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According to Ars Technica, Microsoft made a few deals with Machinima's video partners to pay them if they promoted the Xbox One, but only if they kept quiet about the agreement. The Machinima UK community manager tweeted (that has since been deleted) that Microsoft offered to pay $3 per thousand views if their videos included at least 30 seconds of Xbox One gameplay footage in the first two minutes. They also had to specifically state on the video that they were playing on an Xbox One and label the videos with the tag "XB1M13". All videos had to be posted between 3 a.m. EST on January 13th and 2:59 a.m. EST on February 10th. In addition, Microsoft stipulated that the video could not say anything negative about Machinima, the Xbox One, or any of the Xbox One games (check out the full agreement here).
If this is true (and it appears to be so), then Microsoft is in danger with the US Federal Trade Commission, as such confidentiality may violate advertising laws.
Microsoft didn't set aside a huge budget for this stealth marketing plan. They put a cap on the payout at 1.25 million views, only $3,750 total. However, since these videos are still on YouTube, they still garner views, thereby providing free advertising for Microsoft.
It's been suggested that Microsoft probably wanted to try out this method since many people ignore ads or block them completely on websites. However, not being upfront about the endorsement makes it shady all around, no matter the reasoning behind it.
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