[Federal Register Volume 71, Number 114 (Wednesday, June 14, 2006)]
[Rules and Regulations]
[Pages 34247-34249]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-9233]


=======================================================================
-----------------------------------------------------------------------

FEDERAL TRADE COMMISSION

16 CFR Part 410


Deceptive Advertising as to Sizes of Viewable Pictures Shown by 
Television Receiving Sets

AGENCY: Federal Trade Commission.

ACTION: Confirmation of rule.

-----------------------------------------------------------------------

SUMMARY: The Federal Trade Commission (``FTC'' or ``Commission'') has 
completed its regulatory review of the Rule concerning Deceptive 
Advertising as to Sizes of Viewable Pictures Shown by Television 
Receiving Sets (``Rule'' or ``Picture Tube Rule''), as part of the 
Commission's systematic review of all current Commission regulations 
and guides, and has determined to retain the Rule in its current form.

DATES: This action is effective as of June 14, 2006.

ADDRESSES: Requests for copies of this rule should be sent to the 
Consumer Response Center, Room 130, Federal Trade Commission, 600 
Pennsylvania Ave., NW., Washington, DC 20580. The rule also is 
available on the Internet at the Commission's Web site, http://www.ftc.gov.

FOR FURTHER INFORMATION CONTACT: Carol Jennings, (202) 326-3010, 
Attorney, Division of Enforcement, Bureau of Consumer Protection, 
Federal Trade Commission, Washington, DC 20580. E-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Introduction

    The Commission has determined, as part of its oversight 
responsibilities, to review its rules and guides periodically to seek 
information about their costs and benefits as well as their regulatory 
and economic impact. The information obtained assists the Commission in 
identifying rules and guides that warrant modification or rescission.

II. Background

    The Commission's Picture Tube Rule, like the other trade regulation 
rules issued by the Commission, ``define[s] with specificity acts or 
practices which are unfair or deceptive acts or practices in or 
affecting commerce. Such rules may include requirements prescribed for 
the purpose of preventing such acts or practices. A violation of a rule 
shall constitute an unfair or deceptive act or practice in violation of 
section 5(a)(1) of the [Federal Trade Commission] Act, unless the 
Commission otherwise expressly provides in its rule.'' 16 CFR 1.8.
    The Picture Tube Rule, promulgated in 1966, sets forth the 
appropriate means for disclosing the method by which the dimensions of 
television screens are measured, when this measurement is included in 
any advertisement or promotional material for the television set. The 
purpose of the Rule is to prevent deceptive claims regarding the size 
of television screens and to encourage uniformity in measuring 
television screens, thereby aiding comparison shopping. Under the Rule, 
any representation of the screen size must be based on the horizontal 
dimension of the actual, viewable picture area, unless the alternative 
method of measurement is clearly and conspicuously disclosed in close 
proximity to the size designation. The Rule notes that the horizontal 
measurement must not take into account any curvature of the tube. 
Further, disclosing the method of measurement in a footnote rather than 
in the body of the advertisement does not constitute a disclosure in 
close proximity to the measurement. The Rule includes examples of both 
proper and improper representations of size descriptions.
    The Rule was last subject to regulatory review in 1994. At that 
time, the Commission decided to retain the Rule, concluding that it 
continues to be valuable both to consumers and businesses. The 
Commission, however, amended the Rule to clarify some of its compliance 
illustrations, provide metric equivalents for the measurements stated 
in inches, and add a new Note 3 to explain that the inclusion of metric

[[Page 34248]]

figures is for information purposes only and does not impose a 
requirement on the industry to use metric measurements. 59 FR 54809 
(November 2, 1994).
    Since the Rule was last subject to regulatory review and amended in 
1994, broadcasting and television technology have advanced 
significantly, and an array of new types of televisions are available 
in the marketplace. The technological change with the closest nexus to 
the Rule is the introduction of digital television, including high 
definition television, and the advent of new wider screen televisions 
to display these enhanced digital pictures.\1\ New television display 
technologies available today include thin, flat panel televisions with 
either liquid crystal or plasma display panels. In addition, there have 
been advances in the quality and popularity of front and rear, big 
screen, projection televisions.
---------------------------------------------------------------------------

    \1\ Wider screen televisions have a higher aspect ratio than 
traditional televisions (the aspect ratio is the ratio between the 
width of the picture and the height of the picture). Traditional 
televisions have an aspect ratio of 4 by 3 (1.33 to 1) while wider 
screen high definition televisions have an aspect ratio of 16 by 9 
(1.85 to 1).
---------------------------------------------------------------------------

    On April 7, 2005, the Commission published a Federal Register 
notice (``FRN'') seeking comment on the Rule as part of the 
Commission's ongoing project to review periodically its rules and 
guides to determine their current effectiveness and impact (70 FR 
17623). This FRN sought comment on the continuing need for the Rule, 
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.

III. Regulatory Review Comments

    The Commission received six comments in response to the FRN.\2\ 
Comments were received from five individuals \3\ and from the Consumer 
Electronics Association (``CEA''). CEA states that it is the principal 
U.S. trade association of the consumer electronics and information 
technologies industries. According to CEA, its more than 2,000 member 
companies include the world's leading consumer electronics 
manufacturers.
---------------------------------------------------------------------------

    \2\ The comments are cited in this notice by the name of the 
commenter. All Rule review comments are on the public record and are 
available for public inspection in the Consumer Response Center, 
Room 130, Federal Trade Commission, 600 Pennsylvania Avenue, NW., 
Washington, DC, from 9 a.m. to 5 p.m., Monday through Friday, except 
Federal holidays. The comments also are available on the Internet at 
the Commission's Web site, http://www.ftc.gov.
    \3\ The Commission's request for public comment elicited 
comments from the following five individuals: (1) John Woelflein 
(``Woelflein''), (2) Gavin Young (``Young''), (3) Michael Payne 
(``Payne''), (4) James Scott Hudnall (``Hudnall''), and (5) William 
Hooper (``Hooper'').
---------------------------------------------------------------------------

A. Support for Retaining the Rule

    The comments indicated generally that the Picture Tube Rule should 
remain in effect, although, as explained below, each comment 
recommended revising the Rule in one or more ways. One commenter, CEA, 
indicated that the Rule has provided benefits to consumers and imposed 
small costs on entities subject to the Rule's requirements. In 
particular, CEA indicated that the Rule requires manufacturers to 
provide useful information to consumers by allowing a fair comparison 
of televisions and usefully defines size as the television's viewable 
area. Although CEA argued that the Rule is unnecessarily burdensome 
because marketers commonly advertise diagonal measurements rather than 
horizontal measurements and therefore must add the word ``diagonally'' 
or a comparable disclosure to product literature and advertising, CEA 
also stated that the additional printing cost of adding such 
disclosures is small.\4\ None of the commenters advocated repeal of the 
Rule.
---------------------------------------------------------------------------

    \4\ CEA at 3.
---------------------------------------------------------------------------

    In light of the comments received, and in the absence of any 
opposition, the Commission concludes that there is a continuing need 
for the Rule. The comments provide evidence that the Rule serves a 
useful purpose, while imposing minimal costs on the industry, and the 
Commission has no evidence to the contrary. In the Commission's view, 
the Rule ensures the flexibility needed by the industry to use the 
method of measuring television screens it prefers, while making certain 
that consumers have enough information regarding screen size to make 
informed purchasing decisions. While changing the ``default'' 
measurement from ``horizontal'' to the more commonly used ``diagonal'' 
as CEA proposed, or requiring marketers to disclose screen size in 
square inches or metric units as some other commenters proposed, might 
improve the Rule, the cost of doing so would likely exceed the benefit. 
Accordingly, the Commission has determined to retain the Picture Tube 
Rule in its current form.

B. Suggested Changes to the Rule Regarding the Manner of Measurement

    Although the comments supported preserving the Picture Tube Rule, 
all of them proposed changes. CEA urged the Commission to eliminate the 
horizontal dimension as the Rule's default measurement, which, when 
used, does not require a disclosure of the method of measurement in 
close proximity to the size designation.\5\ Currently, the advertised 
dimensions of the television screen's viewable picture area must 
reflect the horizontal measurement unless the alternative method of 
measurement is clearly and conspicuously disclosed in close proximity 
to the size designation. According to CEA, however, the prevailing 
practice within the industry is to use the diagonal plane to measure 
the screen. Thus, CEA urged the Commission to amend the Rule to reflect 
current industry practice. Specifically, CEA proposed requiring 
marketers to make any claim regarding the size of the television screen 
using a diagonal measurement, unless they disclose clearly and 
conspicuously the alternative method of measurement.\6\ In support of 
its recommendation, CEA identified references to television screen 
sizes, as measured diagonally across the picture viewing area, in 
Federal Communications Commission regulations announcing the digital 
television reception capability implementation schedule (47 CFR 
15.117), and in flat-panel-screen color television listings in Chapter 
85 of the Harmonized Tariff Schedule of the United States.\7\
---------------------------------------------------------------------------

    \5\ CEA at 1.
    \6\ CEA also proposed a few minor wording changes to the Rule 
and the elimination of several examples (e.g., substituting the word 
``display'' for the word ``picture'' and dropping examples of 
improper size descriptions). In addition, it proposed adding a 
statement that ``This Rule assumes a display with a 4 by 3 aspect 
ratio. For displays with a 16 by 9 aspect ratio, the diagonal 
measurement may be followed with a suffix `W.' '' CEA at Appendix B. 
CEA did not explain the rationale for these proposed changes. Given 
that CEA proposed these changes without providing any explanation or 
supporting evidence, the Commission has determined not to make any 
of these proposed changes to the Rule.
    \7\ CEA at 5.
---------------------------------------------------------------------------

    Three other commenters, however, urged the Commission to amend the 
Rule to require marketers to describe the size of the television 
screen's viewable picture area in terms of square inches or square 
metric units.\8\ The commenters stated that such a disclosure would 
make it easier for consumers to compare the picture areas of 
conventional television screens with the picture areas of the new wide 
screen televisions that are available in the marketplace.\9\ None of 
the commenters argued that this change is necessary to prevent

[[Page 34249]]

deception or provided the Commission with any market research or other 
data bearing on how consumers view the various methods of measuring 
television screens.
---------------------------------------------------------------------------

    \8\ One of them also proposed that the Rule require disclosure 
of the television's aspect ratio. Hudnall at 1.
    \9\ Young at 1; Hudnall at 1; and Hooper at 1.
---------------------------------------------------------------------------

    When the Commission initially promulgated the Rule in 1966, most 
television manufacturers measured the dimensions of their television 
sets diagonally, just as they do today. Thus, the horizontal dimension 
was not chosen based on a belief that it was the industry norm. Rather, 
the Commission found that almost all rectangular objects were measured 
horizontally and vertically. Television screens were the only 
rectangular-shaped commodities that were measured diagonally. Thus, the 
Commission reasoned, if a rectangular screen was measured in the usual 
manner for similarly-shaped objects, then no disclosure was 
necessary.\10\ Moreover, the television industry has adopted the Rule's 
disclosure requirements as part of its routine business practice, 
although the industry generally does not use the Rule's default 
horizontal measurement method. In 1994, the Commission rejected a 
similar proposal to amend the Rule to adopt the diagonal measurement 
method as the standard in the Rule (59 FR 54809, 54811 (November 2, 
1994)).
---------------------------------------------------------------------------

    \10\ 31 FR 3342 (March 3, 1966).
---------------------------------------------------------------------------

    The Commission is not aware of any evidence that revising the Rule 
to require a disclosure when a measurement other than the diagonal 
dimension is used, or to require marketers to describe screen size in 
square inches or metric units, would provide a tangible benefit to 
consumers. Moreover, revising the Rule to make the diagonal measurement 
the default measurement as CEA proposed could potentially cause 
confusion to the extent consumers accustomed to seeing screen 
measurements described as diagonal might mistakenly believe the 
measurements not described as diagonal are in fact based on horizontal 
or area measurements. The commenters failed to submit convincing 
evidence that their proposed changes would confer net benefits on 
consumers or the industry, or that the Rule as amended would better 
protect consumers from deception.
    The Commission believes that the Rule is sufficiently flexible to 
allow industry to use the method it prefers for measuring television 
screen sizes to meet consumer expectations and compete effectively, is 
easy to comply with at minimal cost, and ensures that advertising 
contains sufficient information on screen size to allow consumers to 
make informed purchasing decisions. If marketers determine they can 
compete more effectively by disclosing screen size measured in square 
inches or metric units, the Rule allows them to do so. Thus, expending 
additional resources at this time to seek further comment and testimony 
at hearings on the methods of measuring television screens is not 
justified. The absence of evidence indicating a need to amend the Rule 
and the risk, however small, that amending the Rule as CEA proposed 
would cause confusion argues against conducting a rulemaking proceeding 
to re-write the Rule. The Commission has therefore determined not to 
amend the Rule's disclosure requirements at this time.

C. Suggested Changes to the Rule Regarding Metric Disclosures

    Five individual commenters urged the Commission to amend the Rule 
to require the industry to use metric measurements, in conformance with 
the Metric Conversion Act.\11\ As discussed above, in 1994, the 
Commission amended the Rule to provide metric equivalents for the 
measurements stated in inches in the Rule's examples. The Commission 
noted further that inclusion of metric figures in the Rule was for 
information purposes only and did not impose a requirement on the 
industry. In the Commission's view, the Rule is sufficiently flexible 
to permit industry members to use metric measurements, if they choose 
to do so to compete effectively in the global marketplace. Accordingly, 
the Commission has determined not to amend the Rule in this manner.
---------------------------------------------------------------------------

    \11\ Woelflein at 1; Young at 1; Payne at 1; Hudnall at 1; and 
Hooper at 1. Under Executive Order 12770 of July 25, 1991 (56 FR 
35801), and the Metric Conversion Act, as amended by the Omnibus 
Trade and Competitiveness Act (15 U.S.C. 205), all Federal agencies 
are required to use the SI metric system of measurement in all 
procurements, grants and other business-related activities (which 
include rulemakings), except to the extent that such use is 
impractical or is likely to cause significant inefficiencies or loss 
of markets to United States firms.
---------------------------------------------------------------------------

D. Suggested Changes to the Rule Regarding Rounding

    CEA requested that the Commission amend the Rule to address the 
issue of rounding fractional television screen size dimensions to whole 
numbers to provide consistency within the industry.\12\ In support of 
its request, CEA referenced an Electronics Industries Alliance 
(``EIA'') statement that specifies a system for rounding television 
screen sizes to whole numbers. According to CEA, the statement 
provides, in part, that, ``A tube having its screen size within plus or 
minus one-half centimeter shall be assigned that integer. A tube 
falling exactly on a one-half centimeter shall be assigned the next 
larger integer.'' \13\ CEA recommended that the Commission amend the 
Rule to adopt an approach to rounding consistent with this statement.
---------------------------------------------------------------------------

    \12\ CEA at 4.
    \13\ See Worldwide Type Designation System for TV Picture Tubes 
and Monitor Tubes, ECA-TEP-106B. EIA is a partnership of electronic 
and high-tech associations and companies whose mission is promoting 
the market development and competitiveness of the U.S. high-tech 
industry. EIA's nearly 1,300 member companies represent the full 
range of consumer electronic products.
---------------------------------------------------------------------------

    In the absence of consumer research or other evidence on the record 
in this proceeding that revising the Rule as proposed by CEA would not 
result in deception in connection with disclosing the viewable picture 
area of a television screen, the Commission has determined not to amend 
the Rule at this time to address the issue of rounding.

IV. Conclusion

    For the reasons described above, the Commission has determined to 
retain the current Rule and is terminating this review.

List of Subjects in 16 CFR Part 410

    Advertising, Picture tubes, Television sets, Trade practices.

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

    By direction of the Commission.
Donald S. Clark,
Secretary.
 [FR Doc. E6-9233 Filed 6-13-06; 8:45 am]
BILLING CODE 6750-01-P