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Welcome to TVBR's Daily Epaper
Volume 22, Issue 199, Jim Carnegie, Editor & Publisher
Tuesday Morning October 11th, 2005

TV News®

Jefferson-Pilot sold
to Lincoln Financial

Another broadcasting company is changing hands in a big deal, although Jefferson-Pilot Communications is but a small part of this 7.5 billion cash/stock deal to merge Jefferson-Pilot Corporation into Lincoln Financial to create an insurance industry giant. While Philadelphia-based Lincoln hasn't been in the broadcasting business, it plans to keep the radio and TV group. "Beyond our strength in financial services, the new company will have an extremely attractive portfolio of broadcasting assets in Jefferson-Pilot Communications. This is a unique and strong franchise, which will provide earnings diversity to Lincoln and an additional outlet for publicizing the Lincoln Financial Group brand and remain a key part of the overall organization," said Lincoln Chairman and CEO Jon Boscia, who will keep those titles for the merged company. Jeff-Pilot President and CEO Dennis Glass will become President and COO of Lincoln, post merger. Under the deal, which still needs several regulatory approvals, Jeff-Pilot shareholders will receive 1.0906 share of Lincoln, or 55.96 cash for each Jeff-Pilot share. The cash portion will be limited to 1.8 billion and pro-rated if oversubscribed. The companies say that works out to a blended stock/cash consideration of 55.48 per Jeff-Pilot share, an 11% premium to the recent average price. The companies say they expect 180 million in pre-tax annual savings from combining the two insurance companies. As you would expect, Jeff-Pilot's stock price shot up yesterday to just below the merger value.

TVBR observation: The value of the Jeff-Pilot Communications subsidiary wasn't broken out from the main deal. However, Jeff-Pilot supplies considerable financial data about the broadcast operation, although it doesn't separate radio and TV, so we can come up with a ballpark figure. The broadcast division had 239 million in revenues in 2004, about 6% of the company's total of 4.1 billion. Net income for broadcast was 54 million, about 10% of Jeff-Pilot's total of 563 million. Lincoln and Jeff-Pilot say broadcast will account for about 4% of the merged company's operating income. Jeff-Pilot Communications reported broadcast cash flow of 108 million for 2004. If we apply a blended 12 times multiple, the value of the broadcast stations in this deal is roughly 1.3 billion. After looking at BIA figures, out best guess is that radio accounts for about 63% of revenues and cash flow, so we're calling this deal 820 million for radio and 480 million for TV.

Kids/FCC in tug of war between programmers, watchdogs
FCC regulations on children's broadcasting, including weekly time requirements, additional requirements for multicasters, spot limits and the relationships between what's broadcast and what's on a related website, are under attack. From both sides. Watchdogs like the United Church of Christ and the Center for Digital Democracy don't think the rules go far enough. Big broadcast and cable networks, on the other hand, say the opposite, that they go too far, violate First Amendment rights and are beyond the scope of the FCC's authority. At issue are the three hours of educational children's programming broadcasters are supposed to air weekly, the extension of that requirement to all digital multicast channels (with some built in time-trade-between-subchannel flexibility built in), restrictions on minutes-per-hour which can be used for advertising, and prohibitions on using a program's characters as advertising "spokespersons." Linked websites will be required to have a clear intention of existing for reasons other than advertising and marketing. FCC rules approved in 2004 are scheduled to go into effect 1/1/06. However, appeals are in - - the nets have filed in the Washington circuit, and the UCC in the Sixth Circuit, which encompasses its Ohio digs. Stay tuned.

Democrats keep the heat on Bennett
Rep. Jesse L. Jackson Jr. (D-IL) has officially made a federal case out of the comments of Salem Radio Network personality and former Secretary of Education Bill Bennett. He's filed a complaint with the Federal Communications Commission attacking the language - - not as indecent - - but as profane. "The Federal Communications Commission can regulate content that is profane," said Jackson. "Mr. Bennett's comments were indeed profane, so we have prepared a formal complaint to the FCC, asking that Mr. Bennett and his show's parent network, Salem Radio Network, be sanctioned. The FCC has defined profanity as 'including language that denot[es] certain of those personally reviling epithets naturally tending to provoke violent resentment or denoting language so grossly offensive to members of the public who actually hear it as to amount to a nuisance.' Mr. Bennett's comments meet that standard." Meanwhile, Rep. John Conyers (D-MI) is continuing to his pursuit of Salem - - and has shifted his focus from letters to the network to pressure on Bennett's advertisers. On his blog, he wrote, "While Salem Radio Network has not provided us a list of their sponsors, I understand that a number of other radio stations have such a list and are encouraging people to make calls and send emails. A groundswell of grassroots activity encouraged the Bennett sponsors to shrink. It will be interesting to see what becomes of the pressure on Salem."

TVBR observation: Jackson will no doubt have a very hard time pushing his definition of profanity at the FCC, with its primary focus squarely on the sexual and excretory. And in a media world where many rightly believe there is no such thing as bad publicity, a campaign such as Jackson's often backfires and actually raises the profile of the individual under attack - - just ask Howard Stern. Conyers' route, however, hits where it hurts - - the wallet. Although demographic targeting along lifestyle lines which mirror political lines can be beneficial in certain cases, as a general rule, America's advertisers of various goods and services do not check the politics of potential customers when they walk up to the cash register. If a particular show becomes too hot, there are plenty of other media outlets where they can spend their money. Stay tuned.

The grass isn't any greener
If you read our dismal report yesterday on how poorly TV stocks have performed through the first three quarters of this year, maybe you were thinking that things were better in radio. No way. If it's true that misery loves company, then TV execs will find it comforting to read these figures for radio stocks.
| View the Numbers |

Smulyan sees value in
baseball, ABC Radio

Wall Street may not like the idea of Emmis investing in Major League Baseball, but Jeff Smulyan remains committed. Elaborating on comments he made in last month's quarterly conference call, Smulyan noted in a Q&A posted on the Emmis website that investors didn't like him getting into TV either, but that's now been cashed out at a nice profit. Likewise, he thinks a potential 100 million investment in buying the Washington Nationals will pay off down the road. "While initially this was a possibility I was pursuing alone, it became clear that it made sense for Emmis to be involved. We looked at it, and we saw the total nature of the investment. Obviously the team is quite profitable, and on a cash-flow basis, the investment would be at a lower multiple than the TV assets we're in the process of selling. But we also believe there are some other opportunities that come with it - - cable TV rights, stadium-area development, participation in Major League Baseball's internet venture - - that are very attractive. People should also know that under the limited partnership we're organizing with DC investors, Emmis would not be liable for any debt from a purchase," Smulyan said. He also doesn't make any secret in his interest in acquiring ABC Radio - - put only if the price is right. So what happens if after stocking up with cash from the TV sell-off, neither of those deals becomes reality? "It's really hard to tell what Emmis will look like in the coming years. We have a vibrant company full of people who do great things. We want to grow, but we're not going to overpay to do it. We'll only do things that make sense for this company," Smulyan insisted.


Omnicom acquires ipsh!
Diversified Agency Services (DAS), a unit of Omnicom Group, has acquired San Francisco-based ipsh!, a mobile marketing services/technology company. "This acquisition represents a unique partnership with the convergence of traditional corporate communications and wireless services," ipsh! CEO Nihal Mehta said. "This partnership highlights the growing importance of the mobile phone as a viable marketing medium." "At Omnicom, we recognize growth markets and exceptional business opportunities that support our existing businesses and clients, so this acquisition is a perfect fit," said Tom Harrison, DAS CEO. "ipsh!'s ability to successfully implement mobile marketing campaigns for a broad range of clients across industries will give us a leadership position in the marketplace."

AOL launches national
effort for

AOL has launched a nationwide campaign for leveraging both traditional and online media. The effort is designed to highlight specific features of and is organized around four key themes: Entertainment (AOL Music, Moviefone, AOL Radio, AOL Sports, AOL Television and more); Finding news and information (AOL Search, Video News, VOD, Video Search and more); Convenience and getting things done (AOL CityGuide, AOL Living, inStore, MapQuest and more); and Connecting with others (E-mail, AIM, AOL Pictures and more). According to Kevin Conroy, AOL Media Networks EVP, "This campaign reaches web users where they are-online. With a changing media landscape, a multi-pronged approach, which also includes print, broadcast and outdoor billboards will more effectively reach today's consumer. And, by linking to our wide range of best-in-class programming and functionality, we're connecting consumers directly with the value that matters most to them within our new portal experience." To create and implement the campaign, AOL is working with Carat Fusion on Search Engine Optimization and Search Engine Marketing; Atmosphere BBDO for online creative and OMD for online media; and The Martin Agency with Initiative on Offline advertising. This multi-faceted ad campaign is intended to attract new users to and motivate AOL's existing audience to visit websites. The online ads, via Atmosphere BBDO, began running in August and focus on specific content areas to build awareness and take viewers directly into with one click. These ads will run through year-end on more than 100 websites, ranging from larger, integrated buys on websites like CNET or eBay to category specific buys on sites like or iFilm.

RAJAR news update
While we ponder the PPM here is the US, there is ongoing testing of numerous electronic measurement technologies for radio listening in the UK. According to the recent RAJAR (the UK's dominant radio ratings company) newsletter, RAJAR successfully issued its RFP in July for new listening gathering technologies and has delivered copies of the new specification to all interested parties.
| Excerpts from the newsletter |

Advertising Week 2005 facts & figures
The recent Advertising Week 2005 organizers have released some key preliminary facts & figures. More than 500,000 unique voters participated in the Yahoo!-administered poll for America's favorite icons and slogans, won by Juan Valdez, the GEICO Gecko, GE's "imagination at work" and Hallmark's "When You Care Enough to Send the Very Best." 14,000 users have tapped Infinity Broadcasting's pod casts of Advertising Week 2005 keynote & panel content . . . logging on for an average of 90 minutes.
| See more here |

Media Business Report
Clear Channel heating up Hispanic menu
Within the next year and a half, radio giant Clear Channel is planning to go Latin "...across a full range of market sizes." It plans Hispanic conversions for anywhere from 20 to 25 radio stations in markets where Spanish-speaking residents are currently underserved. Alfredo Alonso, who was once head of his own Hispanic group, Mega Communications, will spearhead the new CCU initiative. Alonso said, "My focus will be on identifying opportunities to bring Spanish language radio format to all-sized markets, with unique radio stations that are as diverse as the Hispanic market itself." CCU CEO John Hogan explained, "The Hispanic radio audience remains largely underserved, especially outside the largest markets. We have a unique chance to participate in this rapidly growing, important sector and are committed to creating the highest-quality offering in the market."

MBR observation: Clear Channel is under constant assault for having a political agenda, but this - - like its adoption of the liberal Air America network in many locations - - is further evidence that its primary political philosophy is the pursuit of profit, and it will go in whichever direction that pursuit takes it.

RBR/TVBR Special Salute to Radio & TV

Vigilance in a
Time of Crisis

In RBR/TVBR's November Solutions Magazine, we talk with WWL-TV GM Bud Brown and WWL-AM GM/Entercom Market Manager Phil Hoover about the importance of being two of the only stations that continued broadcasting throughout hurricane Katrina. These are great reads with touching stories about heroes, saving lives and helping those in need with information.

We all in the Radio and TV business have been trying to say - 'Thank You to the broadcast communities of New Orleans and Gulfport and everywhere else for upholding our end of the deal to the American public. May free broadcasting be forever.'

If you'd like to congratulate the broadcast community for showing what it does best, we still have a few ad positions available in this amazing 5-page feature.

Contact June Barnes at [email protected] at 803 731 5951or
Jim Carnegie at [email protected] at 813 909 2986

Washington Beat
Viacom takes a file hit in New Orleans
WUPL-TV, a Viacom UPN O&O on its way out of the portfolio, will have to settle up with the FCC. The Commission granted a license renewal to the station, but found gaps in its public file regarding its observance of children's content regulations. The gaps were for a handful of quarters going back to the Viacom's acquisition of the station in September of 1997. The FCC could not find a "pattern of abuse," and decided that the maximum 10K fine was not warranted in this case. It did hit the station with a fine, however, setting the penalty at 4K. Viacom has contracted to sell the station to Belo Corp. for 14.5M (7/11/05 TVBR #134).

TVBR observation: The Public File is one of the most important documents and everyone inside any station needs to know where it is and keep it updated. The FCC requires every station to have it maintained as FCC regional inspectors monitor compliance. FCC views all obligations seriously, as shown by the one that just hit Viacom. Do you know what should be in your Public File? No? RBR/TVBR in conjunction with FCC Lawyer Gregg Skall has compiled the vital info needed for your station(s) to keep you in compliance. This FCC Public File Report will be emailed soon to RBR/TVBR members only.

New commander for "Commander in Chief"
Normally you don't mess with success, so Hollywood was stunned when Touchstone Television replaced Rod Lurie as production boss for the new hit ABC series, "Commander in Chief," starring Geena Davis. Now in charge is Hollywood heavyweight Steven Bochco of "NYPD Blue" and "Hill Street Blues" fame. But it apparently wasn't just the availability of the bigger name that led to the change. Production delays reportedly had folks at Touchstone and ABC concerned and Bochco is expected to make things run more smoothly. Lurie, known mostly for his movie work, continues as executive producer.

Court TV buys Trial by Jury
Fans of the short-lived "Law & Order: Trial By Jury" are getting a reprieve. Time Warner's Court TV has picked up the rights to the cancelled NBC series and plans to begin running the 13 episodes - - including one that has never aired before - - in primetime beginning in December. The show, which stars Bebe Neuwirth as Assistant District Attorney Tracey Kibre and former United States Senator Fred Dalton Thompson as District Attorney Arthur Branch, tells its stories not only from the prosecution's point of view, but includes the perspectives of the defense attorneys, defendants, judges and jurors. TNT, another Time Warner network, has also acquired four TBJ "crossover episodes" featuring Jerry Orbach.

Ratings & Research
Western Europe will have
100 million DTV installations by 2009

Yankee Group reports that the arrival of digital terrestrial television (DTT) and IPTV services promises to transform the competitive landscape in Europe in the next 5 years. This crowding of the digital TV market will disrupt a traditionally disinterested pay-TV audience creating a surge in adoption. In the report, New Platform Competition Is Driving Digital TV Growth in Europe, Yankee Group examines the characteristics of the four digital television platforms--IPTV, DTT, cable and DTH--and assesses their prospects for success both in relation to each other and within the context of Europe's diverse country markets. Yankee Group highlights key initiatives by operators including Belgacom, BSkyB, FASTWEB, France Telecom, Free, Mediaset, Telefonica, Telewest and Video Networks Ltd to demonstrate the market's momentum. Yankee Group provides recommendations to providers on each of the four platform technologies, based on fundamental strategic goals of growth, differentiation and service deployment. "Free-to-air TV programming content has hindered the growth of European pay-TV markets, severely constraining operators' ability to upsell to premium or digital services," said Jonathan Doran, Yankee Group, senior analyst, Broadband & Media Europe. "Operators must pursue growth strategies that accommodate both their platform's technical capabilities and the local competition conditions to be successful." This Yankee Group report guides operators challenged with generating revenue and retaining subscribers in a competitive European multichannel video market.

Scarborough names Hispanic consumer groups
Scarborough Research released an analysis of Hispanics in the US and key emerging local markets for Hispanic consumers. The study unveiled five key Hispanic consumer segments, and then applied their characteristics to a local market analysis to identify the "next tier" of Hispanic cities.
| The five key Hispanic consumer groups: |

TVBR Stats
AOL: African Americans spend nearly double time online
African Americans are racing to the Internet in record numbers, according to the 2005 AOL African American Cyberstudy, conducted for AOL by IMAGES Market Research. They report spending more time on the Internet (5 hours a day vs. 2.9 hours a day for the general online population) and are closing the gap in Internet usage with nearly 80% of African Americans having access to the Internet (vs. 88% of the general population). And two-thirds of online African American households have a high-speed connection vs. 53% of the general population. Those currently not online are more likely to get connected within the next 6 to 12 months. The study also revealed that African Americans are embracing the Internet as an indispensable lifestyle tool and a tremendous resource. They are far more likely to use the Web to access a variety of information: news (68% vs. 56%), entertainment (55% vs. 26%), health related issues (72% vs. 53%), financial questions/needs (60% vs. 40%) and sports (39% vs. 26%). Other popular activities include: using a search engine (92%), communicating with family and friends (86%), using the Internet to get driving directions (85%), opening a bank account or online banking (62%) and listening to music online (62%). In addition, 62% of African Americans feel the Internet is helpful with individual career advancement and is a useful education tool (80%) for all ages. However, the study also found that an overwhelming number of African Americans say there isn't enough online content that "speaks" to them as a distinct culture with its own dynamic needs and values. The survey also found that almost three-quarters (73%) of African Americans were much more receptive to culturally diverse advertising. And 68% favor companies that benefit the African American community.
| See topline findings |

Stock Talk
Chapter 11 is never good news
A bankruptcy filing by auto equipment maker Delphi put Wall Street traders in a sour mood, not to mention a warning by Northrop that Hurricane Katrina will hurt its earnings. The Dow Industrials fell 54 points, or 0.5%, to 10,239.

TV stocks couldn't buck the trend. As you'd expect, the day's big gainer was Jefferson-Pilot, which is not a TV stock, but rather an insurance company that owns radio and TV properties. It rose 6% on announcement of a 7.5 billion merger with Lincoln Financial. Within the TV sector, Entravision fell 3.1% and Saga 2.6%.


Here's how stocks fared on Monday

Company Symbol Close Change Company Symbol Close Change





Media General












Clear Channel




News Corp.
















NY Times
















Saga Commun.












Gen. Electric




















Time Warner




Gray, C1. A




















Viacom, Cl. A




Journal Comm.




Viacom, Cl. B




Liberty Corp




Wash. Post






















Send Us Your OpinionsWe want to
hear from you.

This is your column, so send your comments to [email protected]

Channel numbering isn't the
only thing yet to be determined
about HD Radio.

Editor: Here are some questions that I don't think anyone has addressed.
Will the additional HD channels a station can operate be subject to the same identification rules that the analog and primary HD channels operate under, i.e. call letters and city of license? If so, this will determine how a subchannel can be identified. And will the other FCC rules such as lottery, political, pay-to-play and obscenity regulations pertain to the sub-channels?

Robert Conrad
WCLV 104.9 FM, Cleveland, OH

Clarifying a previous story.

In your story "Adelstein takes anti consolidation message to Iowa" (10/7/05 TVBR #197) a correction is needed. I'm Rick Sellers, owner of KMRY(AM) in Cedar Rapids, and you misquoted Mr. Keller, of KZIA(FM), also of Cedar Rapids. Mr. Keller said he was the only FM that is locally owned. (and that doesn't include the various public FM's) I'm one of two locally owned AM stations, the other is KCRG(AM) owned by the Gazette. There also is locally owned KCJJ, Iowa City. I know what Mr. Keller said as I was a panelist at this forum! I spoke of the pitfalls often occurring with consolidation: with consolidation often comes staff cutbacks. I spoke in specific about WMT AM/FM which once were regional powerhouses with dominant ratings. I was there for 23 years. Under CC, numerous positions and services were cut, and the ratings today are less than half of what they had been on both AM and FM. Meanwhile, I purchased my own standalone AM. I know WMT AM/FM's overall gross revenue has dropped, but also of course, have come expense drops with staff cuts. My point at the meeting was that the profits probably are roughly the same, so who loses? The public.

Rick Sellers
President-General Manager
Sellers Broadcasting, Inc - - KMRY-Cedar Rapids

October RBR/TVBR Digital Magazine

Ad Biz
Buyers, sellers address the
2006 radio upfront - Part II

Radio Programming
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TVBR Radar 2005
Television News you won't read any where else. TVBR--First, Accurate, and Independently Owned.

Mullen out at
Tribune Broadcasting
After several quarters of soft revenues for its TV group, which the company has been blaming on Nielsen's Local People Meters (LPM), Tribune Company Pat Mullen has resigned. TVBR observation: Pat Mullen has been one of the most vociferous opponents of LPMs. He wrote the May letter co-signed by 16 other TV groups which succeeded in getting Nielsen to temporarily delay its LPM rollout in Washington, DC and Philadelphia, although not in getting the ratings company to put the entire project on hold until it got all of its LPM markets accredited by the Media Rating Council (MRC). Mullen also testified on Capitol Hill against LPMs and in favor of Sen. Conrad Burns' (R-MT) to make MRC accreditation mandatory for any TV rating service. It will be interesting now to see if Tribune continues to be a leader in the campaign against LPMs, or if Mullen's successor - - yet to be named - - will decide to deal with the new ratings currency as a fact of life. PS: Do not be surprised to see more TV Presidents and CEOs out of work between now and end of first quarter 2006.
10/10/05 TVBR #198

Broadcast stocks still in doldrums
Three quarters of the way through 2005, investors remain sour on radio and TV stocks, with very few exceptions. The way to make Wall Street happy, it appears, is to sell assets. If you missed the total overview and all the Radio and TV stocks yet another quarter,
TVBR observation: Read 'em and weep here.
10/10/05 TVBR #198

Fox poaches Swanson from CBS
Having been passed over for the top TV O&O group job at the new CBS Corp., Dennis Swanson has been lured away by News Corporation to become President of Station Operations, Fox Television Stations Group. He'll report to work today, reporting to Jack Abernethy, CEO, Fox Television Stations Group.
TVBR observation: Rather than sitting back for a while and then drawing a retirement check from CBS (to go with the one he already gets from GE/NBC), Swanson was ready to take on a new challenge. Swanson was asked during the TVB conference this year when he would retire and his answer was, "When I stop having fun." This statement makes for one dangerous man as he feels no pressure and with the experience plus having fun is a pure formula for success.
10/07/05 TVBR #197

Stevens: Four goals of DTV bill
They include increasing public safety, advancing service to the American consumer, advancing the transition to DTV and finding a way to pay for it all. On the we-all-can-take-a-deep-breath-and-relax-a-little-bit front, Stevens noted that there was a certain futility to calls for move the hard deadline for the transition significantly forward.
TVBR observation: If 10/19/05 is going to be the big day, the Committee still has much to accomplish. One of the first things Stevens mentioned to MSTV was multicasting. One of the last things he said was that there was much he could not yet discuss - - including multicasting. That gives NAB and NCTA two more weeks to lock antlers.
10/06/05 TVBR #196

Mandel comments on Apollo issues
I think that the Apollo Project is a great idea. It's something that advertisers want. It will be, ideally, multimedia. And ideally, these things are paid for by the advertisers and the media companies and the advertising agencies - - all of the people that would use the information. And everybody has to put in equally. Everybody has the potential to get a benefit out of Apollo, so everybody should have some skin in the game..."
TVBR observation: One thing we respect about Mandel puts his money where his mouth is - period - and you always know where you stand when you go toe to toe with him.
10/05/05 TVBR #195

Consumer Reports gives
thumbs up to HDTV
Are all but unanimous in their praise of high-definition television." But what about consumers? The answer - - they too are all but unanimous. Only issue with consumers - Not enough programming content.
TVBR observation: All in all, this is good news for HD Radio as well. If people like what they hear, they will want to move from analog to digital. But the content has to be compelling. The biggest complaint that came up in the Consumer Reports survey was the lack of high-def programming for people to look at on their HDTV screens. Remember Content is King.
10/05/05 TVBR #195

VNU is in a Dizzy -
Will Billboard go on the block?
VNU, parent company of Nielsen Media Research, is facing a revolt by major institutional shareholders over its pending seven billion bucks deal to buy IMS Health. One possible outcome is that VNU may look at selling its trade publishing unit, including Billboard and The Hollywood Reporter.
TVBR observation: Will Perry Partners step up to bid for Billboard to combine with Radio & Records? Or has Rick Perry had enough of the trade publishing business? We also have to shake our heads at 7 billion as this is a heavy price to pay for a seat at the NYSE. The entire VNU company has a lot a risk going into 2006 and our recommendation to VNU bosses - Do not wear rose colored glasses because with out focus no company can have clear vision.
10/04/05 TVBR #194

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Keep Your PC Clean

With the ever growing importance of computers in our daily lives and our businesses, it is important to remember that software and hardware often need attention too.
Rules For The Road To 2006:

1. Windows Update
(run it every two weeks)
2. Microsoft is putting out "critical" updates every month. Turn Auto-Update On. When it asks you to install the new updates - say Yes!
3. Virus Protection (make sure your system is up to date) Norton, McAfee - all flavors of the same ice cream. We like ice cream right?
4. Application Updates - Office - Lotus Notes, all software typically has updates, make sure you update your software once per month.

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