Breaking news highlights:
Barry Frank, Gumbel’s agent at IMG World, says, "It wasn’t supposed to be an infomercial. One is hesitant to say he was duped, but yeah, I was duped" by Encore TV.
Turner Broadcasting said it asked Time Warner Cable to take down the Gumbel ads. "Removal of the spots is imminent," says Janine Iamunno, of CNN Public Relations
Sources close to Gumbel say a lawsuit is being filed against Encore TV
CBS Associate General Counsel, Sanford Kryle, says: "We are pursuing a claim against the [infomercial] company. We’re not happy about it [the unauthorized use CBS brand ’Eye on America’] either."
Steve Mizer, Director of Commercial Clearance for Turner, says, undisclosed infomercials that are "so incompatible with our programming" were sold and placed by "Time Warner Cable not Turner."
Marc Lawrence-Apfelbaum, TWC General Counsel, said, "It does appear that Time Warner Cable ran these ads without making it as clear as we should have that they were ads. It is our policy to always make clear that ads are just that… I believe we have now stopped running the ads, however, and we will endeavor to make sure they are not run again without proper identification."
Updated 2:18pm 04/01/09: One day following imediaethics's report, Greg Gumbel filed a lawsuit against infomercial producer Doug Scott in Florida. See lawsuit filing.
Updated: 12:51pm 03/30/09
EXCLUSIVE: It’s a messy fight with almost as many players as a NCAA bench-clearing brawl. Two years after Greg Gumbel signed a 5-year contract with Paul Doug Scott’s EncoreTV to appear as host for, what turned out to be, a Florida infomercial company, a imediaethics investigation has set off a firestorm of corporate moves that include Turner Broadcasting asking Time Warner Cable (TWC), the local provider who sold and placed the newsroom-format infomercials, to take them off the air. TWC and other local cable companies across the US have been running the 5-minute ads since Gumbel signed on to host them without the clear labeling of "advertisement" required by the Federal Trade Commission.
Barry Frank, Gumbel’s agent at IMG World, says "I don’t like my clients doing infomercials. It wasn’t supposed to be an infomercial. One is hesitant to say he was duped, but yeah, I was duped [by Encore TV]." Frank said by phone that Doug Scott already agreed to stop running the ads but refused to provide a date when he will do so. Scott would not provide a date to imediaethics either.
Steve Mizer, Director of Commercial Clearance for Turner, verifies, by phone, that the undisclosed infomercials that are "so incompatible with our programming" (and yet have been running alongside that vaunted programming for two years) were sold and placed by local cable channels—not by Turner’s national office.
Janine Iamunno, from CNN Public Relations, in an email, said, "The ’Eye on America’ advertisement was not sold by HLN [CNN’s Headline News] for its national feed. HLN has no relationship with the advertiser. HLN has confirmed that the spots were placed by the local cable operator in the New York City market. We have contacted the local operator and they have agreed to pull the ads. We are investigating the matter further with regard to misrepresentation of HLN and its relationship to these local advertisers, and will take appropriate action based upon our investigation."
Marc Lawrence-Apfelbaum, TWC General Counsel, responded by email, "It does appear that Time Warner Cable ran these ads without making it as clear as we should have that they were ads. It is our policy to always make clear that ads are just that." He continued, "I believe we have now stopped running the ads, however, and we will endeavor to make sure they are not run again without proper identification."
If not properly vetting their commercials were not enough, TWC should be further embarrassed to learn that they were in hot water with CBS. They apparently failed to notice that Greg Gumbel, a CBS Sports anchor, was appearing on CNN Headline News (HLN) under the infomercial title, "Eye on America," which is a well-known and respected CBS brand. Even Gumbel’s office assumed that EncoreTV had gotten permission from CBS. They had not.
CBS Vice President and Associate General Counsel, Sanford Kryle told imediaethics, by phone: "We are pursuing a claim against the [infomercial] company. We’re not happy about it [the unauthorized use CBS brand ’Eye on America’] either."
Doug Scott, owner of Encore TV--and all the other company names headquartered at the same Florida address, said by phone that he had obtained rights to the ’Eye on America’ trademark. Scott also said he would immediately place a continually running static "advertisement" label after imediaethics’s suggestion that FTC required it on all his 5-minute infomercials (a fact that he undoubtedly already knew).
Scott, in an email, said, "Based on your suggestion and recommendation we are going to take it a step further by adding the word Advertisement as a static word throughout the entire segment."
By telephone, he defended himself against claims that he duped Gumbel. "Look at the contract," he said. "They were extremely aware of everything [that it was an infomercial]." Scott also claimed that the use of ‘Eye on America’ upped the asking price. "I paid twice the day rate [not to CBS]" on that basis, he said. When we asked to see the contract, he refused, saying that we would have to ask Gumbel’s side for the contract.
IMG World’s Frank responded, "No way. That’s BS."
I asked IMG if we could see the contract but they said they could not show it to me due to confidentiality restrictions cited in the agreement. Litigation is "pending". Sources, who cannot speak on the record due to their personal and professional relationships with Gumbel, have told me a lawsuit is imminent.
It appears that the ads have been removed, at least from TWC’s New York City market. But imediaethics has asked Turner and TWC if the same precautions have been taken in the rest of the country. We are waiting for TWC’c comment.
Turner’s Iammunno said, "We are always monitoring inappropriate uses of our marks, including these, and have an active enforcement program." However, we pointed out that this was not necessarily comforting as the Gumbel infomercials have been running on CNN Headline News (HLN) across the country for almost 2 years.
Mizer, who is in charge of vetting commercials for Turner, explained that their review is only for national ads sold by Turner sales people. Local cable ads are regulated only "by agreements" as a practical matter. He said "With the two or three potential ads that local cable can sell per hour, it so abundant we can’t possibly police them [across the country]."
Meanwhile, based upon information and belief, it appears that Doug Scott may be in violation of his settlement with the Florida Attorney General’s office that required him in 2007 to pay fines, enforcement expenses and pending liabilities a total of $175,000 for deceptive practices.
(Update: 1:38pm 03/30/09) Sandi Copes, Communications Director, Office of the Florida Attorney General wrote, "We are investigating the allegations that Mr. Scott is violating the terms of our agreement, but we have not yet made a determination." His deceptions cited in the original agreement included…
Look Mom, I’m on CNN Headline News with Greg Gumbel …Only Cost Me 20K
It was too good to be true. Imagine: you get the call. You have been "selected" by producers, the caller tells you, to appear with the famed broadcaster Greg Gumbel in a "television program" that airs nationwide on CNN Headline News! A Florida TV production company wants to "feature" you and the virtues of your wastewater management company.
Never mind that realistically speaking it would take an axe murderer chopping up ten people in your factory (two wouldn’t be enough) before you or your company would generate even one column inch of national news coverage. You take the bait and the game switches to where you must next agree to pay a 20K to 30K "scheduling fee" for producing your "5-minute segment" which both pretends to be and mimics the style of a news broadcast.
When Gumbel appears after a "legitimate" cable news show on an identical newsroom set and using identical animation graphics, one cannot help but be fooled into believing this infomercial is, in fact, news programming. The illusion is cemented by the well-known CBS News show brand "Eye On America," which is included in many of the infomercials. Though it is, of course, an advertisement, imediaethics has found no evidence that either the "producers" or the production company (of nearly a dozen different names) or any of its featured customers, ever uses the word "advertisement" in connection to the Gumbel infomercial in any of their sales pitches, web sites or press releases.
Go to TheEconomicReport.com. Click on "Editorial Calendar" in the top navigation bar. Note it does not say "advertising schedule," but that is exactly what it is. Below are a list of "program topics" and "The Economic Report Airtimes." Why doesn’t the web page tell the truth? These are not editorial programs or airtimes of a news magazine.
A huge list of times, cities, including major markets, and networks show the scope of the deception as well as the numerous locations where these unlabeled 5 minute ads have run as "editorial programming": Chicago, Boston, Indianapolis, St Louis, San Francisco-Oakland-San Jose, Sarasota-Venice, Sacramento, Sacramento, New York & Albany, Charlotte, Mobile-Pensacola, Ohio, Philadelphia-Atlantic City, Salt Lake City, New Jersey, Westchester, Phoenix-Flagstaff, Grand Rapids-Kalamazoo-Battle Creek, Madison, Flint-Saginaw-Bay City.
Andy Warhol infomercial sales? Every company, deserving or not, gets 5 minutes of fame
Believe it or not, dozens upon dozens of companies fell for this marketing scheme over the past two years. You name it, Gumbel appears on camera and ends up flogging a mind-numbing and illogical diversity of products, by introducing seemingly endless "stories" about the importance of different companies and organizations: Timeshare sales, barley products, medical gizmos, Internet security software, a yogurt shop franchise, small universities, wastewater management (with airtight containers—thank God), rubber products, an Orthodox Christian seminary and, my personal favorite, a distributor of aluminum trusses. Small public, private and not-for-profit organizations alike, all were willing—or were "duped", depending on who you speak to—into participating in this scheme hatched by the same Florida production company.
The final product when it does air in New York City on HLN (formerly known as CNN Headline News), immediately following news programs hosted by the likes of Lou Dobbs or Nancy Grace, it runs at the end of the hour (e.g., from 7:54 to 7:59 p.m.). This timing creates the illusion that these "innovative educational" segments are editorial content, a cinch since no running label says "infomercial" or "advertisement," as typically required by the Federal Trade Commission (FTC) who regulates truth in advertising practices on networks.
Since the bigger questions, can only be answered partially in this first report, they are stated mostly as "food for thought" under a category of "hopefully, lesson learned." However, imediaethics will update readers as the story develops.
What is Gumbel, a CBS talent, doing on HLN hawking everything from real estate sales to dodgy franchise "opportunities" –companies that he could have never properly vetted before lending his name—while at the same time, hosting the CBS college basketball NCAA Tournament? How the heck did Gumbel end up as front man in this scheme?
How did CBS allow it's well-known news show brand "Eye on America" get hijacked and aired by HLN?
Finally, how did Turner Broadcasting (who owns HLN network) or local cable companies nationwide, like Time Warner Cable, allow these news-style infomercials --that FTC has long required oblivious notification labels (such as a continuous static text citing the word "advertisement") –to air without themselves requiring proper labeling to protect the public?
In addition to the above three questions, perhaps more importantly, imediaethics has asked Gumbel’s agent, Turner, CBS, Time Warner Cable, Doug Scott, owner of Encore TV (the production company with umpteen different names, including Platinum Television, EncoreTV, The Economic Report, New Line Media Solutions, PTG Studios, etc. operating from the same address) and over a dozen of his infomercial customers—what are they going to do NOW to fix this giant mess? The good news is everyone has agreed to take action.
And what does the FTC or the Florida Attorney General’s Office (did I mentioned that Doug Scott in 2007 already paid $175,000 in settlement penalties, enforcement costs and guarantees for victims for deceptive practices?) say they are going to do about what has happened here and will they hold any or all players cited above accountable?
Responses to the above and more, follows in this report.
An advertising wolf dressed in editorial sheep’s clothing
There has been a blitz of 5-minute infomercials in the New York City market but Doug Scott’s production company web sites list that the ads are running nationwide. The Gumbel hosted "programs" run under the names "Eye On America", "Our Planet," and "The Economic Report" series. The diversity of "segments" in each is a hodgepodge of every kind of company or organization you can think of—all without hope or prospect of 5 seconds of national network air time, let alone the 5 minutes that they, in fact, purchased to promote their companies.
The problem is, of course, when the format and language of the advertisement mimics news programming but only has a brief flash of "sponsored by" at the beginning and end of the 5 minute commercial, this is hardly adequate disclosure. The fact is all news programming is sponsored. The main difference that must be emphasized here is that experts or individuals featured in news do not pay the news producers to be interviewed nor do they help write, pay for or approve scripts. Such payments occur in advertising.
The importance of maintaining the ethical firewall between news and advertising for journalism to ever remain trusted and credible cannot be over-emphasized. Hence, why the stakes are so high in this case for CBS, Turner, HLN, Time Warner Cable, Greg Gumbel and his agent, IMG World.
Matthew Ehrlich a professor of journalism at the University of Illinois, said:
"Based upon the information you have provided me, this obviously is wrong; infomercials should be clearly labeled as such and clearly distinguished from news, and journalists should not be mixed up with them…given the cutbacks in the journalism business and the current state of the economy, the temptation to air such segments likely will increase, because they are a cheaper way of filling time than actually producing legitimate news."
It is not just a matter of ethical lapses but also possible violations of federal and state regulations. The Federal Trade Commission is in charge of enforcement on a federal level. Here are some of the relevant rules for infomercials
Federal Trade Commission web site:
Does the FTC have any special policies relating to infomercials?
* Infomercial advertisers…should make sure that the infomercial doesn't deceptively mimic the format of news reports, talk shows, or other independent programming. Many FTC cases have required companies to clearly disclose that "THE PROGRAM YOU ARE WATCHING IS A PAID ADVERTISEMENT FOR [NAME OF PRODUCT]" at the beginning of an infomercial and before ordering information is given. Since many infomercials feature endorsements from consumers, celebrities, or experts, see the FTC's Guides Concerning the Use of Testimonials
*In many instances, the FTC has taken action against both the manufacturer or marketer of a product and the company that produced the infomercial…The bottom line: no one involved in the promotion of a product or the dissemination of an ad -- whether it's an infomercial, print ad, catalogue, or broadcast spot -- should look the other way when the claims seem questionable.
For media savvy viewers, all this is obvious. But for some of Scott’s customers I spoke with, I really am convinced they got caught into this trap because they really still do not fully grasp the sacred difference between ads and news stories.
Even larger companies falsely advertise their companies’ relationship to The Economic Report on the Internet. For example: "AvePoint was recently featured on the award-winning business news program The Economic Report with Greg Gumbel. Click below to watch the episode before it appears on CNN and CNBC! Click to see video." (AvePoint was called for comment).
This shocking misrepresentation—conscious or not (I mean really, "award winning business new program" ?)--is not surprising, because Doug Scott through his sales people, press releases and web sites consistently and systematically confuses journalism news and advertising to a tactical advantage. Their talk co-opts all the language from broadcast media: "episodes," "segments," "innovative educational programming," "educational television," "editorial calendar" and borrows none from advertising. Hence why it is reasonable to believe that many people—including Greg Gumbel’s agent Barry Frank—feel they were duped.
Scott does his best to blame his customers for such exaggerations but the fact is his own web sites provide the same false illusion of editorial content.
Here is how the purported programs "The Economic Report" and "Our Planet," both hosted by Gumbel, are described on the Doug Scott web sites:
About The Show
"The Economic Report airs during the day on a variety of well-known news networks throughout the country. In a multi-dimensional format, Mr. Gumbel begins by introducing each new story and each show’s theme, providing a sense of consistency throughout the segments. The stories educate viewers and provide new information that will impact their lives. With fresh content interlaced throughout each series, the show broadens perspectives, erases boundaries and opens up new avenues for progress and ideas for the audience. Viewers will gain insight on opportunities for their families, businesses, lifestyles, and financial futures. In this way, The Economic Report can be a powerful engine of change."
Doug Scott’s web site describes his "programming" as:
Our Planet is a television show that celebrates successful sustainable solutions, made by individuals, organizations, businesses and municipalities all around the world. Informing viewers on a variety of topics related to preserving precious resources like water, air, fuel and energy, the goal of the show’s producers is to broaden the perspectives of viewers from every walk of life, encouraging them to take steps towards achieving a brighter future, and a healthier and cleaner environment for all of us…With so many stories to tell, how do we choose which are most deserving? We look for stories that will help viewers find new ways to expand their horizons. As producers, we feel we have a responsibility to educate our viewers around the country in a responsible way. In 2006, our company took its commitment one step further, creating a far-reaching "green" conservation initiative. Since then, The Economic Report has delivered the latest information on sustainable living, including alternative fuel sources and special stories highlighting select "green" companies. Simply stated, one project at a time, we’re making a difference to viewers all over the world. For those in the know, The Economic Report is the show of choice."
This next one is from Doug Scott’s EncoreTV web site, the company name that signed Greg Gumbel to a 5-year contract.
"Encore TV is a major producer of independent educational television shows shown on cable networks all over the world. Founded in 1997, EncoreTV’s producers have helped companies from around the world gain exposure via nationwide broadcast television, cable and satellite distribution systems. Setting industry standards in quality educational television, EncoreTV’s talented staff of 70 full-time employees produces hundreds of hours of programming each month, reaching viewers around the world. For more information visit."
Even one of Gumbel’s speaker agents, Speakers.com, can’t keep it straight. They think it’s editorial too. The agent’s web site says, "When Greg's not doing play-by-play or hosting on-air for CBS, he can be seen on CBS' ‘Eye on America’ segments aired throughout the nation." The agency is obviously referring to the infomercials that were running on CNN HLN. No wonder CBS is unhappy.
Finally here is an example of a press release. Nearly identical ones, are easily found throughout the web with different companies and organization’s names plugged in. Note the headline on the customer's web page states:
"CNN Headline News Features Comodo on Eye On America." *
(Again, nowhere does it say "advertisement" or it is an infomercial and that they paid to appear.)
*Update: 5:30pm 03/31/09: Please note the above link no longer works. Comodo management notified me by email that their web site "has been changed since this morning." The only change I see is an error message indicating that the page has been completely removed without comment. imediaethics has asked Comondo for a clarification.
"Jersey City, NJ, October 23, 2008 - Comodo CEO and Chief Security Architect Melih Abdulhayoglu was recently interviewed on CNN/Headline News' ‘Eye on America. During a segment on internet security, Abdulhayoglu delivered his vision of a Trusted Internet to television audiences in multiple regional markets across America hosted by popular television personality Greg Gumbel. ‘Eye on America’ runs on local and regional news channels nationwide. The program informs viewers on new developments affecting the workforce and daily life."
I called Comodo Group for comment. Bill Fallon, VP Marketing for the Comodo Group said: "Thank you for bringing this matter to our attention. I've discussed the matter with Katherine [Hadow, media relations] and our legal counsel and we will be making appropriate changes to those sections of our website pertaining to the program very shortly."
Given that Comodo’s web site states--"We're all about slaying all the fraudsters, hackers and anyone else who creates untrustworthiness on the internet. We're all about creating trust online" -- it’s a good idea they are making a correction to the misleading statement.
After I sent him all sorts of examples of companies false representations about his product, Scott told me by email it was his unregulated customer’s fault for making such uniform misstatement on their web sites. He wrote, "These PR [press releases] were not written by us. They were all written by the organization that was featured on the show. We cannot control everything they put out. I am not instituting in all the agreements that all featured companies have to get our approval if they use us in their own PR efforts."
Problem was, among all the examples of companies’ press releases I sent him, was NuVim, a public company for which Scott serves as a member of the Board. He is, ahem, NuVim "Chairman of the Audit Committee - Member of the Nominating/Nominating Committee - Member of the Compensation Committee," according to the Board of Governance disclosure page required by the Securities and Exchange Commission (SEC). So the following deceptions propagated to the public from the following press release-- published by Reuters no less-- are hardly arms length.
Moreover, the specific language used in the January 2008 headline-- "NuVim Chosen as Featured Product for Eye on America"-- is in direct violation of Scott's 2007 settlement order with the Florida Attorney General (AG).
Scott tries to defend himself again, this time by email: "We are a very reputable company (the AG issue was 100% because of 2 rogue employees that did a few things inappropriate for which they were fired).
But the language in the Florida AG documentation clearly references general company-wide practices that emerged from both citizens' complaints and the AG’s investigation. As mentioned earlier Scott settled the case by paying $175,000 in penalties and fees to Florida’s enforcement and agreeing to stop certain activities defined in the Assurance of Voluntary Compliance, AG Case # L06-3-1151.
TALLAHASSEE, FL –May 25, 2007
Attorney General Bill McCollum today announced a settlement agreement which mandates that a media marketing and advertising group may no longer misrepresent their corporate associations. The companies must accurately disclose to clients what they can expect in terms of media coverage and airing of their advertisements.
Platinum Television Group, Inc., and New Line Media Solutions, Inc. produced infomercial-style television shows which were aired on national and regional television networks. Potential clients nationwide were solicited by "creative directors," who were actually salespeople that persuaded businesses to sign contracts with the companies. For a licensing fee of approximately $20,000, the businesses were told that a short five-to-seven minute advertisement featuring the business would be produced and inserted into Platinum’s programming. The businesses were usually told that the show would air on both national and regional broadcast networks.
An investigation by the Attorney General’s Economic Crimes Division determined that the companies often misrepresented sponsorships by national companies such as Microsoft and Home Depot, claiming these sponsorships paid for the production and airing of the subject programs.
In plain sight on the Internet, Scott’s companies appear to be doing many of the actions that they promised the State of Florida enforcement they would stop. Scott "shall not state nor imply that a potential client is competing with another potential client or clients for a position or placement in a television show produced or aired" by his company. In other words, the truth according to the Fla. AG, is no company is "selected" or "chosen." It is based on the ability to pay the 20K or 30K "scheduling fee" as Scott calls it.
The NuVim press release text, in addition to the headline, repeats the false claim that NuVim was "chosen by Eye on America." Moreover, the release falsely represents that Eye on America as a Televison program even after Scott agreed with the Fla. AG that he would "not represent the existence of company or television show."
NuVim(R) Chosen as Featured Product for Eye on America Broadcasts Wed Jan 30, 2008 8:00am EST
PARAMUS, N.J.--(Business Wire/Reuters)--NuVim, Inc. (OTCBB:NUVM), a leading provider of nutritional refrigerated and shelf stable ready to drink beverages and powder mixes, announced today that they have been chosen by Eye on America as the featured beverage for 2008. The 5-minute television NuVim(R) story will be aired on CNN Headline News and Regional News networks starting in the second quarter of 2008…
About Eye on America: Eye on America is a new television series that takes viewers through a journey that explores a variety of topics, trends, and relevant issues. The show marries an unrivaled host, Greg Gumbel, with a team of award-winning producers. The show's contemporary look and feel is the result of years of experience in the television arena. The show airs during the day on a variety of well-known news networks throughout the country. In a multi-dimensional format, Gumbel begins by introducing each new story and each show's theme, providing a sense of consistency throughout the segments. Captivating 5-minute segments enlighten viewers and provide new information that will impact their lives. With fresh content interlaced throughout each series, the show broadens perspectives, erases boundaries and opens up new avenues for progress and ideas for the audience. Viewers gain insight on opportunities for their families, businesses, lifestyles, and financial futures. In this way, Eye on America is a powerful engine of change.
About Greg Gumbel: Greg Gumbel is best known as an exciting and personable host on CBS for the National Football League and NCAA Basketball. He became host of The NFL Today alongside Terry Bradshaw in 1990. He's anchored CBS' coverage of Major League Baseball, college football, the Winter Olympic Games and the Daytona 500.
Calling Scott’s customers was an adventure in itself. Many seemed shocked, a few embarrassed and one downright unwilling to give up the dream that his 5 minute spot was not a "show" or a "program" but an infomercial.
The Scott customers upon learning the Greg Gumbel "segment" was a hosted infomercial seem to go through very similar Kubler-Ross’ stages:
Shock - "They approached us!" "We were solicited!"
Confusion, Denial - "It’s not an infomercial: it’s programming!"
Desiring information – "I thought it was Eye on America" [meaning the real CBS show]
Anger, Disappointment – "That’s how it was presented."
Acceptence, Mobilization -- " How can I help?"
Basically I was asking customers if they knew it was an infomercial and if they planned to correct their web site to make sure the public understands, as they now do, that the "episode’ on their business was a paid advertisement.
If you use the above chart, one might believe that Charlie Caudle, CEO of a nutritional product company, Go Healthy, got stuck at number two, denial. At first he said "Yes, it’s an infomercial. You pay the costs. The way it’s set up, you have to know." The next day, however, he took a different tack, "My wife loves watching Greg Gumbel. We have a great deal of respect for him." He was convinced that his ad would be running at over "300 stations" nationwide. I explained that I didn't think that was possible.
"I don’t consider it advertising. It is reasonable to help with the expense." When I pointed out that in news magazines, that the subject or sources of a news program do not pay for costs and if money did change hands it would need to be disclosed, Caudle held his ground. Bottom line. He paid the 20K but has not shot his video yet. "I expect Gumbel to fulfill his part of the deal –an education program presentation. The guy’s great!"
The role and obligations of Gumbel in the contracts between Doug Scott and these customers is not as benign as it first appears. The contracts between Scott and advertisers seem to have conveyed rights that place them in a position to have claims, and control of Gumbel"s performance. In other words, for Gumbel’s agents or CBS, to get all of these Gumbel videos down from say, YouTube—Gumbel and CBS must also deal with Scott and all the customers to whom Scott granted license to get the videos down.
Scott said by phone, "The scheduling fee pays for them [advertisers] to have the ability to re-purpose and re-utilize the segment that we do on them with an open of the show, and a closing credits of the show, but they can take [it to] the trade shows, and they can take [it] to put on their Web site, as well as it pays for pre-production and production of the story, and that’s all documented, and explained on the front end when we would call a company, and it’s a scheduling fee."
Again Scott promises to do the right thing and that he is a good guy. He said, "Starting today, every press release that leaves our studio will say that this is an advertisement, and then all the programming that we send out will have a static on the lower left or lower right or in the middle that says ‘advertisement,’ and then I will have my attorneys contact the FTC. We’ll let them know what we’re doing, and say, hey, this is what we started doing."
However since that call, after promising to send some documents and the name of the person they spoke with at FTC, I have yet to hear back after leaving several phone messages. I told him and Gumbel’s agent I would give them an advance look at this story so they could comment, but since Scott is no longer responding, I feel no obligation now to accommodate his request.
Background : How I noticed
I was watching HLN when this Greg Gumbel video suddenly preempted the 6 minutes before the end of news hour with Lou Dobbs. It was disorienting to see the identical newsroom scene and graphics, the trusted anchor (Gumbel) combined with the cheap-quality video showing executives speaking at tedious length in their factories or offices citing the virtues of aluminum trusses (scintillating facts like "aluminum is the best material…speeds up the loading process"). The shameless puffery, devoid of any news value or independent view made the 5 minute length and prime-time placements confusing and unjustified, if not bizarre.
Why People Still Believe the Gumbel Infomercials are editorial programming:
--Famous and Trusted Broadcast Anchor –Now as CBS Anchor of NCAA Tournament
--News Format and Stage Set, News-Style Animation Graphics
--Title is Well-Known CBS News Brand Name – "Eye On America"
-- No Running Label "Advertisement" or "Infomercial"
--News Segment-like Length: 5 Minutes Instead of 30 Minutes of Typical Infomercial Length
I quickly found on the Internet, numerous web sites and individuals who were already filing complaints and doing their own investigations. It involved not just the Greg Gumbel undisclosed infomercials but a whole history of complaints involving the same Doug Scott (going by various combinations of his name, P. Douglas Scott, Paul D. Scott) and company names –all at the same address.
The Rip Off Report
This victim recorded his call with the "scam artists" and posted it on YouTube, in multiple parts, title? "New Line Media TV FRAUDSTERS - BEWARE Platinum Television Group."
Here is an example of one commenter, on a site that tracks fraud among phone solicitation companies, of which Doug Scott’s company is one.
23 Jan 2008 -- Comment to baco99 - I already contacted CBS in December and posted their reply a couple of weeks ago. Here's what they had to say:
"I have forwarded your correspondence to our legal department. In the meantime, please be advised that EYE ON AMERICA is a copyrighted feature of the CBS EVENING NEWS. CBS does not request fees or monies from subjects of interviews or profiles. Greg Gumbel is currently a commentator for CBS Sports' NFL games.'"
So CBS was notified over one year ago. Why wasn’t anything done until now?
Or How about Scambuster’s comment regarding getting a phone solicitation from Doug Scott’s operations.
scam buster - 27 Jun 2008
Don't bother with these "opportunities" as they are scams. They're quick to say that this is not a "pay-to-play" media opportunity, yet they do seem to have to charge you a production fee, or a marketing fee, or a "partnership fee."
And what do you get for it? A video that airs on TV at a time or on a channel that no one watches. Ask yourself, when was the last time that you watched a advertorial or a paid programming show?
Hard to believe that a national sportscaster would be affiliated with such a program or would need money so badly to trade on his name like this.
Caller ID: 954-312-0480, Caller: Economic Report with Greg Gumbel : Caller Type: Commercial
Here is a response that Doug Scott posted in comments on 800notes.com
Doug Scott - 30 Jan 2008
Before actual taping with Greg Gumbel our corporate attorneys did a search on the name, "Eye On America." It was found to be available and not under copyright by any party. We filed for trademark rights with the US Patent & Trademark office and it is currently pending.
Once again, we are considered educational/informative programming. We do not claim to be the news, nor do we claim to be a non-profit or charitable institution. We are a business entity that produces segments and does charge a scheduling fee in which our feature guests are then granted the licensing rights to their segment for the purpose of re-broadcasting and re-purposing. This lends itself to a tremendous amount of corporate branding and imaging, from television to DVDs to the internet.
This fee is not unlike programming that is "sponsored by" companies, nor is it unlike companies that pay for product placement on television, in films and at sporting events.
Scott told me by phone that only 70% of "stories" (he seems to be unable to utter the word "infomercial") are paid by customers and that they did have independent experts. "We had two experts on the program – two doctors that were experts. We found them. We actually paid them an honorarium, because they were the leading experts in the research of cures for RLS."
I explained that it’s a journalistic no-no. If you pay for interviewees or they pay you in some cases and not in others, how does the public know who to trust? Presumably, when you pay, that person has a financial interest that was not disclosed on the program. He said he was unaware that honorariums are the same as fees.
Doug Scott told Gumbel’s agents that he already has a new pitchman to replace Gumbel. Who ever would that be? I asked and Scott preferred "to not say." But I suspect the latest caller reports citing fraud offer a clue. Here is a victim’s complaint from as recently as Feb 11, 2009.
Anupam - 11 Feb 2009
Same scam ....I must say I was very excited to get this email. And they almost had me scammed. I got suspicious about the return email and found this page. Following is the email I got from them : Sender's address : Tammy Marino [firstname.lastname@example.org]
I am the assistant to Don Pratt, Associate Producer of the national television series "Inside Business." We are currently working on an upcoming segment on "Leading developments in EDA electronic design automation for 21st century applications," and it will be included in a "Report on technology" series.
Mr. Pratt and his team are responsible for determining the most appropriate content for programming based on our editorial calendar, and he would like to arrange a time to speak with you for a brief preliminary conversation. The segment relates to industry trends and how they are helping to address these specific trends. Please email or call to let me know when you would be available to speak via telephone.
The key to the above complaint is the new web site.
Click on the link under "Tammy Marino’s" name. There may be a new company name, US Media Television, but the newsroom-like stage set and graphic animation are nearly identical to the one used for Gumbel.
You may be surprised that the next "pitch" persons (called "hosts") appears to be none other than Fred Thompson, actor and former presidential candidate along with Marilu Henner, "best known as a Broadway, TV and film actress."
imediaethics wrote about Thompson’s other foray into dubious infomercials. Last time it was on the radio and once the relationship to the dubious company was exposed (the owner was a convicted felon), Thompson, as an aspiring presidential candidate, quickly bailed. Spots were just as quickly removed from airwaves after imediaethics and others published damning reports.
Does imediaethics have to do another investigation or will Thompson’s and Henner’s agents, CNN, HLN, Turner, and all the other networks listed by Scott, including Discovery, Travel Channel, CNBC, do their jobs and make sure that these broadcasted infomercials, the press releases and videos on You Tube that misrepresent their brands are properly labeled and truthful according to FTC regulations?
The networks and talent need to take care of business and make sure the public is no longer deceived.
Finally here is some historical context. Alan Bisbort offered the following excerpt from his book, "Media Scandals."
"It Didn't Start with Doug Scott and Greg Gumbel!"
By Alan Bisbort,
Excerpted from Book, Media Scandals:
Infomercials are a hybrid television genre that grew out of a similar hybrid used in print media, "advertorials" (advertisement copy disguised as an article). Infomercials and advertorials appealed to editors and programmers because they filled space that would otherwise require editorial content costing the network (or newspaper) money.
Because media outlets were part of publicly-traded "telecommunications" corporations, owners were more deferential toward shareholders’ demands for higher profits than they were committed to the higher calling of journalism. Infomercials were offered free of charge to the networks; they made money for the infomercial producers from sales generated by their broadcast. Though infomercials are required to be labeled "advertising," they can be so cleverly made that viewers don’t make that distinction.
The self-proclaimed "King of the Infomercial" is Kevin Trudeau, a former car salesman who spent time in prison for credit card fraud. He has also been prosecuted for perpetrating "pyramid schemes" and agreed to a $1 million out-of-court settlement with the Federal Trade Commission for false advertising. After leaving prison in the early 1990s, Trudeau founded the American Memory Institute, a front for his infomercials.
His reputation for salesmanship was made by parlaying products like Mega Memory and Mega Speed Reading—his claims for which defy belief and are impossible to verify—into millions of dollars in sales. His talent was to make infomercials look like actual news broadcasts or network talk shows. One of his techniques was to pretend to talk to guest experts "live via satellite" when, in fact, the "expert" was seated only a few feet away in the studio and filmed on a separate camera.
Though he was required to include disclaimers that his "talk show" was actually an advertisement—lasting anywhere from 25 to 27 minutes, in order that networks can use the segments for standard 30-minute programming slots—Trudeau only did so at the end of the broadcast. His slippery practices were perfected on cable venues like Home Shoppers Network and Shop America.
After years of scrutiny by the FTC—which he described as "extortion of an honest businessman"—Trudeau moved to the more forgiving Internet. He had little choice. In 2004, the FTC banned Trudeau "from appearing in, producing, or disseminating future infomercials that advertise any type of product, service, or program to the public, except for truthful infomercials for informational publications." He also had to pay another $2 million fine.
Alan Bisbort has authored or coauthored 16 books of history, biography, social commentary and poetry and contributed to numerous other books. He has worked for the Library of Congress, on both staff and contract, since 1977. He writes a weekly column for the Advocate newspapers, "The World This Week." His blog, blogbort, can be found at www.hartfordadvocate.com.