Date: May 27, 1999 Securities and Exchange Commission 450 Fifth Street, N. W. Washington D.C. 20549-0609 Attn: Jonathon G. Katz, Secretary (mailto:rule-comments@sec.gov) Subject: File No. S7-9-99 (EDGAR Modernization) SEC Release Nos. 33-7653; 34-41150; IC-23735 This letter is a comment in response to the SEC's RFC on the proposed rules for the modernized SEC EDGAR system. Since 1984, the EDGAR system has been based upon a lowest common denominator approach toward text browsing and dissemination. The goal of EDGAR was twofold, to allow any ASCII display terminal to be able to display the text in an identically readable fashion and to allow a limited document structure (tags) that facilitates document identification and importation of tables into spreadsheets. On April 9, 1999, the "EDGAR modernization" was announced. The purpose of the modernization is to make the system easier for filers to use and to make the documents more attractive and readable for the consumer. Does the SEC subset of HTML 3.2 answer these modernization issues? o Although HTML will offer some cosmetic qualities to the document such as varying fonts, type sizes, special characters and images, the overriding goal of the text being identical from one display to the next may be sacrificed. o Since there will now be the ability to place invisible characters into the document, there may be some legal ambiguity between the printed document that has been approved and the actual HTML source listing. o File sizes will balloon with uncompressed formats of text and new graphics. This will create longer upload and download times in addition to creating more demands for disk space from the corporation to the SEC to the disseminator and to the consumer. Disallowing graphics however would leave little compelling improvement over the present ASCII filing format. o Shrink-wrapped software web publishing and word processing tools will not create fileable documents. In the past, word processing documents could create a text document that could be manually tagged and "EDGARized" with modest effort, but to manually tag a document for the SEC subset of HTML 3.2 will take much greater expertise and far more time. o The proposed rules state that the SEC expects to require HTML "as soon as practicable". This loose schedule will probably not encourage people to experiment with HTML until it is too late to change anything. In 1984 the SEC launched a pilot project to examine the effects of EDGAR filing. Would it not be worthwhile to test HTML more thoroughly in the marketplace as we did in 84? So far, all we have seen is a list of HTML tags, to better determine feasability we will need to see examples of valid HTML documents. The forthcoming manual might also be helpful. o Legacy data already filed with the SEC should be allowed to remain in ASCII. To convert these documents to HTML would be too big a burden and even if they were converted, there would be old - previously un-filed items such as graphics that might be difficult or impossible to find and place correctly. Sometimes these documents are re-filed as part of new filings and if they were to be converted to another format, it would probably necessitate re-reading all the way down the distribution channel. o The proposed rules ban external URL links. This ban is needed to avoid the linking to material that may change, however, there may be reason to insert a link to a corporate website that is intended to be changing. Therefore, this ban should probably be qualified. Perhaps we should revisit PDF files as the filing standard? The U. S. Government has already standardized on PDF for tax forms and many other departmental forms as well. PDF is an openly published standard, owned by ADOBE. PDF files are designed to not only display identically across platforms and monitors, but also print across different printers. PDF files are searchable and taggable. There is no 'show source' command in the PDF reader, so access to invisible comments would not be an issue. File sizes could be minimized through compression and the corporations would have less work to create a PDF than there was to create an original EDGAR filing. For the disseminator, the corporation might provide a set of ASCII tab-delimited files containing each table linked from the PDF file thus allowing the easy importing of tables into a spreadsheet. We believe that this method would be a faster, cheaper, and more precise filing system that would withstand the test of time. Whatever we do with HTML will be slow, costly, inexact and awkward in the future when compared to ASCII, PDF or emerging standards. Absent the PDF alternative, and if we can tolerate the inherent problems of HTML, we would most vehemently request that the SEC allow cascading style sheets (CSS) so that we could better control the position of characters on a page. Otherwise, the transition and continued use of the EDGAR system will be unnecessarily costly for filers, disseminators and consumers alike. Sincerely, Don Winsby, Jr. President Typotronics Inc. and member of The EDGAR Group mailto:donw@edgargroup.com http://www.edgargroup.com/