[Federal Register Volume 64, Number 137 (Monday, July 19, 1999)]
[Proposed Rules]
[Pages 38610-38616]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-18302]


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FEDERAL TRADE COMMISSION

16 CFR Part 432


Trade Regulation Rule Relating to Power Output Claims for 
Amplifiers Utilized in Home Entertainment Products

AGENCY: Federal Trade Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Trade Commission (``Commission'' or ``FTC''), is 
commencing a rulemaking proceeding to amend its Rules relating to Power 
Output Claims for Amplifiers Utilized in Home Entertainment Products 
(the ``Amplifier Rule'' or the ``Rule''). The Commission proposes 
amending the Rule to: exempt sellers who make power output claims in 
media advertising from the requirement to disclose total rated harmonic 
distortion and the associated power bandwidth and impedance ratings; 
clarify the manner in which the Rule's testing procedures apply to 
self-powered subwoofer-satellite combination speaker systems; and 
reduce the preconditioning power output requirement from one-third of 
rated power to one-eighth of rated power. The Commission is commencing 
this rulemaking because of the comments filed in response to its 
Advanced Notice of Proposed Rulemaking (``ANPR''), and other 
information discussed in this notice. The notice includes a description 
of the procedures to be followed, an invitation to submit written 
comments, a list of questions and issues upon which the Commission 
particularly desires comments, and instructions for prospective 
witnesses and other interested persons who desire to participate in a 
hearing where oral testimony could be presented.

DATES: Written comments must be submitted on or before September 17, 
1999. Notifications of interest in testifying must be submitted on or 
before September 17, 1999. If interested parties request the 
opportunity to present testimony, the Commission will publish a 
document in the Federal Register, stating the time and place at which 
the hearings will be held and describing the procedures that will be 
followed in conducting the hearings. In addition to submitting a 
request to testify, interested parties who wish to present testimony 
must submit, on or before September 17, 1999, a written comment or 
statement that describes the issues on which the party wishes to 
testify and the nature of the testimony to be given. If there is no 
interest in a hearing, the Commission will base its decision on the 
written rulemaking record.

ADDRESSES: Written comments and requests to testify should be submitted 
to Office of the Secretary, Federal Trade Commission, Room H-159, 600 
Pennsylvania Ave., NW., Washington, DC 20580. Comments and requests to 
testify should be identified as ``16 CFR Part 432 Comment--Amplifier 
Rule'' and ``16 CFR Part 432 Request to Testify--Amplifier Rule,'' 
respectively. If possible, submit comments both in writing and on a 
personal computer diskette in Word Perfect or other word processing 
format (to assist in processing, please identify the format and version 
used). Written comments should be submitted, when feasible and not 
burdensome, in five copies.

FOR FURTHER INFORMATION CONTACT: Dennis Murphy, Economist, Division of 
Consumer Protection, Bureau of Economics, (202) 326-3524, or Neil 
Blickman, Attorney, Division of Enforcement, Bureau of Consumer 
Protection, (202) 326-3038, Federal Trade Commission, Washington, DC 
20580.

SUPPLEMENTARY INFORMATION:

Part A--Introduction

    This Notice of Proposed Rulemaking (``NPR'') is being published 
pursuant to section 18 of the Federal Trade Commission (``FTC'') Act, 
15 U.S.C. 57a et seq., the provisions of part 1, subpart B of the 
Commission's rules of practice, 16 CFR 1.7, and 5 U.S.C. 551 et seq. 
This authority permits the Commission to promulgate, modify, and repeal 
trade regulation rules that define with specificity acts or practices 
that are unfair or deceptive in or affecting commerce within the 
meaning of section 5(a)(1) of the FTC Act, 15 U.S.C. 45(a)(1). The 
Commission is undertaking this rulemaking proceeding as part of the 
Commission's ongoing program of evaluating trade regulation rules and 
industry guides to determine their effectiveness, impact, cost and 
need.\1\
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    \1\ In accordance with section 18 of the FTC Act, 15 U.S.C. 57a, 
the Commission submitted this NPR to the Chairman of the Committee 
on Commerce, Science, and Transportation, Untied States Senate, and 
the Chairman of the Committee on Commerce, United States House of 
Representatives, 30 days prior to its publication in the Federal 
Register.
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    The Amplifier Rule was promulgated on May 3, 1974 (39 FR 15387), to 
assist consumers in purchasing power amplification equipment for home 
entertainment purposes by standardizing the measurement and disclosure 
of various performance characteristics of the equipment. On April 7, 
1997, the Commission published a Federal Register Notice (``FRN'') 
seeking comment on the rule as part of an ongoing project to review all 
Commission rules and guides to determine their current effectiveness 
and impact (62 FR 16500). This FRN sought comment on the costs and 
benefits of the Rule, what changes in the Rule would increase its 
benefits to purchasers and how those changes would affect compliance 
costs, and whether technological or marketplace changes have affected 
the Rule. The FRN also sought comment on issues related to the Rule's 
product coverage,

[[Page 38611]]

test procedures,and disclosure requirements.
    The comments in response to the FRN generally expressed continuing 
support for the Rule, stating that it has given consumers a 
standardized method of comparing the power output of audio amplifiers, 
and has created a level playing field among competitors. The comments 
also suggested that there have been technological and marketplace 
changes that may warrant modifications to the Rule's testing and 
disclosure requirements, and a clarification of the Rule's 
applicability to self-powered loudspeakers for use with personal 
computers and home stereo systems. Certain comments also recommended 
that the Commission expand the Rule's coverage to include automotive 
sound amplification products. On the basis of this review, the 
Commission determined to retain the Rule, but to seek additional 
comment on possible amendments to the Rule.
    The Commission published an Advanced Notice of Proposed Rulemaking 
(``ANPR'') on July 9, 1998 (63 FR 37238), seeking public comment on 
whether it should initiate a rulemaking proceeding by publishing a 
Notice of Proposed Rulemaking (``NPR'') under section 18 of the FTC 
Act, 15 U.S.C. 57a. The ANPR solicited specific comment on whether the 
Commission should (1) eliminate certain disclosure requirements in 
media advertising; (2) clarify testing procedures for self-powered 
speakers; and (3) amend certain required test procedures that may 
impose unnecessary costs on manufacturers. The ANPR also announced that 
the Commission had determined not to initiate a proceeding to amend the 
Rule to cover power ratings for automotive sound amplification 
equipment. Finally, the Commission published elsewhere in the July 9, 
Federal Register a Notice of Final Action announcing a non-substantive 
technical amendment to the Rule clarifying that the Rule covered self-
powered loudspeakers for use in the home (63 FR 37234).
    The ANPR elicited five written comments on the possible amendments 
described therein.\2\ Based on the comments and the evidence discussed 
below, the Commission proposes to amend the Rule in the following ways.
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    \2\ The commenters were: Consumer Electronics Manufacturers 
Association (CEMA)(1); Wass AudioDigital (Wass)(2); 
Sonance (Sonance)(3); PHI Acoustics (PHI)(4), and Velodyne 
Acoustics, Inc. (Velodyne)(5). The comments are cited as ``(name of 
commenter), Comment (designated number), p. __.'' All Rule ANPR 
comments are on the public record and are available for public 
inspection in the Public Reference Room, Room 130, Federal Trade 
Commission, 600 Pennsylvania Ave., NW, Washington, DC, from 8:30 
a.m. to 5 p.m., Monday through Friday, except federal holidays.
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Part B--Analysis of Proposed Amendments

1. Proposed Amendment to Required Disclosures Section of the Amplifier 
Rule

a. Background
    Section 432.2 of the Rule requires disclosure of maximum rated 
total harmonic distortion (``THD''), power bandwidth, and impedance 
whenever a power claim is made in any advertising, including 
advertising by retail stores, direct mail merchants, and manufacturers. 
In the ANPR, the Commission concluded tentatively that improvements in 
amplifier technology since the Rule's promulgation in 1974 appeared to 
have reduced the benefits to consumers of disclosure of THD in medic 
advertising in the ANPR, the Commission also concluded tentatively that 
an insufficient number of consumers would understand the meaning and 
significance of the remaining triggered disclosures concerning power 
bandwidth and impedance to justify their publication in media 
advertising. Accordingly, the ANPR sought comment on whether the 
Commission should initiate a rulemaking proceeding to amend the Rule to 
exempt media advertising, including advertising on the Internet, from 
disclosure of THD and the associated power bandwidth and impedance 
ratings when a power output claim is made. In the ANPR, the Commission 
tentatively concluded further that the proposed exemption should be 
conditioned on the requirement that the primary power output 
specification disclosed in any advertising distributed through the 
media be the manufacturer's rated minimum sine wave continuous average 
power output, per channel, at an impedance of 8 ohms, or, if the 
amplifier is not designed for an 8-ohm impedance, at the impedance for 
which the amplifier is primarily designed.
    Finally, the ANPR explained the Commission's tentative conclusion 
that publication of all other power output claims currently subject to 
the Rule, including those appearing in manufacturer specification 
sheets that are either in print or reproduced on the Internet, should 
continue to trigger the requirement that the seller provide the full 
complement of disclosures concerning power bandwidth, maximum harmonic 
distortion, and impedance, so that interested consumers could obtain 
this information prior to purchase.
    The Commission received four comments on the tentatively proposed 
exemption of THD, bandwidth, and impedance disclosures in media 
advertising. CEMA, the principal trade association for the electronics 
industry, supported the proposed exemption, including the requirement 
that the primary power output specification disclosed in media 
advertising be continuous per-channel output at an 8-ohm impedance 
(unless the amplifier is designed primarily for a different impedance 
level).\3\ Velodyne, a manufacturer of powered loudspeakers, also 
supported the exemption of THD and bandwidth disclosures in media 
advertising, stating that they contain little useful information for 
today's consumer.\4\ This commenter suggested, however,that the 
standardized impedance value for power output claims be 4 ohms rather 
than the proposed 8 ohms.\5\ No explanation was provided for this 
suggestion. A third commenter, Wass, opposed elimination of the 
required THD, bandwidth, and impedance disclosures in advertising, 
stating that sellers could take unfair advantage of the consumer 
through in-store sales techniques that obscure the true performance 
capabilities of an amplifier.\6\ Finally, a fourth commenter, Sonance, 
stated simply that the relationship between power and distortion is 
vital to specifying power output, and recommended against the 
tentatively proposed exemption.\7\
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    \3\ CEMA, (1), pp. 2-3.
    \4\ Velodyne, (5) p. 1.
    \5\ Id.
    \6\ Wass, (2), p. 3.
    \7\ Sonance, (3), p. 1.
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b. Proposed Amendment and Reasons Therefore
    Based on its review of the comments on its ANPR, the Commission has 
reason to believe that the disclosure of THD, power bandwidth, and 
impedance in media advertising that contains a triggering power output 
claim no longer provides sufficient consumer benefit to justify the 
associated increase in advertising costs. Two of the commenters stated 
that the disclosures were of little value. Two commenters opposed the 
tentatively proposed exemption, with one expressing concern that 
eliminating the disclosure requirements in media advertising would 
allow sales personnel to take advantage of consumers at retail stores. 
As the Commission noted in the ANPR, however, very few amplifiers in 
today's market generate high levels of THD (e.g., more than one 
percent) using the FTC testing protocol. Further, those few

[[Page 38612]]

amplifiers that do generate appreciable levels of THD tend to be very 
expensive vacuum tube designs that are sold to a specialized group of 
consumers that may not consider THD specifications an important 
consideration in their purchase decisions. Thus, it would not appear 
that sales personnel at retail stores would have an appreciable 
incentive to mislead consumers concerning the distortion 
characteristics of an amplifier. Finally, consumers who are interested 
in the Rule's THD, power bandwidth, and impedance specifications should 
be able to find such information relatively easily in product brochures 
at retail stores or on the Internet.
    Commenters on the ANPR did not agree on which impedance value 
should serve as the standard for power output claims in media 
advertising under the tentatively proposed disclosure exemption. CEMA 
endorsed the value of 8 ohms suggested in the ANPR. Velodyne, however, 
commented that the standardized impedance value should be 4 ohms. The 
Commission notes that, under the proposed exemption, for amplifiers 
designed to drive a specific loudspeaker in an integrated powered 
configuration, the seller could base power output claims on an 
impedance of 4 ohms, if the amplifier is powering a loudspeaker that is 
rated at a nominal impedance of 4 ohms. Although the Commission has 
reason to believe that the majority of non-powered loudspeakers are 
rated at a nominal impedance of 8 ohms, and that this value should 
therefore be adopted as the basis for power output claims in media 
advertising for separate stand-alone amplifiers, this NPR solicits 
further comment on whether the Commission's tentative conclusion on 
this issue is correct.
    Accordingly, the Commission proposes amending Sec. 432.2 of the 
Rule to exempt advertising disseminated through the media, including 
advertising on the Internet, from disclosure of total rated harmonic 
distortion and the associated power bandwidth and impedance ratings 
when a power output claim is made. The exemption for advertising 
disseminated through the media would be conditioned on the requirement 
that the primary power output specification disclosed in any media 
advertising be the manufacturer's rated minimum sine wave continuous 
average power output, per channel, at an impedance of 8 ohms, or, if 
the amplifier is not designed for an 8-ohm impedance, at the impedance 
for which the amplifier is primarily designed. Publication of all other 
power output claims currently subject to the Rule, including those 
appearing in manufacturer specification sheets that are either in print 
or reproduced on the Internet, would continue to trigger the 
requirement that the seller provide the full complement of disclosures 
concerning power bandwidth, maximum harmonic distortion, and impedance, 
so that interested consumers could obtain this information prior to 
purchase.

2. Proposed Amendment Relating to Self-Powered Loudspeakers

a. Background
    When the FRN was published, the Rule did not specifically mention 
self-powered speakers as an example of sound amplification equipment 
manufactured or sold for home entertainment purposes. In the FRN, the 
Commission solicited comment on its tentative conclusion that the Rule 
covers: (A) Self-powered speakers for use with (i) home computers, (ii) 
home sound systems, (iii) home multimedia systems; and (B) other sound 
power amplification equipment for home computers. On July 9, 1998, the 
Commission published in the Federal Register a non-substantive 
technical amendment to the Rule to clarify that the Rule applies to the 
types of self-powered loadspeakers enumerated above (63 FR 37234).
    In the ANPR published elsewhere in the July 9, 1998 Federal 
Register (63 FR 37238), the Commission explained that comments received 
in response to the FRN indicated that a clarification was needed 
concerning the testing procedure that should be followed in applying 
the Rule's continuous power rating protocol to self-powered subwoofer-
satellite combination speaker systems that employ two or more power 
amplifiers sharing a common power supply. These comments contained 
recommendations for two alternative approaches for such combination 
self-powered speakers. The first proposed procedure was for power 
measurements to be made with all associated channels of both the 
subwoofer and satellite amplifiers driven simultaneously to full power 
using a test tone at the system's crossover frequency. The second 
proposal was to allow manufacturers of such equipment to test the 
subwoofer and satellite amplifiers separately over their respective 
frequency bandwidth.
    In the ANPR, the Commission announced its tentative conclusion that 
the second procedure was more appropriate, given the types of power 
demands combination self-powered speakers would most likely encounter 
in actual home use. Accordingly, in the ANPR the Commission sought 
comment on whether to initiate a rulemaking proceeding to clarify the 
Amplifier Rule by amending Sec. 432.2 of the Rule to included a note 
stating that, for self-powered combination speaker systems that employ 
two or more amplifiers dedicated to different portions of the audio 
frequency spectrum, only those channels dedicated to the same audio 
frequency spectrum need be fully driven to rated per channel power 
under Sec. 432.2(a)(2).
    The Commission received three comments on the tentatively proposed 
clarification of testing procedures for self-powered combination 
subwoofer-satellite loudspeaker systems. CEMA supported the 
Commission's clarification. CEMA stated that this approach would allow 
self-powered subwoofers to be rated over their operating frequency 
range and at their appropriate impedance value.\8\ Sonance also 
endorsed the tentative proposal to restrict the power tests of such 
equipment to each amplifier's intended operating range.\9\ The final 
commenter, Velodyne, disagreed with the Commission's tentative proposal 
and stated that power rating tests for self-powered combination 
subwoofer-satellite loudspeakers should be conducted with all channels 
operating simultaneously. Velodyne proposed that the amplifiers driving 
the subwoofer and satellites should be given a test signal within each 
amplifer's typical range, and suggested a combination 60Hz-1,000Hz 
tone.\10\ Velodyne stated that the power supply was the most costly and 
critical component determining an amplifier's continuous power output 
capability, and that the primary quantitative measurement of interest 
to consumers is the amount of watts the power supply can deliver.\11\
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    \8\ CEMA, (1), p. 3.
    \9\ Sonance, (3), p. 1.
    \10\ Velodyne, (5), p. 3.
    \11\ Id.
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b. Proposed Amendment and Reasons Therefore
    Based on the comments submitted in response to the FRN and the 
ANPR, the Commission tentatively concludes that the most appropriate 
method of testing self-powered combination subwoofer-satellite 
loudspeaker systems under the Rule is to require simultaneous operation 
only of those channels dedicated to the same portion of the audio 
frequency spectrum. As noted in the ANPR, the Commission does not have 
sufficient evidence to concluded that in-home use, under even strenuous 
conditions, typically would place

[[Page 38613]]

maximum continuous power demands simultaneously on both the subwoofer 
and satellite amplifiers at the crossover frequency. Rather, it is the 
Commission's understanding that such demands are more likely to occur 
in portions of the audio spectrum that would be assigned primarily 
either to the subwoofer amplifier or the satellite amplifier. In 
contrast, conventional stand-alone stereo amplifiers, which incorporate 
left and right-channel amplifiers that must reproduce signals covering 
the full musical frequency bandwidth, will more commonly be required to 
meet simultaneous continuous power demands that are present in both 
channels (such as might occur when a pipe organ play a sustained pedal 
tone in the deep bass.
    In addition, a simultaneous power test of both the subwoofer and 
the satellite amplifiers would, from a practical standpoint, require a 
single test signal at the crossover frequency, or a single combination 
set of tones, such as the 60Hz-1,000Hz composite signal suggested by 
Velodyne. This would mean that the resulting power and THD 
specifications might not be valid over the full frequency range over 
which each amplifier was designed to operate.
    Accordingly, the Commission proposed amendment 432.2(a)(2) of the 
Rule to include a clarifying note stating that, when measuring maximum 
per channel output of self-powered combination speaker systems that 
employ two or more amplifiers dedicated to different portions of the 
audio frequency spectrum, only those channels dedicated to the same 
audio frequency spectrum need be fully driven to rated per channel 
power.

3. Proposed Amendment to the Amplifier Rule Preconditioning Requirement

a. Background
    Section 432.3(c) of the Rule specifies that an amplifier must be 
preconditioned by simultaneously operating all channels at one-third of 
rated power output for one hour using a sinusoidal wave at a frequency 
of 1,000Hz. The ANPR sought comment on whether the Commission should 
amend the Rule to reduce the preconditioning power output requirement 
from one-third of rated power to a lower figure, such as one-eighth of 
rated power.
    CEMA supported reducing the preconditioning power output 
requirement to below the current one-third power. CEMA stated that the 
current one-third power requirement is ``beyond what can be expected 
through normal use in the home'' and is ``harsh and unrealistic.'' \12\ 
CEMA claimed that in order to meet the physical conditions presented by 
the Rule's existing preconditioning requirement, manufacturers must 
design and incorporate in amplifiers larger and costlier heat 
sinks.\13\ CEMA listed several alternative solutions, including 
operation at idle during preconditioning, operation at a small fixed 
power representative of average power during typical in-home operation, 
or preconditioning at one-eighth power. CEMA went on to state that the 
one-eighth power option ``has the virtue of being consistent with 
current industry and international testing specification.'' \14\
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    \12\ CEMA, (1), p. 2
    \13\ Id.
    \14\ Id.
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    A second commenter, Velodyne, stated that a preconditioning period 
is not really necessary, but that the Commission should follow 
Underwriters Laboratories' (``UL'') one-eighth power requirement if the 
preconditioning requirement is retained.\15\ Velodyne did not provide 
any explanation for its conclusion that no preconditioning period of 
any kind was necessary under the Rule.
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    \15\ Velodyne, (5), p. 1.
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    A third commenter, Wass, concluded from a series of calculations 
that reducing the preconditioning requirement from one-third to one-
eighth power would reduce the thermal stress (expressed in ``watts of 
heat'' delivered to an amplifer's heatsink) by approximately 24 
percent.\16\ Wass, however, opposed amending the Rule to provide such a 
reduction in specified preconditioning power output because the 
consumer would get ``a poorer unit.'' \17\ Wass did not provide any 
evidence, however, that would allow the Commission to compare the 
magnitude of the alleged reduction in amplifier quality with the 
magnitude of the associated reduction in manufacturing costs resulting 
from the one-eighth power preconditioning standard.
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    \16\ Wass, (2), p. 2.
    \17\ Id.
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    Finally, a fourth commenter, Sonance, stated that the one-third 
power preconditioning requirement should be retained and enforced 
evenly.\18\ Sonance saw no technical problem with the requirement, 
stating that many generations of consumer electronic products have been 
built to this standard.\19\
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    \18\ Sonance, (3), p. 1.
    \19\ Id.
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b. Proposed Amendment and Reasons Therefore
    Based on the aforementioned comments, the Commission tentatively 
concludes that the current one-third power preconditioning requirement 
imposes unnecessary costs on amplifier manufacturers and is not needed 
to measure amplifiers accurately under conditions that represent actual 
in-home use. Two of the commenters, including the principal trade 
association for the electronics industry, did not believe that there 
was any benefit to consumers that would justify the increased heat-sink 
capacity needed to withstand the current preconditioning requirement. A 
third commenter provided evidence that lowering the preconditioning 
requirement to one-eighth power would in fact reduce thermal stress 
significantly, and thus allow manufacturers to provide less costly heat 
sink capacity.
    None of the commenters provided any evidence that lowering the 
preconditioning standard to one-eighth power, or some other value, 
would lead to a reduction in the actual in-home performance 
capabilities of amplifiers. In addition, both commenters that supported 
a reduction in the preconditioning power-output requirement either 
recommended the UL's one-eighth-power preconditioning standard 
explicitly, or considered the UL standard an acceptable choice among 
several alternatives.
    Accordingly, the Commission proposes amending Sec. 432.3(c) of the 
Rule by reducing the specified per-channel power output during 
preconditioning from one-third of rated power output for one hour to 
one-eighth of rated power output for one hour.
c. Additional Preconditioning Issue and Proposed Amendment
    As discussed in Part B(2) above, the Commission is proposing to 
amend the Rule to clarify the manner in which power tests should be 
conducted for self-powered subwoofer-satellite combination loudspeaker 
systems. In reviewing the technical issues related to this proposed 
amendment, the Commission has tentatively concluded that clarification 
also is required concerning the manner in which powered subwoofers 
should be preconditioned under the Rule.
    Section 432.3(c) of the Rule specifies a preconditioning sinusoidal 
test tone of 1,000Hz. Most self-powered subwoofer systems, however, 
incorporate crossover circuitry that filters out frequencies above the 
bass range. Depending upon the crossover frequency and the

[[Page 38614]]

steepness of the crossover slope, such crossover circuitry may severely 
attenuate a test tone of 1,000Hz and prevent the subwoofer amplifier 
from being driven to one-third of rated power (as currently required by 
the Rule), or even to one-eighth of rated power (as specified in the 
proposed amendment). Thus, it would appear that testers of self-powered 
subwoofers would need to select a preconditioning frequency 
considerably lower than 1,000Hz.
    The Commission, therefore, has tentatively concluded that the Rule 
should be amended to clarify the preconditioning procedure for self-
powered subwoofers. The Commission does not currently believe, however, 
that any such amendment should specify the precise frequency of the 
test tone that is to be used in preconditioning powered subwoofers. 
Powered subwoofers may differ widely in the portion of the bass 
spectrum over which they are designed to operate, and, consequently, 
there may not be a single preconditioning frequency that is appropriate 
for all powered subwoofers. The Commission has tentatively concluded, 
therefore, the testers of powered subwoofers should have the 
flexibility to choose for the sinusoidal preconditioning signal any 
frequency (within the intended operating bandwidth of the subwoofer 
amplifier) that will allow the amplifier to be driven for one hour to 
the required proportion of rated power output.
    Accordingly, the Commission proposes amending Sec. 432.3(c) of the 
Rule by adding an explanatory note stating that for amplifiers utilized 
as a component in a self-powered subwoofer system, the sinusoidal wave 
used as a preconditioning signal may be any frequency within the 
amplifier's intended operating bandwidth that will allow the amplifier 
to be driven to one-eighth of rated power for one hour.

Part C--Rulemaking Procedures

    The Commission finds that the public interest will be served by 
using expedited procedures in this proceeding. Using expedited 
procedures will support the Commission's goals of clarifying existing 
regulations, when necessary, and eliminating obsolete or unnecessary 
regulation without an undue expenditure of resources, while ensuring 
that the public has an opportunity to submit data, views and arguments 
on whether the Commission should amend the Rule.
    The Commission, therefore, has determined, pursuant to 16 CFR 1.20, 
to use the procedures set forth in this notice. These procedures 
include: (1) Publishing this Notice of Proposed Rulemaking; (2) 
soliciting written comments on the Commission's proposals to amend the 
Rule; (3) holding an informal hearing, if requested by interested 
parties; (4) obtaining a final recommendation from staff; and (5) 
announcing final Commission action in a notice published in the Federal 
Register.

Part D--Requests for Public Hearings

    Because written comments appear adequate to present the views of 
all interested parties, a public hearing has not been scheduled. If any 
person would like to present testimony at a public hearing, he or she 
should follow the procedures set forth in the DATES and ADDRESSES 
sections of this notice.

Part E--Section-by-Section Description of Proposed Amendments

1. Amendment Relating to Exemption from Required Disclosures in Media 
Advertising

    The Commission proposes to amend Sec. 432.2 to exempt media 
advertising, including advertising on the Internet, from disclosure of 
maximum total rated harmonic distortion, power bandwidth, and load 
impedance. This exemption would be conditioned on the requirement that 
the primary power output specification disclosed in any media 
advertising be the manufacturer's rated minimum sine wave continuous 
average power output, per channel, at an impedance of 8 ohms, or, if 
the amplifier is not designed for an 8-ohm impedance, at the impedance 
for which the amplifier is primarily designed. All other power output 
claims currently subject to the Rule, including those appearing in 
manufacturer specification sheets that are either in print or 
reproduced on the Internet, would continue to trigger the full 
complement of disclosures concerning power bandwidth, maximum rated 
harmonic distortion, and impedance.

2. Clarifying Amendment Relating to Testing Procedures for Self-Powered 
Speakers

    The Commission proposes to amend Sec. 432.2(a) by adding a 
clarifying note stating that, for self-powered combination speaker 
systems that employ two or more amplifiers dedicated to different 
portions of the audio frequency spectrum, only those channels dedicated 
to the same audio frequency spectrum need be fully driven 
simultaneously to rated per channel power.

3. Amendments Relating to Preconditioning

    The Commission proposes to amend Sec. 432.3(c) to read as follows:

    The amplifier shall be preconditioned by simultaneously 
operating all channels at one-eighth of rated power output for one 
hour using a sinusoidal wave at a frequency of 1,000Hz;

    The Commission also proposes to amend Sec. 432.3(c) by adding an 
explanatory note stating that, for amplifiers utilized as a component 
in a self-powered subwoofer system, the sinusoidal wave used as a 
preconditioning signal may be any frequency within the amplifier's 
bandwidth that will allow the amplifier to be driven to one-eighth of 
rated power for one hour.

Part F--Preliminary Regulatory Analysis and Regulatory Flexibility 
Act Requirements

    Under section 22 of the FTC Act, 15 U.S.C. 57b, the Commission must 
issue a preliminary regulatory analysis for a proceeding to amend a 
rule only when it (1) estimates that the amendment will have an annual 
effect on the national economy of $100,000,000 or more; (2) estimates 
that the amendment will cause a substantial change in the cost or price 
of certain categories of goods or services; or (3) otherwise determines 
that the amendment will have a significant effect upon covered entities 
or upon consumers. The Commission has preliminarily determined that the 
proposed amendments to the Rule will not have such effects on the 
national economy, on the cost of sound amplification equipment, or on 
covered businesses or consumers. The Commission, however, requests 
comment on the economic effects of the proposed amendments.
    The Regulatory Flexibility Act (``RFA''), 5 U.S.C. 601-12, requires 
that the agency conduct an analysis of the anticipated economic impact 
of the proposed amendments on small businesses. The purpose of a 
regulatory flexibility analysis is to ensure that the agency considers 
impact on small entities and examines regulatory alternatives that 
could achieve the regulatory purpose while minimizing burdens on small 
entitles. Section 605 of the RFA, 5 U.S.C. 605, provides that such an 
analysis is not required if the agency head certifies that the 
regulatory action will not have a significant economic impact on a 
substantial number of small entities.
    Because the Amplifier Rule covers manufacturers and importers of 
power amplification equipment for use in the

[[Page 38615]]

home, the Commission believes that any amendment to the Rule may affect 
a substantial number of small businesses. Nevertheless, the proposed 
amendments would not appear to have a significant economic impact upon 
such entities. Specifically, the proposed change in the preconditioning 
protocol and the proposed exemption of disclosure of THD, bandwidth, 
and impedance specifications in media advertising should allow a 
moderate reduction in amplifier manufacturing and advertising costs 
that should benefit both small and larger businesses. The proposed 
clarification of testing procedures for combination subwoofer-satellite 
self-powered loudspeaker systems is the least burdensome application of 
the Rule among the alternative proposals suggested by commenters, and 
should not have a significant disproportionate impact on the testing 
costs of small manufacturers of such power amplification equipment.
    Based on available information, therefore, the Commission certifies 
that amending the Amplifier Rule as proposed will not have a 
significant economic impact on a substantial number of small 
businesses. To ensure that no significant economic impact is being 
overlooked, however, the Commission requests comments on this issue. 
The Commission also seeks comments on possible alternatives to the 
proposed amendments to accomplish the stated objectives. After 
reviewing any comments received, the Commission will determine whether 
a final regulatory flexibility analysis is appropriate.

Part G--Paperwork Reduction Act

    The Amplifier Rule contains various information collection 
requirements for which the Commission has obtained clearance under the 
Paperwork Reduction Act, 44 U.S.C. 3501 et seq., Office of Management 
and Budget (``OMB'') Control Number 3084-0105. As noted above, for 
purposes of performing the tests necessary for affected entities to 
make the disclosures required under the Rule, Sec. 432.3(c) of the 
Rules requires that an amplifier be preconditioned by simultaneously 
operating all channels at one-third of rated power output for one hour 
using a sinusoidal wave at a frequency of 1,000Hz. In addition, 
Sec. 432.2 of the Rules requires disclosure of the manufacturer's rated 
minimum sine wave continuous average power output, in watts per 
channel, maximum rated total harmonic distortion, power bandwidth, and 
impedance whenever a power claim is made in advertising, including 
advertising by retail stores, direct mail merchants, and manufacturers.
    The proposed amendments would not increase the paperwork burden 
associated with the aforementioned paperwork requirements. Three of the 
amendments proposed by the Commission would not increase or alter the 
Rule's paperwork requirements, and one amendment proposed by the 
Commission would reduce the paperwork burden for businesses. 
Consequently, there are no additional ``collection of information'' 
requirements included in the proposed amendments to submit to OMB for 
clearance under the Paperwork Reduction Act. A separate Notice 
soliciting public comment on extending the OMB clearance for the Rule 
through March 31, 2002, was published in the Federal Register on 
January 8, 1999 (64 FR 1203). If, as expected, OMB extends clearance 
for the Rule as presently written, any reduction of the paperwork 
burden associated with the Rule's requirements that may result from 
this proceeding will be reflected in subsequent reviews of the Rule for 
OMB clearance.
    The Commission's proposed amendment to reduce the specified per-
channel power output of amplifiers during preconditioning from one-
third of rated power output for one hour to one-eighth of rated power 
output for one hour would not alter or increase the paperwork burden 
associated with this requirement because amplifiers must continue to be 
preconditioned for one hour. Also, with respect to preconditioning, the 
proposed amendment to add a note to the Rule stating that, for 
amplifiers utilized as a component in a self-powered subwoofer system, 
the sinusoidal wave used as a preconditioning signal may be any 
frequency within the amplifier's intended operating bandwidth that will 
allow the amplifier to be driven to one-eighth of rated power for one 
hour, would not increase the Rule's paperwork burden. The note would 
not change the Rule's requirements, but merely would clarify the 
preconditioning procedure for self-powered subwoofers.
    Similarly, the proposed amendment to add a note to the Rule stating 
that, for self-powered combination speaker systems that employ two or 
more amplifiers dedicated to different portions of the audio frequency 
spectrum, only those channels dedicated to the same audio frequency 
spectrum need be fully driven to rated per channel power also would not 
increase the Rule's paperwork burden. The note would not alter the 
Rule's requirements, but merely would clarify the test procedure that 
should be followed in applying the Rule's continuous power rating 
protocol to self-powered subwoofer-satellite combination speaker 
systems that employ two or more power amplifiers sharing a common power 
supply.
    The proposed amendment of the Rule to exempt from media 
advertising, including advertising on the Internet, disclosure of an 
amplifier's total rated harmonic distortion and the associated power 
bandwidth and impedance ratings when a power output claim for an 
amplifier is made would result in reducing the Rule's paperwork burden. 
Although the exemption for media advertising would be conditioned on 
the requirement that the amplifier's primary power output specification 
continue to be disclosed in any media advertising, the net effect of 
the proposed amendment would be to reduce the Rule's paperwork burden 
for businesses.
    Thus, the Commission concludes that the proposed amendments would 
not increase the paperwork burden associated with compliance with the 
Rule. To ensure that no significant paperwork burden is being 
overlooked, however, the Commission requests comments on this issue.

Part H--Additional Information for Interested Persons

1. Motions or Petitions

    Any motions or petitions in connection with this proceeding must be 
filed with the Secretary of the Commission.

2. Communications by Outside Parties to Commissioners or Their Advisors

    Pursuant to Commission Rule 1.18(c)(1), 16 CFR 1.18(c)(1), the 
Commission has determined that communications with respect to the 
merits of this proceeding from any outside party to any Commissioner or 
Commissioner advisor shall be subject to the following treatment. 
Written communications and summaries or transcripts of oral 
communications shall be placed on the rulemaking record if the 
communication is received before the end of the comment period. They 
shall be placed on the public record if the communication is received 
later. Unless the outside party making an oral communication is a 
member of Congress, such communications are permitted only if advance 
notice is published in the Weekly Calendar and Notice of ``Sunshine'' 
Meetings.\20\
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    \20\ See 15 U.S.C. 57a(i)(2)(A); 45 FR 50814 (1980); 45 FR 78626 
(1980).

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[[Page 38616]]

Part I--Invitation to Comment and Questions for Comment

    Members of the public are invited to comment on any issues or 
concerns they believe are relevant or appropriate to the Commission's 
consideration of proposed amendments to the Amplifier Rule. The 
Commission requests that factual data upon which the comments are based 
be submitted with the comments. In addition to the issues raised above, 
the Commission solicits public comment on the costs and benefits to 
industry members and consumers of each of the proposals, as well as the 
specific questions identified below. These questions are designed to 
assist the public and should not be construed as a limitation on the 
issues on which public comment may be submitted.
    The written comments submitted will be available for public 
inspection in accordance with the Freedom of Information Act, 5 U.S.C. 
552, and Commission regulations, on normal business days between the 
hours of 8:30 a.m. to 5 p.m. at the Federal Trade Commission, 600 
Pennsylvania Ave., NW, Room 130, Washington, DC 20580, (202) 326-2222.

Questions

A. Exemption From Rule-Required Disclosures in Media Advertising

    (1) Should the Commission amend Sec. 432.2 of the Rule to exempt 
disclosure of total rated harmonic distortion and the associated power 
bandwidth and impedance ratings when a power output claim is made in 
media advertising?
    (2) If the Commission amends the Rule to allow the above exemption, 
should this exemption be conditioned on the requirement that the 
primary power output specification disclosed in any media advertising 
be the manufacturer's rated minimum sine wave continuous average power 
output, per channel, at an impedance of 8 ohms, or, if the amplifier is 
not designed primarily for an 8-ohm impedance, at the impedance for 
which the amplifier is primarily designed?
    (3) What is the most common nominal impedance rating for the 
majority of home loudspeakers that are designed to be driven 
conventionally by separate sound amplification equipment?

B. Rule Coverage of Self-Powered Loudspeakers for Use in the Home

    (4) Should the Commission amend Sec. 432.2(a) of the Rule to 
clarify that, for self-powered combination speaker systems that employ 
two or more amplifiers dedicated to different portions of the audio 
frequency spectrum, only those channels dedicated to the same audio 
frequency spectrum need be fully driven to rated per channel power 
under Sec. 432.2(a)(2) of the Rule? If not, how should the Commission 
amend the Rule to clarify testing procedures for such self-powered 
combination speaker systems?

C. The Rule's Preconditioning Requirement

    (5) Should the Commission amend Sec. 432.3(c) of the Rule to reduce 
the preconditioning power output requirement from one-third of rated 
power to one-eighth of rated power?
    (6) Should the Commission amend Sec. 432.3(c) of the Rule to 
explain that, for amplifiers utilized as a component in a self-powered 
subwoofer system, the sinusoidal wave used as a preconditioning signal 
may be any frequency within the amplifier's normal operating bandwidth 
that will allow the amplifier to be driven to one-eighth of rated power 
for one hour? If not, how should the Commission amend the Rule to 
clarify the preconditioning protocol for self-powered subwoofers?

    Authority: 15 U.S.C. 41-58.

List of Subjects in 16 CFR Part 432

    Amplifiers, Home entertainment products, Trade practices.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 99-18302 Filed 7-16-99; 8:45 am]
BILLING CODE 6750-01-M