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Apple Holding Back the Music Business?
Posted by
Zonk
on Tue Dec 13, 2005 04:23 PM
from the how-dare-you-use-technology dept.
from the how-dare-you-use-technology dept.
conq writes "With average weekly download as of Nov. 27 sales down 0.44% vs. the third quart, BusinessWeek speculates that Apple might in fact be holding back the music industry." From the article: "As has been true since the start, iPod owners mostly fill up their players from their own CD collections or swipe tunes from file-sharing sites. Now legal downloads may be losing their luster. According to Nielsen SoundScan, average weekly download sales as of Nov. 27 fell 0.44% vs. the third quarter. Says independent media analyst Richard Greenfield: 'We're not seeing the kind of dramatic growth we should given the surge in sales of iPods and other MP3 players.'"
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What am I supposed to do?!!! (Score:5, Funny)
Silly (Score:5, Insightful)
Seriously, it's right before Christmas, as the article points out. Nobody's going nuts buying music because they're spending all their money on presents and other holiday shit. Apple says they're selling a crapload of gift cards, and I believe them, given that everything iPod seems to fly off the shelves, virtual or otherwise. Regardless, since you no longer have to buy the physical media songs come on, there's no reason to buy them when you're doing your normal Christmas shopping, so sales very well *should* be down.
iPod sales are nuts, as usual, but that doesn't mean that music has to be selling, either. How many people you know, out of those who have bought iPods recently, are buying their first one? I'm sure a large portion of whatever iPods they're selling are peoples' second or third such devices. They're not going to be re-buying songs just because they got a new player, at least for now...
All this amounts to is another chance for the music services that lost (and it was pretty much over before they even got started) to bash Apple in a futile attempt to gain some traction. It's pointless, though. There's no buzz about Napster or Rhapsody, it's all iPod, iPod, iPod, for better or worse.
Re:Silly (Score:5, Insightful)
I think by demonstrating that it's possible to be a profitable "middle man" in the online music business, Apple has in fact saved the tushies of the music companies by offering an alternative to napster-like music trading systems. This exemplary system can be emulated by the music companies, if they so wish and assuming they have the intellect and vision, or they can go through Apple or Real or whoever else jumps in (Microsoft, probably).
The iPod would not have succeeded if Apple had tied it strictly to their iTunes database and disallowed any other formats. The secret of success for any great product is its power to do one thing really well and flexibly, emphasis on the latter. They had to let people rip CDs to their iPods, and of course that will lead to trading and avoiding paying for tunes, but it also allowed the iPod to revolutionize the "walkman" generation's listening habits.
Business Week is a pretty astute publication but this is clearly a case of short term-ism getting in the way of seeing what a revolutionary product the iPod really is--and now they're doing it again with videos. Should be interesting to see where they go with this. I think iPod may eventually absorb the cell phone and handheld organizer and we'll see excellent high capacity, wifi/cell-enabled personal bliss bars in everyone's shirt pocket in a few years.
Parent
Not that bad... (Score:5, Insightful)
Not to mention a lot of the MP3 player sales they're basing their estimates on could have been bought as Christmas presents.
I think they just WANTED a big growth in sales and things just don't always work out that way. They should compare things year to year, not quarter to quarter...
That's my $0.02
I think I know why (Score:5, Funny)
Parent
Re:I think I know why (Score:5, Funny)
Parent
Re:Not that bad... (Score:5, Insightful)
This smacks of another jab from the music industry trying to cry about how they are all going to go out of business because people can download songs for a dollar. The sad part is some congress critter out there that gets huge amounts of money under the table from the recording industry will use this to launch some legislation that will impose unrealistic and unenforcable laws on everyone.
Parent
You're kidding, right? (Score:5, Informative)
"The villain in the story is the iPod. You have this device consumers love, but they're being restricted from buying anything other than downloads from Apple. People are bored with that."
Who was this expert?
None other than Chris Gorog, CEO of Napster Inc.
Yeah, Chris, people are *real* bored. And by people, you mean you and your cronies, and by bored, you mean not making enough money for your tastes.
I would expect more out of BusinessWeek.
Re:You're kidding, right? (Score:5, Insightful)
They are protectionistic, rearview focused, and generally useless for even lining a bird cage. The sole redeeming feature is that they are pretty good at calling the top of a mainia (by focusing on why you should be there now).
It has always surprised me that the music companies blessed Apple's entry into music, when the most basic sales calculations were demonstrating that the iPod was the thing that legitimized the public use of shared music for a large subset of mainstream consumers.
Parent
Re:You're kidding, right? (Score:5, Insightful)
No he doesn't.
He's implying that without Apple, the music industry would have some great online business going and be selling tons more music. That's clearly bullshit. If it were true, they would have their thing going dispite Apple, and people would be using it.
The music industry is pissed because Apple came up with a device that everybody wants, and instead of using it to make zillions of dollars for the music industry, they're using it to make zillions of dollars for themselves.
Boo hoo.
Apple doesn't owe the music industry *anything*. If the iTunes music store didn't exist, people would *still* buy iPods like crazy, because it's the only player out there that is user friendly, stylish, and completely impartail to whether you choose to listen to licensed or DRM-free content. It seems to me that iTunes is just a big shield from lawsuits, because as long as it exists there are considerable and obvious non-infringing uses for Apple's device. iTMS is Apple covering their ass. If this Napster guy wants more control, then he should come up with a device that people like better than an iPod and tie it to his service instead. He won't though, because he can't build a device that allows people to play pirated music, and consumers are fed up with paying high prices for music.
Apple isn't holding the music industry back, consumers are. They've reached the limit of how much money they're willing to fork over. They're going to have to be sitisfied with their revenue pit just being bottomless, and learn to live with the fact that they can't keep making it wider too.
Parent
Re:You're kidding, right? (Score:5, Insightful)
How does that make me wrong? Can't he imply more than one thing in an article?
I fail to see how anything Apple does makes it OK for anybody else to bitch that they're not making money off of it. If you want a piece of the action, it's not Apple's job to open the door for you. In fact it's their job to keep it shut and protect their profits. It's rediculous for anybody in the music industry, or any other business, to expect Apple to do them any favors.
Who cares if other businesses aren't permitted to offer alternative services?
If you want to make money in the digital music market, you need to do it yourself. Why should Apple help you to make money off their product?
If this guy is so smart, he should make a better store and a better player. If he's right, it should be possible, and people should flock to it and leave the iPod behind. Anything he can come up with that nets the recording distribution industry more profits is pretty much guarantreeed to be seen as *worse* by consumers though, so he'll never pull it off. He doesn't want to offer you choice, he wants Apple to stop being so damned nice (in his opinion; obviouly not in your opinion) to consumers because it's preventing them from getting away with charging more (where more is most likely a pay-per-listen or some other recurring revenue model).
We love Apple, the iPod, and iTunes. Who cares...
I don't understand why you assume that any opinion of Apple or their products has anything to do with my point. I'm talking business here, I'm not being some fanboy. I don't have to like or dislike Apple's practices for me to see why it makes sense for them to do that stuff interms of their bottom line. The goal is to make money, not to win a popularity contest.
Parent
Re:You're kidding, right? (Score:5, Insightful)
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Be my guest (Score:5, Insightful)
If music industry is considering non-propietory technology and prices below 99 cents/song, there is nothing Apple can do to prevent that. All they have to do is put their stuff on mp3tunes.com
Faulty reasoning from the start (Score:4, Interesting)
What exactly is this generalization based on? It basically implies that all individuals owning an ipod/mp3 player are copyright infringers from the get go. Then, just because sales are down for a quarter, it's the sign of the Apocalypse! Are they not teaching logic in schools anymore?
Too Expensive (Score:5, Insightful)
They're GIFTS! (Score:5, Insightful)
Sell us better music! (Score:4, Insightful)
Hmmm... sales suck on CD, sales suck online... maybe it's time for the record industry to reconsider its current business model of pushing albums where the musicians lose almost all control to producers who churn out an album with three good songs and ten filler tracks.
Not Apple's Fault! (Score:5, Insightful)
Jobs wants to lower the cost of songs, but the RIAA has insisted that they raise the cost of new songs in order to lower the cost of other ones. Many people are not willing to pay $.99/song muchless $1.xx for one. And the complaint from Napster in that article is pathetic... they are just upset that Apple dominates the marketplace. You want more sales... then lower the price!
http://religiousfreaks.com/ [religiousfreaks.com]Who cares about 0.44 percent? (Score:4, Insightful)
I.E. So of an average of 1,000,000 downloads, that means last month there were only 995600?
Seems like someone is reading alot into it.
Lies! (Score:5, Insightful)
Re:Lies! (Score:5, Insightful)
So you bought music knowing it had DRM, and knowing iPod doesn't play it, and now you're complaining. Sounds like you fucked up.
Parent
The obvious solution... (Score:4, Funny)
I love statistics out of context. (Score:5, Insightful)
For example, over the course of the product, I've owned 4 different iPods. Apparently this means that my online music buying should have quadrupled, which it did not.
Thus, the link between iPod sales and buying music online is not directly proportional.
In other news... (Score:5, Funny)
"All people do with their CDs and iPods is listen to them. People think that they don't have to pay anything else beyond the initial purchase price. But what they don't understand is that they need to pay royalties every time they listen to them," said RIAA spokesman, Bob Degalhart. "Every song you play on your stereo or iPod should require some form of small micropayment to us for the right to even play that music. Everyone should realize that purchasing the music is only the first of many steps."
The RIAA and the industry plans to push legislation to require all stereo equipment, MP3 players, and hearing aids be fitted with special software that is capable of completing micropayment transaction per listen. Industry member Sony says that it has special software available for installation on home PCs for this purpose and plans to deploy it in the near future.
It seems to me.... (Score:5, Insightful)
Burning it to CDA and re-ripping it doesn't count. It's annoying and drops all the metadata, in addition to the transcoding quality loss. If they want to sell me music, it MUST be in a non-DRM format that I can use on ALL of my devices, MP3 for example. If they refuse, I'll take my money/time elsewhere. Indy, filesharing, certain russian sites, etc.. And I'm sure I'm not the only one. I'd be happy to pay $1/song, for high-quality (LAME-Standard minimum) MP3 or FLAC audio files. Hell, let me pick the format and bitrate and charge me a little more for the bandwidth for the higher filesizes. Oh, wait, someone else allready does that.....
Correlation is not causation. (Score:5, Funny)
Can you spot the logical flaw?
Last week I predicted the following:
a) I would immediately win a hundred bojillion dollars in the lottery.
b) The most beautiful women in the world would gather around me to sing my praises.
None of that has happened so far, and seeing as how b is dependent upon a (lets not kid ourselves, I'd have to buy plane tickets for all of them to fly here), we should focus on a. A requires me doing things like buying lottery tickets, and the lottery having that kind of money, neither of which is the case. Therefore there is only one inescapable explanation: It's all the lottery people's fault. They're 'holding me back'. They should have set the pot that high, given me a free ticket, and then changed the rules so that only I would win.
I love this game!
0.44%!? (Score:4, Insightful)
Totally ignore the fact that Christmas is comming up and people stop spending money on what they want and start saving for others, very often presents arn't music so the money goes else where.
Sorry RIAA... (Score:5, Insightful)
Sorry, RIAA... you had your chance.
and (Score:5, Insightful)
Not in my household (Score:5, Interesting)
Our reasons for buying less music is:
1. Dislike of Sony and the RIAA -- where we used to buy 3-4 CDs a week at Borders, we're lucky to buy even 1 a month because of their strongarm tactics. Until Borders starts carrying the popular indie bands in their area, we won't buy CDs. Some indie bands in our area have sold 2000+ CDs privately without record store support. If they expect to be part of my community, they better do more research.
2. Bigger support of the ma-and-pa brick and mortars. As our retail stores that we own lose business to the dotcoms and the super stores, we've found that by supporting other locally owned shops, we see more locally employed customers at our stores. It is the ultimate "outsourcing" to see your community spending money outside of the community to save on sales tax and maybe a 5% difference in price beyond that. 14% is still a huge savings, all from government coercion.
3. Income. Our income this year is about double the last 3, but our income in the last 6 months is down over 70%. I've been putting more of my income into real savings (gold, silver, property) to weather to storm ahead. I've also expanded my market from just-the-Midwest to the entire world, and I expect it will take a year or two to get back to my first half of 2005 income levels.
4. Quality. The quality of the mass produced records is terrible. I can't listen to the top 40 record stations at all -- every vocalist is enhanced, delay and reverb is worse than the 80s, and the compression destroys any fidelity that might have made it through the overproduction period. Garbage in, garbage out, garbage unbought.
5. Promotion. I don't feel any desire to pay $50 to see a concert of 3 bands I barely know. The indie scene is usually $6 to $12, I see 2 amazing bands and 3 new bands cutting their teeth. $2 beer, $4 calls instead of the big shows where we paid $14 for a drink recently ($110 per ticket). Without cheap promotion the records won't sell.
6. Collusion. Try to get tickets today to any popular show. The rules governing ticket scalping are created specifically to take care of the few scalpers who are licensed by the local government. It has made shows nearly impossible to attend to. One popular show we were willing to pay $60 per ticket for was sold almost entirely to 3 ticket scalpers.
7. No desire. There are so many new ways to be entertained (due to the web) that music-on-CD just won't cut it anymore. I've been talking to a local show producer who is finding better ways to stream live shows to the web in a high quality, high fidelity, well produced show. I can't wait for his work to come to fruition.
Maybe I'm old school (Score:5, Insightful)
It's mp3 this year but who knows what audio format is coming around next year? Are you going to be able to play your iTunes downloads 10 years from now?
I'm glad Apple is doing well with iTunes, but it's just not for me. I want a disk. I want a disk I can rip to the PC and portable device of my choosing whether it's on Windows, OSX or Linux. And I especially want to be able to find something that can still play that CD 10 years from now.
Margin of Error? (Score:4, Insightful)
Dear Chris (Score:5, Insightful)
Chris,
I know this is hard to wrap your head around. The iPod is a media player with a built in hard drive. There is no vendor lock in. I've been able to downlaod music from napster, kazaa, soundclick, and a variety of vendors. Amazingly, they all work fine. AIFF, WAV, MP3, ACC, all work fine on my iPod. Should your's behave differently, RTFM.
What the iPod doesn't do, is support every god damned DRM scheme on the planet that lets you and your corporate cronies "lease" your DRM infected music to iPod owners. Quite frankly I'm not interested in DRM laden crap from napster, real, or anyone else including iTMS. I bought my iPod to carry around the large collection of music I already have, not to populate it with new music that has been approved by some industry suit.
So, in conclusion, the iPod is a hard drive. I can get files of any type onto it with ease. The iPod is a media player. I can play a fair variety of widely available media types without problems. The problem is in the DRM schemes that lock content to specific devices.
The iPod did not lock me into anything, your DRM infected business plan locked me out of your customer base. I am not interested, and it has nothing to do with my iPod.
I have not, nor will I ever "lease" digital music for my device. If I am paying with real cash, I want real bits I can twiddle as I see fit.
Sorry Charlie! (Score:5, Interesting)
I'm not sure why they are surprised with this? Did they honestly think people would only put newly-purchased music on their iPods (apparently so)? Why wouldn't I want to put all the music I already listen to on it? When the iPods first came out, it seemed like the biggest buyers were people with too much money on their hands that bought every CD that ever appealed to them, and were tired of shopping for n-disc changers for their cars and jukebox systems for their homes. The whole POINT is that they can hold albums and albums and albums of music without carrying around all the accompanying cruft (CD organizers, anyone?). iTMS was just icing on the cake, a way to explore new music and purchase a track or two without buying the whole album. If I had to make a guess, I'd say iTMS completely revitalized the 'singles' market.
We're not seeing the kind of dramatic growth we should given the surge in sales of iPods and other MP3 players
"the
PAH. I give up. Someone needs to get the music industry to grow up and stop whining that someone played with their toy: it's time for them to eat their vegetables and wear regular underwear instead of diapers. This should be accompanied by a talk about how life doesn't play by the rules you make up for yourself. Sheesh.
god, mom, you are such a LAME-O! (Score:5, Funny)
"This even roots my computar, suckwit."
Parent
Re:Absolutely Correct (Score:5, Insightful)
When CD's came out, the vast majority of music lovers replaced the albums they already owned with new CD's.
I seriously think that there are music execs out there who were hoping that a new format (downloaded music) would mean that we would all want to buy our entire music collections all over again, in spite of the fact that the power is in our own hands to convert files this time.
Consequently, the back-catalog sales are absolute shit compared to what the early days of CD's were like. Lots of people are using iTMS to buy songs from Fountains of Wayne, Death Cab for Cutie, and/or the latest pop princesses, but nobody's re-buying the old Pink Floyd albums they already own in another format, and that's what's driving them nuts.
Why, we even have the audacity to BACK UP our media files, so we no longer need to buy a new copy every few years because of loss, damage, or wear. It's KILLING their sales numbers.
Parent
Entitlements (Score:5, Insightful)
Ultimately, they think they are intitled to make a profit every time someone listens to a song under their umbrella, or iron fist.
So if I own a lot of LP records, and want to listen to them in the car (car turntables are not very stable unless you drive really carefully) they cry "No Fair!" and get a tax put on casset tapes.
If this were really about piracy, that would be the only thing they would mention. The fact that they are complaining about people filling up their iPods with music that they already have a legal right to tells us what is really on their mind. They feel entitled for people to buy music all over again. And in another 10-20 years they will propose yet another format and expect it over again. Like a corrupt utility company, or a corrupt government, record companies want the right to tax us and then keep that money for themselves.
With any luck Artists will control their own music, and profit from it by then and the record companies will be dead.
Parent
Seriously. (Score:5, Insightful)
Parent
Exactly (Score:5, Interesting)
The problem for them is that there's nothing compelling about new music formats other than MP3/AAC. DVD Audio may be wonderful, but to the average person who just wants to listen to some music in the car, or while working out, it doesn't matter. The high end audiophile types might get into it, but there's not enough of them to create the necessary economies of scale.
I would argue that Apple/ITunes is boosting new music sales because it makes it so incredibly easy. If I find a new artist, I can e-mail you a link, you click it, and 30 seconds later, you're downloading the new music. No trips to the store. No forgetting about that cool new album your friend recommended. Plus the IMixes give another way to find music you might not have bought before.
So it is good for the music industry in the long run, but they have to learn to accept the fact that the crack pipe of back catalogue music sales is running out of smoke. It's going to be hard times for them for a while because even with growing new album sales, they're likely to see an ongoing decline in revenue.
Parent
Re:Exactly (Score:5, Interesting)
I think the last time I bought into the audiophile craze was for stuff like "Dark Side of the Moon" or "Twin Sons of Different Mothers" as published by the likes of Mobile Fidelity, CBS and Nautilus (half speed mastered), and Japanese high quality virgin vinyl stuff. But in the end it's hard to imagine the difference in quality was actually worth it. The sound quality bottleneck always remains the fact that your stereo system and room acoustics must also be fantastic or you can forget about it - and I don't happen to live at Carnegie Hall and a lot of the stereo component stuff (aka hi-fi mumbo jumbo) I simply never believed.
So here I am today, I own thousands of vinyl LPs and I own at least another 1000 CDs. All of my CDs have been ripped to a 160 GB hard drive and my music server is still growing by leap and bounds as I add in old vinyl favorites. For vinyl I record from a slightly clunky line-in situation ripping to wav, splitting the tracks, running a pre-tested set of filters that reduce noise, hiss, and pops and clicks, and then finally I use EAC and LAME to make VBR MP3s. Before laughing at my set-up consider that I really do have some vinyl albums and 12" tracks that never saw republication as a CD. For CDs I rip with a Plextor drive, EAC, and LAME to VBR MP3s.
For album songs that segue I additionally rip them as a single track and name them appropriately - so you get a choice, play the album as it actually sounds without interruptions or mix your own playlists with possible segue created gaps. That's pretty much the one drawback to the technology. So far that's 28,669 VBR MP3 files.
I can network the server around the house to locations that I call "dumb but quiet network boxes" with decent sound cards and 7.1 computer speaker systems. The sound is quite sweet. Winamp, Foobar 2000 and Milkdrop rule the day. And there's a use for your old computer and monitor collection if you tweak them up with sound dampening computer cases. Some 5 GB hard drive systems I have down to one Antec power supply fan which can barely be heard, the second exhaust fan kicks on as necessary. You don't need many fans for boxes that do nothing but operate as interfaces for a music server.
And speaking of that music server...
It only makes sense to backup that kind of effort offsite, right? So I gave my brother a backup on a hard drive for the enjoyment of his family. I would have no objection to giving a backup to anyone I know, quite frankly. And I can't be alone in this. I am not handing out free 200-300 GB hard drives, but if someone gives me an empty drive I am cool about it.
Copyright realistically is dead. Even if respected, copyrights have no market justification to last longer than about 4 years, if that.
It's seriously game over for the back catalogue - now and forever. Every future DRM will be cracked. Why? Because people want access to their "licensed" digital stuff. If they think I won't make my own backups and then possibly even share those with friends and family (as I have done for decades now by every other known method going back to reel to reel days) then they are mistaken. If my original copy of my CDs are lost or stolen or even sold, I have no intention of erasing backup copies from my MP3 server.
The music industry has had its day. Now it is near sunset.
Songs are and have always been just commercials for live performers - and they should always have had a nominal price and no protection schemes. That's what the market demands.
Parent
Re:Absolutely Correct (Score:5, Insightful)
The music industry insists that we all should buy our music collections all over again. It's legal to copy the CDs for your own use - just as it's legal to copy DVDs for your own use.
That's why the laws to make it illegal to break encryption - it was a way around consumer rights. You can rip DVDs for your own use, but you can't break encryption, and the movies are encrypted.
This nonsense of attempting to DRM CDs is just the music industry trying to play catch-up. Trust me, I've ripped my 200+ CD collection, and the music industry would have me pay for every single song a second time.
Parent
Re:Absolutely Correct (Score:5, Insightful)
Also, they need to come up with a solution to the "segue" problem. Many albums are mixed such that one track segues smoothly into the next. You get this when you buy the CD. When you buy digital downloads you get hiccups (gaps) between the tracks. Kludges like a crossfade in the MP3 player are not acceptable. I want the exact segue as mixed on the original CD!
There are two pieces to fixing this: the files themselves need tags indicating that a segue exists into the next track from the album and, for compressed audio formats, there needs to be a tag indicating any "gap" (coding delay or frame padding) at the beginning and end of the file such that the MP3 player can strip this off during playback. (The LAME encoder does this and so you get gapless playback on an enabled player eg Foobar2000.) The other item the tags should contain is a recommended fadein and fadeout to use when a track is not played among the other tracks of that album. That way you dont get abrupt cutoffs when playing songs in shuffle.
Did I mention I still buy music on CD? Lots of it too!
Parent
Re:Absolutely Correct (Score:5, Insightful)
Because those greedy bastards want a nickel EVERY TIME YOU HEAR THE SONG
Parent
Who wanted Apple to use DRM? (Score:5, Insightful)
This is exactly the lock-in future that DRM brings to the world. The music labels are crying bitter tears because they don't control the locks. Whaa whaa whaa. What would be different if Sony had succeeded instead of Apple? Do we think we'd be seeing Sony offering whatever they had to everyone? No. DRM simply sucks. It's anti-consumer, anti-competitive and restricts the growth of the marketplace. Reap what you've sown, you greedy bastards.
Parent
Re:Who wanted Apple to use DRM? (Score:5, Interesting)
In effect, Apple's monopoly is working against the music labels' monopoly. If you take Apple's DRM monopoly away, consumers get screwed.
Parent
Re:Who wanted Apple to use DRM? (Score:5, Interesting)
I filled my MP3 player with music from CDs I already owned. Haven't bough a single song online, haven't bought a new CD in 6 months.
Quite simply, I have enough music to never get sick of what I own. And since it's all easily at hand, I'm even less likely to get bored with it. I have downloaded some music that is being distributed free of charge by the copyright owners, but that's it.
Now that its so easy for people to access their own library, the music industry needs to do more to get me to spend any money.
Parent
What could they possibly do? (Score:5, Insightful)
To get my 70+ year old father to buy more music, you'd have to bring Bob Wills back from the dead to record another album.
I don't think you or my father are the kind of customer the RIAA is trying to attract.
Parent
Re:My theory... (Score:5, Insightful)
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Incorrect (Score:5, Informative)
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Nothing old either (Score:5, Insightful)
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