For example: Original HDTV programming is made in the 16x9 (1.78) as aspect ratio, which fits the dimensions of HDTVs. However, many theatrically films are made in either the 1.85 or 2.35 aspect ratio, which is even wider than the 16x9 (1.78) aspect ratios of HDTVs. Thus, when viewing these films on an HDTV (if presented in their original theatrical aspect ratio) - you will see black bars on your 16x9 screen. However, the bars will be less pronounced than if the same movie was letterboxed on a standard 4x3 set.
Aspect Ratios can vary from movie to movie or program to program. If you are watching a DVD or Blu-ray Disc - the aspect ratio listed on the package labeling will determine how it looks on your TV.
For example if the film is listed as 1.78:1 - then it will fill the entire screen correctly.
If the aspect ratio is listed as 1.85:1, then you will notice small black bars on the top and bottom of the screen.
If the aspect ratio is listed as 2.35:1 or 2.40:1, which is common for big blockbuster and epic movies - you will see black bars on the top and bottom of the screen.
On other hand, if you have a Blu-ray Disc or DVD of an older classic movie and the aspect ratio is listed as 1.33:1 or "Academy Ratio" then you will see black bars on the left and right side of the image, instead of the top and bottom. This is because the movies were made before the common use of widescreen or was originally filmed for TV - before HDTV was in use.
The main thing to be concerned about is not whether image fills the screen, but that you are seeing everything in the image that was originally filmed. Being able to view the entire image as originally filmed is certainly the more important issue, rather than be concerned about how thick the black bars are, especially if you are viewing the image on projection screen, which is a large image to begin with.
On the other hand, when viewing a standard 4x3 image on a 16x9 set, you will see black or gray bars on the left and right side of the screen, since there is no information to fill the space. However, you can stretch the image to fill the space, but you will distort the proportions of the 4x3 image in doing so, resulting in objects appearing wider horizontally. Once again, the important issue is that you able to view entire image, not whether the image fills the entire screen.
The way to look at this issue is the TV screen is providing a surface upon which you are to view images. Depending how the images are formatted, the entire image may or may not fill the entire screen surface. However, the screen surface on a 16x9 Television is able to accommodate more variations in image aspect ratio realistically than the traditional 4x3 analog televisions.
For more specifics on the characteristics of 16x9 Widescreen Television, check out my reference article: Widescreen TV: The 16x9 Factor.
In addition, check out another detailed article, with illustrations, on this topic: Why Don't The Black Bars Go Away? from High Def Digest.
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