Microsoft reportedly made deals with several Machinima video partners for extra pay, provided they promote Xbox One without mentioning any endorsement from the firm.
A piece on Ars Technica alleges that the terms of the promotion included an extra $3 per thousand views bonus from Microsoft to video producers highlighting Xbox One content for at least 30 seconds in the first two minutes of a video. The producers were also asked to verbally mention that they were playing on an Xbox One console.
The terms were supposedly posted and subsequently deleted by Machinima's UK community manager. The report also claims Microsoft's confidentiality requirement may violate the U.S. Federal Trade Commission's guidelines for advertising that contains endorsements.
"When there exists a connection between the endorser and the seller of the advertised product that might materially affect the weight or credibility of the endorsement (i.e., the connection is not reasonably expected by the audience), such connection must be fully disclosed," the guidelines state.
Both Microsoft and Machinima have yet to release any comment on the allegations.