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Tuesday, December 02, 2008

Pioneering Download Site CinemaNow: Worth Just $3 Million

(Of course I didn't abandon my beloved CinemaTech... just took a long Thanksgiving vacation.)

Feels important to note that earlier this month, the pioneering digital download site CinemaNow was sold for a piddling $3 million to Sonic Solutions, a company that makes DVD-burning software. Founded in 1999 (before Movielink, and way before iTunes), CinemaNow had raised more than $30 million. Lionsgate Entertainment had been the main investor in the company, which offered rentals, downloads, and also the ability to burn some movies to a DVD.

Earlier this year, Curt Marvis, the long-time head of CinemaNow, shifted over to a digital media gig at Lionsgate.

Here's the official press release.

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Wednesday, November 05, 2008

Disney, 'Sleeping Beauty,' and 'Kitt Kittredge': Help Me Understand This


I freely admit that sometimes I am not the brightest bulb in the chandelier, so perhaps you can help me understand this...

While I was on my book tour in October, I kept seeing ads on billboards and bus shelters for Disney's release of 'Sleeping Beauty.' (I also read this review in the New York Times.) Disney refers to this as the first of its "animated classics" to be released on Blu-ray.

There are two options for those who want to buy 'Sleeping Beauty.' For about $24 on Amazon, you can get a package that includes a Blu-ray DVD and standard-definition DVD. (The Blu-ray disc has some interactive BD Live features, too.) Or for $15, you can get a two-disc standard-definition DVD set.

What you cannot do is download 'Sleeping Beauty' on Movielink, CinemaNow, iTunes, Amazon, or any other legal marketplace for digital movies.

I happened to have a chance to talk with two execs, one at Disney and one at Pixar, about the situation.

My point: why spend all that marketing money to remind people about the existence of a 50-year old movie if you're not going to offer it in all the formats people might want to watch it in?

Also, Apple said last year that there were 500 million active iTunes users, and about a million new downloads of the software every day. The most optimistic projections about Blu-ray players envision that there will be about ten million of them in use by the end of this year. (And yes, that includes those built in to Sony's PS3 game console.)

So you're going to spend millions of marketing dollars to sell to a potential audience of 10 million instead of 500+ million? I own some Disney stock, and that don't make sense to me as a shareholder.

I heard a number of rationales for why Disney would re-release a classic on disc, but not make it available to families that wanted a digital download to watch on their laptop, iPhone, or iPod. Among them:

    - We'll eventually do a digital release of 'Sleeping Beauty' and we'll do another marketing campaign then.
    - 'Sleeping Beauty' is more targeted at Disney-philes and collectors, not actual children
    - We want to promote the Blu-ray platform
    - We feel people will be confused by our promotion of Blu-ray and BD Live as a high-quality, interactive, high-pixel-count experience...if they are also presented with the option to buy a lower-quality digital version.
    - You have to master a movie all over again especially for the download version.
    - Movies sold on iTunes just don't look very good. (This ignores the fact that iTunes, Movielink, and CinemaNow all support HD or near-HD content.)


Contrast Disney's approach to the one Warner Bros. took with its release of 'Kitt Kittredge' last week. The movie is available on iTunes, Movielink, or Amazon as a $3.99 rental or $14.99 download. (For some reason, the download on Movielink is a bit more expensive.) The $16 standard-def DVD comes with a digital copy for your PC or Windows portable media player, as does the $27 Blu-ray disc.

(Unfortunately, the Warner Bros. "digital copy" won't play on the iPod or a Mac. That's a problem, and it makes Apple owners feel like they're paying for something extra that they can't enjoy. But at least interested viewers can purchase an iPod/Mac-compatible copy from Apple.)

So would someone explain to me how the Disney strategy makes sense?

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Saturday, August 23, 2008

Movies You Can't Buy Online

Ever try looking for some of your favorite movies on iTunes, Amazon Unbox, Movielink, or any of the other legal download destinations?

Odds are good that you won't find them.

I wanted to write about the issue, so I put together a list of fifty great movies (celebrated by the AFI, Roger Ebert, and Time Magazine) and all-time box office champs that you can't buy or rent online.

Here's the Variety article on the topic. One reason that you can't find movies like the James Bond series, 'The Godfather,' and 'The Lion King' is likely that they haven't yet been released on Blu-ray disc yet, and the studios are sure they'll make more money on selling high-def discs than they can with $9.99 iTunes downloads.

My favorite quote in the piece is from Jim Flynn, who runs the download sites EZTakes and iArthouse: "The pirates in general have a download exclusive," he says. "These movies are available as downloads -- just not legal ones."

Here's my list of fifty great movies you can't buy or rent legally on any of the major download sites (iTunes, Unbox, Movelink, and CinemaNow). Have you discovered others? Add them in the comments.

Fifty Movies You Won't Find Online (Legally)

Almost Famous
Amadeus
Annie Hall
Apocalypse Now
Brazil
Brokeback Mountain
Bubble
Butch Cassidy and the Sundance Kid
Citizen Kane
City of God
Double Indemnity
Drunken Master (1 or 2)
E.T. The Extra Terrestrial
Fantasia
Farewell My Concubine
Fargo
Forrest Gump
The Godfather I-III
Gone With the Wind
The Graduate
It’s a Wonderful Life
A Hard Day’s Night
Hotel Rwanda
Jaws
King Kong, 1933 original and Peter Jackson’s 2005 re-make (the 1976 Jessica Lange version is available)
La Dolce Vita
Miller’s Crossing
Munich
My Big Fat Greek Wedding
My Fair Lady
Nashville
Notorious
Pulp Fiction
Purple Rose of Cairo
Raging Bull
Raiders of the Lost Ark
Rear Window
Roger and Me
Saving Private Ryan
Schindler’s List
Sex, Lies & Videotape
Shrek 1, 2, and 3
Snow White and The Seven Dwarfs
The Sound Of Music
Star Wars Episodes I-VI
Titanic
The Wizard of Oz
12 Angry Men
2001: A Space Odyssey (but 2010: The Year We Make Contact is available)
28 Up

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Monday, August 11, 2008

EZTakes launches a new site for the artsy cinephile

Anne Thompson noted this morning that the guys at Massachusetts-based EZTakes, one of the first download sites to do the burn-a-DVD-on-demand thing, have launched a new site called iArthouse.

It'll compete primarily with Jaman, another site focused on foreign, arthouse, and independent titles.

iArthouse, so far, is just a rebranding of EZTakes.com without some of the schlockier stuff -- no "Extreme Sports" category, for instance, and no Troma movies like "Toxic Avenger." But other than that, the fare is virtually identical: here's the drama category on EZTakes, and here it is on iArthouse.

I called Jim Flynn, co-founder of EZTakes, to see what's up. He told me that there aren't any new titles up on iArthouse yet that weren't on EZTakes, but he expects about 30 titles from Kino International to show up within the week.

Flynn acknowledged that EZTakes isn't selling as many downloads as iTunes (50,000 a day), but that he wouldn't reveal specific numbers. He said that EZTakes received a "multi-million dollar" investment in January from a private investor, in addition to the several million that he and co-founder Bill Clarke have already put in. As of the start of 2008, Flynn says the site is profitable.

Here's a graph from Alexa comparing the traffic of EZTakes to that of Jaman, CinemaNow, and Movielink. Interesting that Jaman has twice the traffic of EZTakes. Obviously, Web site traffic doesn't equal downloads -- you can visit without buying or renting -- but it's the best approximation we've got.

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Monday, November 05, 2007

In Variety: "Studios' Digital Dilemma"

I have a piece in Variety this week that is basically a state-of-the-market report on digital downloading of movies. It argues that Apple is becoming the Wal-Mart of this new medium -- and that that has big implications for studios and independents. From the opening:

    Like Wal-Mart, Apple seems to be flexing its muscle to dictate terms to studios and indie producers. iTunes is a digital "big box" store to be reckoned with, and the choices Steve Jobs' company makes and the conflicts it faces will likely shape the way movies are consumed over the next decade.

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Thursday, June 28, 2007

Two iPhone pieces from Variety

I was hoping to avoid contributing to the orgy of iPhone hype this week, and in fact have summarily been deleting PR pitches that begin, "If you're planning to write about the iPhone..." I got at least a half-dozen of those.

But I failed.

I spent this afternoon working on a piece for Variety about what the iPhone means for media companies and content creators, which is here. I hope it's sufficiently skeptical...since I try to hold Apple's feet to the fire for operating a closed-loop system with the iTunes Store and the iPhone/iPod.

From the piece:

    If the phone is a hot seller, that could nudge more media companies to do deals with Steve Jobs' company -- or find a way to circumvent the tight link Apple has forged between its devices and iTunes, its online media marketplace.

    Apple's newest product will play a selection of 10,000 free videos from YouTube, as well as video podcasts offered for free on iTunes from outlets like CNN and HBO, plus movies and TV shows sold on iTunes by suppliers such as Disney, Lionsgate, NBC and ABC.

    But like the video iPod before it, the device won't play content sold by sites including Amazon Unbox, Movielink or CinemaNow, which offer movies in a Windows Media format that Apple doesn't support. Apple also doesn't allow content marketplaces other than the iTunes Store to sell content "wrapped" in Apple's FairPlay digital rights management (DRM) technology. That restrictive policy guarantees Apple a high degree of loyalty among iPod and iPhone users but has recently brought scrutiny from European Union regulators.

There's another piece, by Michael Schneider, about how everyone in LA is coveting an iPhone as the new status symbol.

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Monday, June 11, 2007

What's So Scary About iTunes?


Why do Sony, Fox, Universal, and Warner Brothers opt not to sell their movies on iTunes?

Three big reasons:

1. They worry about Apple being the only game in town, as far as digital distribution; on the music side, Apple controls more than 70 percent of the download market. That kind of dominance gives Apple the power to dictate price, and all kinds of other deal terms, to their suppliers.

2. They worry about encouraging consumers to stop buying DVDs. DVDs are the studios’ cash cow – they brought in almost $25 billion in 2006. The studios are also hoping that high-def DVDs will keep consumers shelling out $25 for a physical product that they can own – as opposed to $14.99 for a digital download.

3. Apple’s Steve Jobs isn’t making studios happy with his anti-DRM crusade. Remember, studios have always been more aggressive with copy-protection on DVDs than the music industry has been with CDs (you need special, illegal software to rip a DVD onto your laptop).

The transition from DVDs to digitally-delivered content is going to be painful. Consumers aren’t willing to put up with punitive DRM constraints, and they’re not going to pay the same price for a digital file as they did for the DVD.

But do I believe that there are going to be lots of new opportunities in the digital world that didn’t exist in the world of DVDs and videotape? Absolutely. Studios have just been slow in chasing them. There are classic movies people are dying to see – if studios would only clear the rights and make them available online. People would be willing to pay 99 cents to buy scenes from their favorite movies to store on cell phones and video iPods – if studios would sell them. If studios offered some of their best behind-the-scenes footage and making-of featurettes (the stuff that appears on DVDs as bonus material), film fans and wanna-be directors would buy those.

Studios simply haven’t put enough digital product out there, with innovative pricing models, for fear of cannibalizing DVD sales and antagonizing big DVD sellers like Wal-Mart and Target. That’s fostering piracy, and it’s allowing Apple to emerge as the dominant player in digital distribution.

If the studios really want to help create a strong rival to iTunes, why aren’t they giving exclusive content (like celeb interviews) to Amazon.com’s Unbox, or packaging a free download of the soundtrack with a purchase of a digital movie file? Why aren’t they promoting Movielink, a service they created in 2001 but have since let wither, or CinemaNow, which is majority-owned by Lions Gate?

Here’s the LA Times article that got me thinking about this…

…and also in the news today are some hints that Apple will start renting movies on iTunes this fall. (Stories in Forbes and the Financial Times). Would rental make it easier for more studios to play with iTunes? Yes, particularly if Apple is willing to let them offer movies for rental only. Retailers wouldn’t feel threatened, since they’re not in the rental business. But it’d be time for Netflix to start sweating…

As for Apple and iTunes...why not open the gates to indie content while the studios dither, rather than letting other sites (like Jaman.com) become the go-to destinations for lesser-known but high-quality films?

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Tuesday, June 05, 2007

For Indie Filmmakers: How to Sell DVDs Online


I had drinks in San Francisco this evening with Jamie Chvotkin, who is the founder of FilmBaby.com, a site that helps indie filmmakers market their DVDs. (Here are the details of how the site works; basically, you send them DVDs and they take a $4 cut from every unit sold.)

I had lots of questions for Jamie, who I'd bumped into once or twice at South by Southwest and other events, but my main focus was this: what are filmmakers doing to move discs on FilmBaby? Later, we talked about some of the new sales channels FilmBaby is developing with partners like Netflix, Google, CinemaNow, iTunes, and Urban Outfitters.

I asked Jamie about some of the site's best-sellers. His answer: documentaries perform best.

The site's best-seller is 'Heavy Metal Parking Lot, a 16-minute documentary (with two hours of bonus material) shot in 1986 at a Judas Priest show. That movie, Jamie says, was already "an underground cult classic" before it came to FilmBaby. He estimated they've sold more than 8000 DVDs through the site. (By my math, at a $19.95 per unit price, that's more than $125,000 in the filmmaker's pocket.)

'The Star of Bethlehem', a Christian-themed astronomy doc, has also done well, selling about 2000 units on the site. 'Inside Iraq: The Untold Stories' also sells steadily. Filmmaker Mike Shilely "tours colleges constantly showing the film, and he's really great at working the local press to get coverage," Jamie said.

His theory is that docs sell better than features on the site because if someone is interested in a topic, they're willing to give the movie a try even if they've never heard of the filmmaker. 'Dark Water Rising' appeals to both animal lovers and people interested in the Katrina disaster: it deals with animal rescues in the wake of the killer hurricane. 'Art of the Bow', a three-hour instructional film for upright bass players, is priced at $79.95 -- and about 400 copies have been sold on FilmBaby.

Features are a tougher sell. 'Fishing with Gandhi / Cow Monkey' is one of the site's better sellers, about two brothers who set off to hunt Big Foot. Every copy is autographed by the filmmakers, Jamie said. "They also have a funny trailer, and it's clear that the production values are good," he added. That title has sold a few hundred copies.

That got us talking about trailers. "You need a great trailer, and most indie filmmakers have no idea how to make a trailer," he said. (I pointed out that most Hollywood directors don't make their own trailers; they hire movie marketing shops that specialize in trailer production.) Jamie said filmmakers should at least resist making a six-minute long trailer. He said 'Star of Bethlehem' has a good one.

Jamie emphasized that it's a filmmaker's responsibility to think creatively about how to generate interest in her project. "You need a promotional strategy, a game plan to get your film out there." Posts on message boards and blogs are helpful, but so is mainstream media coverage; when Gilbert Gottfried does a guest spot on Howard Stern's show, his DVD sales on FilmBaby skyrocket. Think of online distribution as a grocery store, Jamie suggested. "The reason Pringles sell is because that company advertises them," he said.

Jamie said FilmBaby is trying to create lots of other opportunities for filmmakers. He has just started to send a list of all the new DVDs added to his site to Netflix, and Netflix has bought a few for its members. (Jamie made it sound like Netflix has bought fewer than 10 titles so far, but the program just began.) Netflix seems to like DVDs that have a wholesale price of about $12, he said, and they buy a minimum of about 40 copies. Filmmakers don't see any kind of rental royalties after the sale.

A deal with Super D helps make FilmBaby's library of 2000 titles available in 2400 retail stores, as retailers choose to order them.

FilmBaby is just beginning to sell content on Google Video, starting with a video from impressionist Frank Caliendo. Jamie says the volume isn't all that high -- at $8.00 for download-to-own, and $2.10 for a day-pass, Caliendo is making about $250 a month. "He's probably making thousands a month from his audio content on iTunes," Jamie said. He's planning to digitize the entire FilmBaby library and put it on iTunes. This summer, FilmBaby may start offering a "digital only" plan, for filmmakers who aren't interested in selling DVDs.

FilmBaby will also have a first batch of titles up on CinemaNow this July, according to Jamie; that service is planning to add about 15 new FilmBaby movies a month. Later in June, the 'Ask a Ninja' compilation will start showing up in Urban Outfitters stores, thanks to a deal FilmBaby arranged.

Jamie agreed when I suggested that it'd be helpful if we had a break-out hit -- an indie movie that sold a million copies as a digital download, or a DVD sold online. "That'd be great for the indie film community," he said, "whether they sell them through us or CinemaNow or iTunes [which still isn't open to indie content, though Jamie has been in discussions with them.] It'd be a shot in the arm, especially for filmmakers who are skeptical of the do-it-yourself distribution routine."

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Wednesday, May 30, 2007

New survey data on movie downloading behavior

Toronto-based Solutions Research Group surveyed 1,230 Americans earlier this month, and found that:

    - Only 8 percent have paid to download a movie (up from 5 percent in October 2006)
    - 30 percent of iTunes users have visited the movie section of the store. Among visitors to Amazon.com and WalMart.com, 10 percent and 8 percent, respectively, have visited the movie areas of those sites.
    - A third of all Netflix members use Netflix's "instant viewing" feature to watch movies (or parts of movies)
    - Among other movie download sites, 9 percent of survey respondents had visited Movielink.com, 8 percent had visited BitTorrent.com, 5 percent had visited Vongo.com, and 5 percent had been to CinemaNow.com.

A PDF summary of the survey results is here.

(Via Movie Marketing Blog)

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Sunday, April 08, 2007

Internet Movie Marketplaces: Who's Most Likely to Succeed?

Who’ll end up as the Blockbuster of Internet movie distribution?

No one has all the elements in place yet: big audience, vast selection, intuitive design, and a simple way to transfer movies onto portable devices and the living room television.

But here’s my ranking of the five players that are “most likely to succeed” in the business of digital distribution.







1. iTunes Store

The big dog. Works for both Mac and PC users, and as of April 2007, had sold 50 million TV shows and two million feature films. New $299 Apple TV device makes it easy to wirelessly transfer iTunes content to a television and view it there. The negatives: no rentals (only download-to-own, at $9.99 and up), no way yet for indie producers to sell their content, no simple way to burn shows or movies from iTunes to a DVD. Also: only a few studios offer features on iTunes, including Disney, MGM, and Lionsgate. Paramount supplies older films -- not new releases. Others have so far been reluctant to cut deals with Apple CEO (and Disney board member) Steve Jobs.

2. Amazon Unbox

Unlike iTunes, Amazon Unbox makes movies available for digital rental and purchase. Movies can be sent directly to an Internet-connnected TiVo device for viewing on a TV. While Unbox hasn’t yet built much momentum in the marketplace, Amazon has a built-in advantage over the other players on this list: hundreds of thousands of consumers already trust the company with their payment information, and have Amazon accounts already. Amazon can also make movie recommendations based on past purchases.

Indie producers can make their content available on Unbox using Amazon’s CustomFlix service, and keep 50 percent of the revenues. That makes Unbox the most “long tail”-friendly movie service. Among the studios offering features: 20th Century Fox, Lionsgate, Universal, Paramount, Sony, MGM, and Warner Bros. Movies from Lionsgate, Sony, Warner Bros., and Fox. Works well with Windows-compatible portable devices like the Creative Zen Vision. PC only.

3. CinemaNow


CinemaNow has been in the movie download business longer than most anybody else: since 1999. It helped pioneer technology to download a movie and then burn it to a DVD (more than 100 titles are now available, mostly older movies), and CinemaNow also hasn’t been prudish about offering “mature content,” working with porn providers like Vivid and Hustler. CinemaNow is the only service working with all six major Hollywood studios. Offers some movies for free, as ad-supported streams. Movies can get to TV with a Windows Media Center Edition PC, and to Windows-compatible portable players. PC only.

4. Vongo


Vongo is unique in offering an “all you can eat” movie service for a dirt-cheap $9.99 monthly fee. About 1000 movies are available at any given time, but some titles rotate in and out of inventory. Works with various Windows systems (Media Center Edition, Vista Ultimate, Xbox 360) to display content on a TV. Content can also be synced with Windows-friendly portable media players. Vongo also offers a live, streaming version of the Starz TV channel. Rental only, PC only.

5. Microsoft Xbox 360 Video Marketplace


Microsoft has sold more than 10 million of its Xbox 360 gaming consoles, as of December 2006. The video marketplace offers standard-def and high-def features from Warner Bros., Paramount, Lionsgate, and New Line. (As of April 2007, Xbox and CinemaNow are the only of these services offering movies in high-definition.) Rentals only; no download-to-own. High-def new release movies cost $6, and standard-def new releases cost $4. Since the gaming console is already connected to a TV, viewing on the big screen is a breeze.

Dark horses (in no particular order)


MovieLink: Initially launched as a joint venture of several major studios, but never well-promoted. Blockbuster is reportedly interested in acquiring Movielink – which could help introduce the service to a wider audience, especially if Blockbuster ties in digital downloads with rentals from its retail locations.

ClickStar: Offers both rentals and downloads. Some movies, like “10 Items or Less,” will appear on Clickstar just a few weeks after their theatrical debut. Biggest things ClickStar has going for it: the involvement of Morgan Freeman and his producing partner, the supremely tech-savvy Lori McCreary.

Netflix: Digital downloads are now built into Netflix’s monthly subscription package. About 1000 titles available, which could grow to 5000 by the end of 2007. Streaming only, PCs only.

Wal-Mart: Expect Wal-Mart to offer the cheapest prices, if not the most compelling user experience. Launched in February 2007.

Joost: Viacom announced a deal in February 2007 to make movies from Paramount and MTV Films available on Joost.

BitTorrent: Download or rent movies from Fox, MGM, Paramount, and Warner Bros. Bit Torrent’s advantage is zippy peer-to-peer download speed.

GUBA: Partnerships with Warner Bros. and Sony.



Some other comparisons of Internet movie marketplaces:

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Thursday, April 05, 2007

Three Worth Reading: Incompatible Movie Formats, TiVo's Web Smarts, and More Burton in 3-D

- Stephen Wildstrom of BusinessWeek writes about the many incompatible formats and viewing options for digital movies. He writes:

    The problem is that the quickly growing stock of movies and shows available for download is scattered among an assortment of stores including Movielink, CinemaNow, Google Video (GOOG), and Amazon.com (AMZN) Unbox, as well as Apple's (AAPL) iTunes Store. And while there's a lot of overlap, there's also a significant amount of content exclusive to one or another service.

    This has happened because the digital-download business isn't like any other sort of retailing. Any bookstore can order any book in print from its publisher. And once customers buy it, they can do whatever they wish with it. But download services must negotiate their rights studio by studio, sometimes title by title. And the deals cover not only which movies and TV shows are available but also what sort of video quality can be offered at what price, and, in excruciating detail, just what consumers can do with the video they have bought or rented.

    Consider the rules covering movies purchased from Movielink, typically for $13.99 (different rules cover rentals). You can watch your movie as often as you want, but only on a Windows PC. Some films can be watched on up to three different PCs; others can't. You can make a backup copy to DVD, but you must copy it back to a PC to view it; you can't watch it on a standard DVD player.


- David Pogue of the NY Times appreciates TiVo's recent efforts to create a simple, useful connection to the world of Web video, including the ability to download movies from Amazon Unbox.

- Disney is converting one of Tim Burton's first animated shorts ('Vincent') into 3-D for this fall's release of 'The Nightmare Before Christmas 3-D,' according to The Hollywood Reporter. Carolyn Giardina writes:

    Made in 1982, "Vincent" is a six-minute stop-motion film that tells the story of Vincent Malloy, a youth who imagines that he is like Vincent Price. The black-and-white short is based on a poem written by Burton, who was influenced by Price. Price narrated the film.

    "When you have an evergreen title like 'Nightmare,' it is very important to give the fan a chance to sample something new," said Chuck Viane, president of Disney's Buena Vista Pictures Domestic Distribution. "Each year on bring backs, we are going to try to add some value."

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