The fog of telecom

Submitted by acohill on Mon, 11/15/2004 - 18:36

There is a fair amount of disinformation being bandied about on the issue of community-managed telecom infrastructure. Read this article [link no longer available] by the deceptively name "Heartland Institute" for an example of a very one-sided view of community investments in telecom.

Here's another view. The context here is a proposed community telecom project in Illinois, where the incumbent telecom providers have spent millions to try to convince citizens and community leaders that the sky will fall if communities make investments.

Part of the disinformation campaign involves selective reporting. Bristol, Virginia's widely cited fiber to the home project has been misleadingly reported as bleeding red ink, but the way this is done is by looking at only the first two years of the project, where capital costs were correctly projected to be high. By looking at just the first two years, it's easy to show the project is "losing money" and cheating taxpayers. But the real facts are a bit more difficult--as the project moves into year three, Bristol has a big backlog of consumers and businesses clamoring for service, and the project expects to move into the black ahead of schedule.

Another problem with community infrastructure projects is that they fall into several different categories in terms of business models and levels of investment. Some articles that purport to "prove" that community projects are moneylosers by comparing two entirely different business models--one theoretical and one actual. It's very confusing unless you know what is going on.

We just are not far enough along in most real projects to have reliable data, and that's one of the tricks being played--it's entirely too early to tell if most of these community efforts are going to work over the long run or not. But if anecdotal reports from happy customers are any gauge at all, I'm not greatly worried.

And you always have to compare these theoretical doom and gloom stories with the actuality of most rural communities--little or limited DSL service, lack of choice, high prices, poor service, or some mix of all four.

Finally, the biggest trick of all is to take private sector ROI measures and use them as a yardstick for community projects, claiming that if these projects "don't make money," they aren't worth doing. When was the last time any community used ROI to develop support for a community project? The answer is, "Never." Because it just doesn't make sense in the context of "community good," which is why these things get started in the first place.

What's the ROI on a town park? What's the ROI on the community library? What's the ROI on garbage collection? We don't try to measure community services based on return on investment because that's not why we do them in the first place.

Should community telecom infrastructure projects be based on sound business models? Absolutely, and they should not require long term injections of funding from general tax funds. But that's not the same as trying to treat them as a private sector business.

Don't fall for the tricks.

Ukraine has a vision for the future

Submitted by acohill on Mon, 11/15/2004 - 09:56

Ukraine, a country still struggling with the legacy of the Soviet past, has what many other states in the U.S. still lack--a coherent and easy to explain vision for the future. BusinessWeek has a short article on the country's drive to be one of the top software and IT countries in the world.

That may sound brash, but they are not wringing their hands over the "old days" or talking about "we've never done that before." They are putting a heavy emphasis on education, and cranking out more programmers and IT specialists than many larger countries with a bigger population and more structural advantages.

I've never seen a community fail that has the will to succeed--regardless of how much or how little money they have. I have seen some very well off communities accomplish virtually nothing because they could not articulate where they wanted to go and how they wanted to get there. In the case of Ukraine, they are betting on education and training. I think it's a safe bet that the country will prosper.

Big Brother will be watching while you drive

Submitted by acohill on Fri, 11/12/2004 - 12:12

In a deeply disturbing ruling, the National Transportation Safety Board has ruled that car manufacturers must put black box data recorders in new cars and trucks. The boxes will record speed, acceleration, braking, direction, and other data that could be used to reconstruct accidents, among other things.

The problem with this is that the data does not belong to the vehicle owner--it can be accessed by third parties without your consent. Traffic safety experts like to talk at length about how the data is valuable in analyzing accidents and improving vehicle safety. Fair enough, but forcing private property owners to both buy the system and to give law enforcement officials, officers of the court, and other third parties access to the data without the permission of the property owner is not acceptable.

Expect a big fight over this one, and there should be a big fight. This is abusive technology--the fact that we now have the technology to monitor and collect this kind of data does not mean we should automatically force everyone to use, at great loss to our privacy.

Movies on your cellphone

Submitted by acohill on Fri, 11/12/2004 - 12:06

If you've ever wondered, as I have, what on earth you would do with the new "movie" feature being advertised on cellphones, wonder no longer! You can watch advertisements!

Yes! In your spare time, if you have had nothing to do, you've been wishing for access to some good ads. "Gosh, I'm bored. I wish there was a good ad I could watch."

Rest easy. Now you can watch movie trailers on your cellphone.

This in the category of "Things I never knew I wanted." The "mobisodes" (mobile episodes) are coming from Twentieth Century Fox, and will advertise upcoming movies and televisions shows. Lasting just one minute, they will be rolled out in the U.K. first.

This particular, um, "feature" is not likely to last, but it is another indicator that entertainment generally is going to drive broadband use.

AOL dumps broadband services

Submitted by acohill on Fri, 11/12/2004 - 11:56

AOL has announced that it is dumping its broadband customers in nine states. AOL has been in decline for years, and this is one more indication that the company is completely adrift. AOL's foray into broadband service was a mystery to me in the first place, since they had to resell access purchased wholesale from other providers.

I don't think AOL has ever really understood what it is about. For too long, it thought it was an access company because people bought AOL accounts to get Internet access. But I could told them that was doomed in 1997, if they had wanted to listen. Dial-up is over--growth in dialup peaked at least two years ago, and the DSL, cable, and other broadband providers have been taking AOL's customers since then.

AOL, in my mind, has always been a content company, but I don't think AOL has ever really embraced that as a strategy. They had it too easy for too long, with the Internet build-up dumping buckets of cash into their coffers while the Internet was hot. The problem for AOL has always been that it never was and still is not an Internet access provider. They've always maintained their own personal coccoon for users that was designed and developed long before the Internet took off, and they've never figured out an exit strategy. AOL's Web browser used to drive Web designers nuts because it was so bad--bad because AOL squeezed Internet data through an AOL sieve and still does. No one else does that anymore.

For certain kinds of users, AOL provides a good environment. They've done a nice job of providing a family-friendly interface, as one example. But unless they can finally let go of their legacy systems and reinvent themselves, the company will slowly go out of business.

More VoIP good news

Submitted by acohill on Fri, 11/12/2004 - 11:50

The FCC released another ruling on VoIP. The Federal Communications Commission has barred states from imposing telecom regulations on Voice over IP telephony providers.

This is additional good news for businesses and consumers who are saving money by using VoIP services (estimated to be well over 4 million customers). State and local taxes on telephone services with no local infrastructure or presence is simply taxation without representation in another form, and revenue-hungry governments ought to keep their hands off VoIP. Taxing things like that just makes the state or locality less competitive globally and retards economic development.

Unfortunately, the FCC has still not ruled on whether VoIP is an information service or a telephone service. If it is considered a telephone service, VoIP would be subject to the no longer relevant telephone regulation of the last century. But so far, the FCC rulings on VoIP have all been in the right direction.

Rollin', rollin', rollin', keep those new phones rollin'

Submitted by acohill on Thu, 11/11/2004 - 10:54

The FCC has ruled that VoIP is an interstate service, in response to a petition from Vonage, one of the best known national VoIP providers.

This is very significant, because it snatches VoIP out of the clutches of state by state regulation (we've got 50) that could have easily sunk the service before it got started. State regulation would have been a nightmare, and at the least, would have increased the cost of service. At the worst, some VoIP companies would have just quit the business and potentially sunk the industry. There is no way VoIP could be competitive if each VoIP provider had to deal with 50 different sets of taxes and regulation.

Historic meeting in Vancouver, British Columbia

Submitted by acohill on Thu, 11/11/2004 - 10:13

I had the privilege of attending what I think was a historic and potentially revolutionary meeting in Vancouver, British Columbia, on Tuesday. The provincial government had convened an all day conversation about the broadband needs of rural communities, and how to best get affordable broadband connections to those communities.

It was Garth Graham, one of the real pioneers of the community technology movement, who grabbed me after lunch and pointed out that as far as he knew, it was the first time ever that four different groups of people met in the same room to talk about rural broadband problems. Represented at the meeting were:

It was a remarkable meeting, with open, frank, and stimulating dialogue from all four groups. The fact that it happened, that so many people attended (over 50 people), and that there was such honest speaking, listening, and understanding, suggests that we have truly turned a corner in beginning to identify and actually implement community telecom solutions that have a chance of meeting both public needs (the common good) and private needs (increasing shareholder value).

The group agreed that more meetings were needed to hash out details, but there was remarkable consensus that the problem is largely one of policy, administration, and management, and that this is not a technology problem, in the sense that it is NOT a matter of just picking wireless, or fiber, or Gigabit Ethernet, or so on. All parties agreed that communities and regions need some new and yet to be determined entity to help with telecommunications issues (infrastructure, access, services, policy, regulation).

MPAA to sue movie downloaders

Submitted by acohill on Fri, 11/05/2004 - 08:46

The MPAA (Motion Picture Association of America) has decided to sue grandmothers and fourteen year old kids who are allegedly downloading bootleg copies of movies.

Like the music industry attempts at litigation, it accomplished little except prove the stupidity of these movie execs. When "millions" of people are trying to watch your movies, that's called a market opportunity, not a field day for lawyers.

If you haven't heard much about the evils of music sharing lately, it's because Apple (not a music company) is making the music industry millions of dollars through Apple's online music store. Competitors with similar legal music download services are also stuffing millions into the pockets of music company execs.

On the artist side, some bands and musicians now don't bother to even sign a recording contract. Instead, they market their music online, burn their own CDs and sell them online and at concerts, and are free of the tyranny of the music industry.

The movie industry is going through the same convolutions. The Blair Witch Project, an enormously profitable movie, was shot with cheap cameras and edited and produced on some Macintosh computers--no expensive movie industry post-production needed. Apple's Final Cut Pro is now being used to edit and produce big screen movies--changing the entire post production process that used to be dominated by high-priced Hollywood firms. The new technologies are putting much more control in the hands of musicians, directors, and writers--a good thing, unless you are an exec at one of the old Manufacturing Economy businesses that thinking sueing customers is great public relations.

eBay and business

Submitted by acohill on Thu, 11/04/2004 - 10:18

There is the old joke that goes like this:

"There are two kinds of people in the world--those that divide people into two groups, and those that don't."

At the risk of self parody, there are two kinds of people in the world (and I'm broadly overgeneralizing, of course)--those that use eBay and those that don't.

For those that don't, the eBay phenomenon is a bit of mystery. From a certain distance, EBay is cluttered with junk, trivia, excess, and silliness. But it also is a terrific business transaction mechanism, for both formal and informal business.

I just bought a part for my breadmaker. The manufacturer has been out of business for four years, and parts are no longer available through "normal" channels--that is to say, the Manufacturing Economy manufacturer--distributor--dealer supply chain.

But I found the part I needed for $9 (new cost was $15 when it was available) from a guy in Nebraska whose machine had burned up. Instead of throwing it in the landfill, he's selling usable parts from it and making a few extra bucks. It's not only reducing the amount of waste going into landfills (parts of his machine and all of mine), he's profiting from it, and I'm able to keep a perfectly good machine working.

It's amazing when you think about it. A scant ten years ago, the notion of linking a buyer for a very obscure machine part in Virginia with a seller in Nebraska was inconceivable. Today, we take it for granted.

Many small businesses are now using eBay as a strategic part of their business, putting both normal stock and overstocks there for sale. It's a cheap and easy mail order strategy that has virtually no downside.

Does your region's economic development strategy include workshops to help businesspeople learn how to use eBay? I bet not, and business growth opportunities are being missed.

Mac OS X the "safest" computing environment

Submitted by acohill on Tue, 11/02/2004 - 10:53

A London computer security firm has just completed an extensive, year-long study of hundreds of thousands of security breaches against computers running a variety of operating systems, and OS X was found to be the most secure. OS X is a Unix computing environment running the BSD variant.

Surprisingly, Linux was found to be the target of many security attacks, although the Windows platform also recorded very high numbers of breaches.

More on videoconferncing

Submitted by acohill on Tue, 11/02/2004 - 10:28

I wrote yesterday about Apple's excellent and free videoconferencing software. Last night, I saw a Microsoft ad touting the advantages of their LiveMeeting product. It's interesting to look at the two very different approaches to the same market space.

Apple has chosen to build value into the basic operating system by providing the software for free. It's functionality is basic, but it works very well, and the next upgrade will suppposedly support videoconferencing with multiple site (the equivalent of a conference call). However, there is no support for document sharing, which would really enhance the value of the service. There are several third party products for the Macintosh would do provide some document sharing and whiteboard functions.

Microsoft's LiveMeeting is a fee-based service that provides some meeting management tools, document sharing, and the ability to include several sites, but there is no videoconferencing. You apparently have to use traditional telephone conference calls to provide the audio portion of the meeting. I say "apparently" because I could not find that information on the site without watching a thirty minute presentation online.

LiveMeeting is a slick product that offers a lot of useful services, but it's really a broadcast medium--which would be quite useful in many situations. The document sharing and whiteboarding won't scale up (on any platform) beyond a few people. Microsoft seems to be aiming for the corporate market, where you might want to make a company presentation to hundreds of people at once in several locations.

Apple is more focused on relationships. In the Knowledge Economy, who you know is more important than what you know, and the ability to maintain and support face to face meetings is going to be increasingly important. From our current book of the month on social networks:

"This is not so much about pushing more information through a group but about developing relationships that can be rapidly sought out when needed."

The other difference between the two models is that Apple, by making their software part of the operating system (and free) is trying to empower their customers to use it freely for whatever purpose they choose, whenever they choose. Microsoft wants to charge you every time you have a meeting. Admittedly, the products are somewhat different, so you can't make too much of my comparison, but I do think the two companies have a very different philosophy toward their customers.

Google's Gmail already needed a security fix

Submitted by acohill on Tue, 11/02/2004 - 10:24

Google's popular Gmail has already required a security patch that allowed a third party to easily log in and gain full access to one's mail.

I'm amazed at people's willingness to hand over all their private and/or business correspondance to a third party that can do anything it likes with it. Yes, they have a privacy policy, but they also reserve the right to change the privacy policy without your permission.

Gmail, by all accounts, has done a great job with the interface for the software, and in general, email clients desperately need better design in this area. But the risk is just too high. I'm keeping my email on my own machine, under my own control.

ADSL2+ increases the digital divide

Submitted by acohill on Mon, 11/01/2004 - 09:09

A flurry of articles like this are talking about ADSL2+, a new standard for DSL service over old copper phone lines. ADSL2+ is not only too long as an acronym, it offers too little, and ironically increases the digital divide, in my opinion.

In short, the new service will provide increased bandwidth over copper phone lines, but only if you are about one and a half miles from the telephone switch, as opposed to the three miles of the current DSL offering. ADSL2+ also will go further than the old three mile limitation, but only at low data rates--about four times dial up speeds.

So a few subscribers may get DSL service where they could not before, but only at much slower than "normal" DSL. And a few subscribers may get much faster service, but only if they are very close to the telephone central office. And it's important to remember that the distance rule of thumb is not line of sight, but cable feet; not only that, the ability to deliver DSL is highly dependent on the quality of the copper cable. In many rural areas, DSL just does not work on older cable plant, even inside the distance limits.

It's hard to see how this benefits anyone, even the phone company. It further segments their own customer base and prevents them from offering the same set of services to all customers. For example, some ADSL2+ customers might be able to get a single channel of high quality high defintion TV (HDTV), but others will not. How you market that is a mystery to me--"HDTV--it might work in your area, but maybe not!"

The phone companies are still very fixated on market share, rather than on offering good services in a competitive marketplace. So in their minds, anything that continues to allow them to lock customers up over copper is good, even if it's bad. Does that make sense to you? It doesn't to me either, but that's their strategy until they can figure out a way to justify running fiber to neighborhood.

Videophones are ready for business

Submitted by acohill on Mon, 11/01/2004 - 08:58

CNet has an article on the "plunging" prices of videophone systems, heralding a drop to under $500.

These are hybrid phone systems that wed old phone system technology with video, in an attempt to create a bridge between conventional phone systems and Internet-based protocols.

I would not spend any time or money on these systems. There are already much less expensive all-IP based systems. I routinely use an inexpensive but high quality iSight camera with the very good videophone software that Apple provides free on every Macintosh.

For the cost of one station using these hybrid systems, you could buy four iSight cameras and give them to three friends, family, or business colleagues--if you and your associates use Macs.

Right about now, some of you are about to click to some other site, having little patience with Mac users. The larger point is this: what's available now on the Mac will be available on the Wintel platform in a year or so. I'm not trying to argue Macs are better, I'm trying to illustrate that these relatively expensive hybrid videophone systems won't last long in the face of less expensive and easier to use alternatives.

County Administrator: Broadband is necessary

Submitted by acohill on Sun, 10/31/2004 - 09:27

In the Northern Neck of Virginia, broadband is being viewed (appropriately) as a critical economic development issue.

One of the most interesting items in the article is near the end, where an independent ISP that has been reselling DSL via Verizon infrastructure for some time is now in trouble. For a long time, Verizon said there was not enough business in the Northern Neck to justify the investment. So this independent firm sold DSL. Now that the market has been opened by its competitors, Verizon has stepped in and begun selling DSL for less that it charges for wholesale circuits to its competitors.

Verizon has every right to do that, and I don't think communities ought to waste time and effort trying to "get" telcos and cable companies to behave differently. They have to answer to shareholders, not the community.

But the article highlights clearly what communities are facing: a marketplace monopoly (rather than a regulated monopoly) in which the community has only one or two large broadband providers that are able to act in cartel-like behavior, setting prices and services options because of lack of competition. If affordable broadband is an economic development issue (and I think it is), then the community places its economic future in the hands of the big telecom providers unless the community itself makes some investments to level the playing field.

In the last paragraphk, the article quotes the county administrator of Westmoreland County, who worries about investing in the wrong technology. It's a valid concern, but it's not an excuse for doing nothing. And that issue is managed in two ways: communities need to plan for telecommunciations, just like they plan for everything else. Secondly, communities should invest in things that don't become obsolete quickly--telecom duct, fiber, tower sites, antnennas, and colocation facilities. Fear of the unknown (otherwise called ignorance) is putting the economic future of communities at risk. But ignorance is easily correctable--as I've said for nearly a decade--this is an education problem, not a technology problem.

New group forms around fiber to the home

Submitted by acohill on Wed, 10/27/2004 - 07:57

from a mailing list....


With the number of communities linked with fiber-to-the-home rapidly growing, a new coalition has been formed to educate consumers about the benefits of optical access networks. Max R. Kipfer, founder and president of Fiber Optic Communities of the United States (FOCUS), said the group would "unite fiber-optic communities from urban, rural, and suburban settings with the aim of propelling America into the next generation of communication."

During a press briefing in Washington, FOCUS General Counsel Lawrence Freedman said one of the group's missions would be to promote the sharing of information and dissemination of strategies among communities seeking to connect homes and businesses with fiber-optic networks. "All of the best technology will be of no use if there's not the transactional structure and operative environment" that's needed, he said.

The press briefing featured presentations on fiber-optic deployments from representatives of the Utah Telecommunications Open Infrastructure Agency (UTOPIA), a government effort to build a fiber-optic network covering 14 towns in Utah; Jackson (Tenn.) Energy Authority, which has built a fiber-optic network; and Brambleton Group LLC, which is installing fiber optics in its development in Loudoun County, Va.

Link Hoewing, assistant vice president at Verizon Communications, Inc., highlighted his company's plans to install fiber to the home in 100 central offices in nine states, passing 1 million homes, by year-end, and to pass 3 million by the end of 2005. Verizon has been expediting its deployment after receiving favorable regulatory decisions on fiber-related issues, he added.

Mike Render, president of Render Vanderslice and Associates, said fiber-to-the-home deployments had "taken off in the last six months," in large part due to Verizon but also due to several new "wired communities." There are now 217 communities in the U.S.

Color iPod displays pictures

Submitted by acohill on Tue, 10/26/2004 - 13:59

Apple has upped the ante in the portable music player world. With a half dozen other hard drive-based models trying to steal market share from Apple, the world's premiere technology innovation firm has released two new iPods today that will display digital photos on a color screen.

The iPods are available with 40 gig or 60 gig hard drives, and will store up to 25,000 high resolution color photos or up to 15,000 songs, or a combination of both. Apple has neatly solved the problem of what to do with all those photos being taken with digital cameras.

Storing your photos on your iPod as well as your desktop computer is good from another angle--it provides you with backups of your irreplaceable baby pictures. You do make backups of all your important files, don't you?

Apple has taken the iPod one step further and provided a TV-out connector so that you display slideshows on a television or LCD projector. All this comes with the original functionality of the iPod, including text note storage and viewing, games, calendar, and address book, and all in a package the size of a deck of cards. All iPods work on both Windows and Macintoshes, including the new color iPods.

Supercomputers as economic development infrastructure

Submitted by acohill on Tue, 10/26/2004 - 09:27

About this time last year, Virginia Tech, right here in rural Appalachia, made world news with a dirt cheap supercomputer that ranked number 3 in the world in terms of speed and processing power.

The university did some thinking out of the box and discarded the conventional approach to building supercomputers (typically using a lot of custom hardware). Instead they bought 1100 off the shelf Macintoshes, wired them together with more off the shelf hardware, and wrote a small amount of software to turn the Macs into a monster supercomputer.

Since then, the university has swapped out all the older G4 processor-based machines for much smaller Macintosh Xserve industrial servers based on the much more powerful G5 processor. The floor space needed for the machine shrunk, the heat output was reduced, and speed was increased by 19%.

I remain convinced that a regional supercomputer facility should be regarded as essential economic development infrastructure. Microenterprise businesses and other small businesses increasingly need access to supercomputing facilities, and this is no different that sewer and water was forty years ago.

The good news is that putting a supercomputer together is pretty easy. Apple will build you a turnkey G5 cluster so you don't need a research university. And for a rural community seeking an edge in the global economy, I can't think of a better calling card. A modest supercomputer facility would not cost as much as a shell building, and would be a perfect complement to a business incubator.

We've found the killer app

Submitted by acohill on Mon, 10/25/2004 - 07:58

All through the nineties, and especially during the dot-com silliness, hundreds if not thousands of companies talked about the "killer app." Usually those who claimed they had it were making some thinly veiled sales pitch for some proprietary piece of software that they believed would make them kings of the world.

I argued, at the time, that the killer app was email, and I still think I was right. Email is one of two things that virtually everyone does online. The other is search, and of course, the founders of Google, if not kings of the world, are now insanely rich.

But Google was never designed to be the killer app; no one was sure where search tools were going to go; they just happened. Alta Vista, the first search tool that tried to index the Web, was really started in large part to show off the power of DEC's processors, which weren't doing well in the marketplace. Alta Vista's early lead was squandered and DEC was bought out by Compaq, which killed the once powerful company, and Compaq was bought by HP. Ho hum.

Broadband connectivity has largely escaped the killer app disease, but in an odd kind of way. The broadband giants (i.e. telcos and cable companies) have pretty much failed to recognize that broadband is not that interesting unless you can do something with it. The big connectivity companies of the dot-com era (e.g. Global Crossing, UUNet, etc.) all collapsed because they utterly ignored the very sensible question, "What will people do with the bandwidth?" Consolidation in the cable business has been driven in large part by the enormous debt wracked up by cable companies trying to get broadband marketshare in advance of having even the slightest idea what people would do with it.

The killer app for broadband is going to be Voice over IP, or in simpler terms, telephone calls. We're already at a point where you can pretty much buy WORLDWIDE flat rate calling for under $40/month. Free point to point telephony software drives that cost down to zero.

We ought to stop calling the phone companies, well, phone companies. They aren't anymore, whether they like it or not. They have no choice but to become broadband companies, and just one of numerous services they offer happens to be dialtone.

In his remarks to the Voice on the Net conference in Boston on October 19th, FCC Chairman Michael Powell has called VoIP a "revolution." Powell went on to call for "bare DSL" access, meaning you can buy DSL service without being forced to buy bundled telephone service.

He went on to say something even more remarkable by outlining what he calls the Internet Consumer Freedoms:

  1. Freedom to Access Content: Consumers should have access to their choice of legal content;
  2. Freedom to Use Applications: Consumers should be able to run applications of their choice;
  3. Freedom to Attach Personal Devices: Consumers should be permitted to attach any devices they choose to the connection in their homes; and
  4. Freedom to Obtain Service Plan Information: Consumers should receive meaningful information regarding their service plans.

The Consumer Freedoms that Powell outlines are breathtakingly simple yet incredibly important. They underscore the need for communities and organizations to have a competitive marketplace for broadband services--monopoly providers have no incentive to meet Powell's requirements.

It is exciting that Powell has laid this out so plainly. What's going on? Well, another part of his remarks calls for exclusive Federal regulation of Voice over IP. If the alternative is a mish mash of fifty different sets of state rules that are likely heavily influenced by corporate contributions, that may be the right direction, as long as Federal regulation is as light as possible. It appears Powell understands this.

download Michael Powell VoIP remarks).

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