FTC Testifies on Marketing of Violent and Explicit Video Games

The Federal Trade Commission today told a congressional subcommittee that, although the video game industry has made progress in complying with and improving its self-regulatory policies on the marketing of violent video games, more needs to be done. Lydia Parnes, Director of the Federal Trade Commission's Bureau of Consumer Protection, told the House Committee on Energy and Commerce Subcommittee on Commerce, Trade, and Consumer Protection that despite progress in limiting ads for M-rated games in popular teen media and nearly always providing rating information in advertising, “there remain a number of concerns relating to video games and how they are marketed.”
“Because the expressive content in video games has been considered protected speech under the First Amendment, there is a very narrow range of permissible government involvement with their advertising and marketing,” the testimony notes. “As the industry continues to produce games with increasingly explicit content, it becomes even more incumbent upon industry to enforce and enhance its self-regulatory guidelines governing marketing, and upon retailers to implement and enforce policies restricting children's access to Mature-rated games.” The testimony also states that “the Commission will continue to monitor closely developments in the area and will initiate actions, such as the case challenging the marketing of (Grand Theft Auto:) San Andreas, when appropriate.”

Last week, the FTC announced that it had accepted for comment a consent agreement with the makers of Grand Theft Auto: San Andreas that would resolve charges that the companies failed to disclose to consumers sexually explicit content that, while not seen or used during normal game play, resided on the game disc and ultimately was discovered by players. These developments had led to a more restrictive rating for the game by the Entertainment Software Rating Board. The testimony states, “Undisclosed explicit content in video games is obviously a matter of serious concern. Parents must be able to rely on the accuracy of the industry rating system. Practices, whether by game manufacturers or a third party, who undermines the integrity of this system, must be addressed.”

The testimony describes the FTC's monitoring of the marketing of violent entertainment since 1999, and focused on the video game industry. It highlights findings from the five reports issued since that time by the Commission. The testimony notes that the latest undercover shop, released March 30 of this year, “saw a substantial decrease in the number of M-rated games sold to unaccompanied children, particularly by large retailers. Forty-two percent of the secret shoppers . . . who attempted to buy an M-rated video game without a parent were able to purchase one.” Although large retailers performed better, “there is still substantial room for improvement.”

The testimony outlines areas of continuing concern for parents as well. The testimony notes that “it is critically important that parents know about and use the Entertainment Software Rating Board (ESRB) ratings and content descriptors when choosing games for their children.” The testimony also states that parents need to “understand that game content, especially on PC games can be modified or changed through modifications or 'mods' that are widely available on the Internet.”

The testimony also describes upcoming surveys and research by FTC staff on entertainment industry practices, including a follow-up survey from research done in 2000 “on consumers' familiarity with and use of the ESRB video game rating system.” The testimony also notes that “the Commission staff currently is conducting another undercover shop to test whether children under age 17 are able to buy tickets to R-rated films at movie theaters, R-rated movies on DVD, explicit-content labeled music recordings, and M-rated video games.”

The Commission vote to approve the testimony was 5-0.

Camelia C. Mazard
202-589-1837
cmazard@dbmlawgroup.com