A distinction is useful because it allows people to categorize for themselves what they think is a worthwhile sponsership. It's adding information to the market which wasn't present (or was hard to acquire) beforehand, which is always useful.
For a simple example, imagine an endorsement of makeup by Kim Kardashian, and a shop tool by Adam Savage. Initially you believe they are using the products because they like them and think they work well. Now you learn they were paid endorsements. Do you provide the same level of confidence to the suggestions of these two people based on paid endorsements that you do if they are not paid for those endorsements? I don't. One of them I trust to care about their integrity and reputation with respect to this, the other I do not.
> I also don't see why a "#sponsored" hash tag is not enough. Anyone who cares can understand hash tags.
Because the whole world isn't twitter, and hash tags don't always make sense. how do you hash tag a segment of a podcast?