- Microsoft hired YouTube network Machinima to recruit YouTube creators to make videos endorsing XBox One, but many of the "native" ads had no disclosure that they were paid endorsements.
- Not providing full disclosure of paid endorsements is in violation of the Federal Trade Commision's endorsement disclosure guidelines, but as of yet, the FTC won't comment on whether there is an investigation.
- Machinima is now working on putting disclosures in the descriptions of all videos, but that may not suffice because the text descriptions are not available everywhere the video could appear.
Because video creators are technically held to the guidelines of Machinima, Microsoft may not be held responsible for the failure to disclose paid endorsement — but with native ads under such scrutiny, it's likely all parties will be held accountable. To prevent blunders like this in the future, Machinima needs to make its rules more explicit about mentioning paid endorsements, and Microsoft needs to take more responsibility for the final spots.