Xbox One:

"This partnership between Machinima and Microsoft was a typical marketing partnership to promote Xbox One in December. The Xbox team does not review any specific content or provide feedback on content. Any confidentiality provisions, terms or other guidelines are standard documents provided by Machinima. For clarity, confidentiality relates to the agreements themselves, not the existence of the promotion."

UPDATE 2: Microsoft has responded to this story claiming that it has asked Machinima to add public disclaimers to all videos published as part of the Xbox marketing campaign.

"Microsoft was not aware of individual contracts Machinima had with their content providers as part of this promotion and we didn't provide feedback on any of the videos," its statement reads.

"We have asked Machinima to not post any additional Xbox One content as part of this media buy and we have asked them to add disclaimers to the videos that were part of this program indicating they were part of paid advertising."

Original story continues:

Zoom

To qualify, video producers must post a video including at least 30 seconds of Xbox One game footage, mention Xbox One by name and add an 'XB1M13' tag.

The promotion was tweeted by Machinima's UK community manager, but the tweet in question has since been deleted.

While it isn't uncommon for YouTube presenters to agree to these types of deals, it is generally accepted that full disclosure within the video is the ethically correct procedure.

However, this deal is receiving criticism because, according to a leaked copy of the legal agreement, participants "may not say anything negative or disparaging about Machinima, Xbox One, or any of its games" and must keep the agreement confidential (i.e. must not state that the video is promotional in nature).

Ars Technica suggests that the promotion may violate the Federal Trade Commission's guidelines on the use of endorsements in advertising, which require full disclosure when there is "a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement".

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