FTC Issues Report on Marketing Violent Entertainment to Children

The Federal Trade Commission gave a mixed review of the movie, music, and video-game industries’ self-regulatory programs and their marketing of violent entertainment products to children in its latest report to Congress. This fifth follow-up report, the most comprehensive study since 2000, found that all three industries generally comply with their own voluntary standards regarding the display of ratings and labels. However, entertainment industries continue to market some R-rated movies, M-rated video games, and explicit-content recordings on television shows and Web sites with substantial teen audiences. In addition, the FTC found that while video game retailers have made significant progress in limiting sales of M-rated games to children, movie and music retailers have made only modest progress limiting sales.

“Self-regulation, long a critical underpinning of U.S. advertising, is weakened if industry markets products in ways inconsistent with their ratings and parental advisories,” said FTC Chairman Deborah Platt Majoras. “This latest FTC report shows improvement, but also indicates that the entertainment industry has more work to do.”

The report includes results from the FTC’s latest mystery shop where unaccompanied children, ages 13-16, were sent into retailers to make a purchase. The undercover shop found significant improvement by video-game retailers, particularly in national retail chains, but little or no improvement by movie theaters, or DVD and music retailers.

Percent of Children ABLE to Make the Purchase Unaccompanied
*Denotes a statistically significant change.

	2000	2001	2003	2006
R-Rated Movie Theater Ticket	46%	48%	36%*	39%
R-Rated Movie on DVD	N/A	N/A	81%	71%*
Unrated Movie on DVD	N/A	N/A	N/A	71%
Explicit-Content Labeled Music Recording	85%	90%	83%	76%*
M-Rated Electronic Game	85%	78%*	69%*	42%*

Other findings in the report include:

• Movies: Although there is no industry-wide standard, several individual movie studios have adopted guidelines restricting advertising on television shows where the under-17 audience is more than 35%. The study found a few examples of R-rated movies and unrated DVD advertisements on television shows where the under-17 audience exceeded 35%, but most television ads were placed on shows that fell under this threshold. Nevertheless, the report notes that a 35% standard still permits advertising on the vast majority of shows most popular with teens. Currently, there are no movie industry standards for Internet advertising, and the report notes violent R-rated movies were routinely advertised on Web sites popular with kids: 18 of the 20 movies studied by the Commission were advertised on Web sites where more than a third of the audience was under 17. The increasing prevalence of marketing unrated DVDs containing content that might warrant an NC-17 rating, coupled with the poor performance of retailers in restricting the sales of such DVDs to unaccompanied children, is a particular cause for concern.
• Music: Because the music labeling system is not age-based, the industry has no specific restrictions on advertising explicit-content labeled music in media popular with children. The report notes that ads for explicit-content music routinely aired on cable television shows and Web sites with a teen audience of 40% or more. The industry also needs to do a better job of displaying the explicit-content logo in television advertising. On the plus side, the industry continues to refrain from significant advertising in magazines popular with teens, a practice that was prevalent when the Commission published its initial report in September 2000.
• Video Games: Although ads for M-rated video games on television shows that are popular with teens appear to be diminishing, the same is not true for Internet advertising. Currently, the ESRB prohibits ads for M-rated games on Web sites where the under-17 audience is 45% or more. The report suggests that the ESRB is not adequately enforcing even this limited standard. The video game industry generally provides clear and prominent disclosure of rating information in advertising; however, the ESRB has not adopted the Commission’s previous recommendation that content descriptors for games be placed on the front of game packaging. The Commission’s survey of parents and children on their awareness and use of the video game ratings system showed an overall positive picture of the game rating system: 87% of parents surveyed said they are aware of the ESRB system, more than seven in ten use it when their child wants to play a game for the first time, and three quarters of the parents who are familiar with the content descriptors use them. However, many parents still believe the system can do more to inform them about the level of violence in some games.

For the first time, the Commission tracked trends in viral marketing, including social networking sites such as MySpace, and viral video sites like YouTube. Advertisers often set up profile pages with industry-generated content or uploaded videos for users to then share on their own, such as posting music to their own profile page or emailing videos to friends. The report noted that few profile pages contain prominent rating information. Although they are general audience sites, they reach a large number of children under 17. The report also flags a new trend in gaming, mobile phone games, and noted several challenges they pose. For example, mobile phone game developers often do not seek ESRB ratings and they do not sell their products through traditional retail channels, instead licensing their products directly to wireless carriers. The report discusses industry efforts to provide some form of parental oversight in this fledgling area.

The FTC recommends that all three industries consider adopting new, or tightening existing, target marketing standards. The FTC also suggests retailers further implement and enforce point-of-sale policies restricting sales of rated or labeled material to children under 17. In particular, the report suggests the movie industry examine whether marketing and selling of unrated or “Director’s Cut” DVD versions of R-rated movies, which may contain content that could warrant an even more restrictive rating, undermines the current self-regulatory system. The report also suggests that the music industry provide more information on packaging and in advertising about why certain recordings receive a Parental Advisory. Finally, the report recommends that the video game industry place content descriptors on the front of product packaging and research why many parents believe that the system could do a better job of informing them about the level of violence in some games.

The Commission continues to support industry self-regulation in this area given important First Amendment considerations. The Commission will continue to monitor this area, particularly as emerging technologies change the way entertainment products are marketed and sold. The Commission also will continue to work with industry and others to encourage efforts to provide parents with the information they need to decide which products are appropriate for their children.

Further details are included in the report itself, including the specific movies, recordings, and games that were studied by the Commission, and the television shows, Web sites, and other places where ads were placed. The report also includes the methodologies and detailed results from the Commission’s mystery shop and survey on awareness and use of the ESRB rating system.

Consumers can obtain a copy of this report, access information about entertainment ratings, or file a complaint related to media violence by visiting our website at http://www.ftc.gov/ratings.

Copies of the report are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov/ftc/complaint.htm. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to more than 1,600 civil and criminal law enforcement agencies in the U.S. and abroad.