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In case you’ve missed it, a bunch of big huge bloggers for Federated Media got paid by Microsoft to mention their new slogan and business, “people ready,” in their blog posts. Nick Denton, owner of Gawker Media, blew up the spot on his tech-blog Valleyway a few days ago and since then, the blogosphere, Microsoft and consumer groups are going loopy. Check out 1938 Media’s CEO Loren Feldman’s funny video response to the scandal. He’s always a little loopy, so be prepared.

Denton’s got his panties in a bunch because these bigwig bloggers like Om Malik and Paul Kedrosky have ruined their credibility for cold hard cash. Well, you know… like this kinda of pay-to-play was bound to be uncovered especially after the whistleblower Jason Calacanis shed light on the Digg scandal and the general do-what-it-takes military attitude of public relations/ad execs. Overall, this is a larger conversation about whether or not bloggers have some sort of Columbia J-School ethos they need to be following and what kind of disclosure is necessary in the Wild West of the blogosphere. In the mean time, be careful how you get those mentions for your brands. Really careful.

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