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Stop The JerkTech

Mark Zuckerberg to Speak on Immigration Issues at S.F. Film Premiere

Facebook CEO Mark Zuckerberg at the Facebook Home launch event.

Facebook CEO Mark Zuckerberg plans to deliver an address on immigration issues in early August, according to the San Francisco Chronicle, the first time he has spoken publicly on the matter.

The speech will include the San Francisco premiere of a new film, “Documented,” which chronicles the struggles of undocumented immigrants entering the United States.

The film was written and directed by Jose Antonio Vargas, a writer and immigration rights activist who revealed his own status as an undocumented immigrant in a widely circulated New York Times Magazine article in 2011. (Vargas also wrote a lengthy profile of Zuckerberg for the New Yorker a few years ago.)

The premiere is sponsored by and ties in perfectly with FWD.us, the sometimes controversial Zuckerberg-backed political action group focused on U.S. immigration reform. The issues that FWD.us supports are felt by many tech companies in Silicon Valley; in particular, the focus on changing certain legislation which would allow for more annual H-1B visas, ultimately granting more foreign workers entry into the U.S.

But, as the Chronicle notes, the premiere will be the first time Silicon Valley will enter the wider debate on immigration reform as a whole, rather than just focus on the expansion of visa programs in order to recruit international engineering talent.

The film debuts at San Francisco’s Yerba Buena Center for the Arts on Aug. 5.

Pinterest Now Tracks Everybody by Default, but You Can Opt Out

Pinterest will now compile profiles of people who visit sites that contain Pinterest buttons, so their social bookmarking experience can be automatically personalized around interests that correspond to those sites.

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This will happen both for people who are currently logged in to the Pinterest website, and for people who have never even joined Pinterest, via anonymized tracking.

“So, if you’re planning a party and have gone to lots of party sites recently, we’ll try to suggest boards to make your event a hit,” Pinterest software engineer Ke Chen explained in a blog post.

“Pin It” buttons and other Pinterest widgets are used on just about every page of major sites, including Amazon, eBay, Nordstrom, REI and Bon Appetit.

Their original purpose was so that that shoppers and other users could easily save items they come across to their Pinterest boards. Since Pinterest sends lots of traffic back to the sites, the buttons are all over the place.

People who want to opt out of Pinterest tracking can enable “Do Not Track” on their browser, change their account settings, or tell Pinterest not to use that data when they sign up.

Pinterest announced the initiative today by emphasizing its support for Do Not Track, a privacy initiative that has had trouble getting off the ground because people can’t agree how to implement it, and tracking users is a key ingredient for personalizing services and targeting advertising. As an emerging Internet giant, Pinterest’s endorsement for the standard is important.

However, the more notable aspect of today’s news doesn’t seem to be Do Not Track – it’s that Pinterest is tracking people who don’t even use the service.

That’s because Pinterest wants to provide a good experience for new users the first time they visit, said company spokesperson Malorie Lucich.

“One of our hopes is that, when people join Pinterest, we’ll be able to suggest better content to them, so they have a good new-user experience (and see stuff that interests them),” she said. “As part of the sign-up process, they can tell us not to use that type of data. (There is a clear check-box.)”

Data collected about users who are logged out of Pinterest will be anonymized, she said.

Lucich explained, “We think the websites you visit are a good indicator of your interests (and Pinterest is all about your interests). So as people visit sites with the Pin It button (or other Pinterest widgets), we can use that information (if they’re interested) to recommend better boards to follow.”

She compared the Pinterest feature to one that Twitter launched in 2012, which suggests accounts for new users to follow.

The Twitter suggestions are said to be based on monitoring people who visit sites with Twitter widgets on them, to see what accounts they commonly follow. If the new user has also visited one of those sites in the past 10 days, some of those accounts will be suggested.

Both moves are a little creepy when you think about it – some site that you’ve never even joined is ready and waiting to personalize itself for you, whenever you show up.

That said, this is not uncommon. Tracking cookies are used all over the Web, and few people know or care about them.

Pinterest said it would be adding the features “in the next few weeks.”

A Year In The Making, Machine Zone Launches Game of War, An Impressively Large MMO For iOS

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While iOS games started out as either simple physics or casual simulation titles when the platform launched about five years ago, the bar has gotten steadily higher and more hard-core. Midcore studios like Kabam started to rise in prominence.

Now the iOS platform might be seeing is most hardcore title to date – a very, very massive multi-player title from YC- and Menlo Ventures-backed Machine Zone.

The company, which started out doing text-based RPGs a couple years ago like iMob, is launching Game of War: Fire Age. It’s a title where players build and grow empires, train massive armies, forge alliances with other players to win kingdoms.

The game can handle hundreds of thousands of players concurrently in the same universe, which is not an easy technical feat. Blizzard’s World of Warcraft, in contrast, typically handles a few thousand players simultaneously in a single realm. All movement on the game’s map is visible to everyone else.

“We wanted to take the company to the next level and be really ambitious,” said Machine Zone CEO Gabriel Leydon. “We decided to build some things that had never been done before. We had the capital to do it and the willpower.”

Leydon didn’t hire just typical game designers to build the title. He also found people who had experience in scaling massive systems. The game’s user interface is in HTML5 and is rendered natively, allowing the company to handle different screen sizes.

The other really cool thing about the game’s social capabilities is that there is a mechanical turk-like translation system where the players themselves translate chat in exchange for virtual currency rewards. That helps Game of War have really interactive play with a proper critical mass of users who can talk to each other, even if they don’t speak the same language. The in-game chat system helps Game of War get manage slang and gamer speak, which a third-party translation system probably wouldn’t handle correctly. If say, 50 players translate the same words in the same way, then the game will start using that translation automatically.

“It’s like a highly structured Facebook,” Leydon said. “My goal as a game designer was to create a feeling of what it would be to be a king, where you’d have a lot of people under you. You’d have to subjects, wealth and land.”

Assuming say, the game grows to 1 million players, there might only be 20 kings in the game. To reach that level, players have to woo others to form alliances with them. Within those alliances, there are ranks for different officers.

“This is a very hardcore game. This is not Candy Crush,” he said. “This is a complex system with a lot of potential trees of outcomes. If you’re the type of person that’s fascinated by systems like this, then this is for you.”

Machine Zone used to be known as Addmired, and rebranded last year when it took $8 million in funding from Menlo Ventures. Leydon said this is what the company took the round for, even though its older titles like Original Gangstaz and iMob 2 were pretty lucrative early on.


Healthcare Crowdfunding Platform Watsi Grabs $1.2M From Tencent, Paul Graham, Vinod Khosla, Ron Conway And More

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At TechCrunch Disrupt NYC back in April, former Facebook exec-turned-venture capitalist, Chamath Palihapitiya delivered a deflating critique of the tech industry – in particular, the quality of its startups. Had he been issuing a report card, the Tech World would have gotten an “F,” with an extra side of “shame.” His frustration seemed to emanate principally from the fact that “Big Ideas” are few and far between in the industry today. Rather than aiming high, he intoned, entrepreneurs seem content to reach for low-hanging fruit despite the diminishing returns inherent to that approach.

While Big Ideas may not be at all-time high, today’s news brings some assurance that they are still alive and well in the tech industry – and that there’s even capital to support them, for-profit or not. Watsi, a Y Combinator-backed healthcare crowdfunding platform, is tackling one of the biggest: That more than one billion people can’t afford (or don’t have access to) adequate medical services. Even Chamath would likely agree that falls in the “Big Idea” camp.

Today, the non-profit crowdfunding platform announced that it has raised $1.2 million in what is its first round of financing, or “philanthropic seed round,” as the startup is calling it. Granted, if Watsi is setting its sights high, than $1.2 million will only be a drop in the bucket compared to the capital and resources it will need if it truly hopes to make a difference at scale.

A good start, to be sure, especially when considering the impressive roster of names contributing to its first financing, which includes institutional investors, like China’s largest Internet services portal, Tencent, Y Combinator partners – including personal investments from founder Paul Graham and YC Partner Geoff Ralston – along with the “godfather of angel investing” and owner of the most pristine coiffure in the Valley, Ron Conway, Sun Microsystems and Khosla Ventures co-founder, Vinod Khosla, venture philanthropy fund (and Kiva investor), The Draper Richards Kaplan Foundation and Flixter founder and Rotten Tomatoes CEO, Joe Greenstein – to name a few.

While the list is impressive, it’s not a group of investors one would typically find contributing to a non-profit fundraiser. Watsi founder Chase Adam explains that the reason the company opted for this approach is that the traditional mechanisms for non-profit fundraising sometimes act as a counterproductive force by undermining the social movements they’re trying to support. Instead of devoting themselves to their “Big Idea,” socially-minded entrepreneurs often spend their time entering online voting competitions and hosting banquets to raise money to support their operations.

Instead, Adams hopes that the collection of VC, angel and institutional donations represents a move toward a new future of non-profit fundraising. Granted, Watsi is in the unusual (and fortunate) position to have been the first non-profit startup to be accepted into Y Combinator and to have had the vocal support of Y Combinator’s founder, Paul Graham, who also recently accepted a seat on the startup’s board – the first time he’s done so for a YC incubation.

In reference to this question, Graham suggested to Watsi that they call this raise a “Series N” (non-profit and n=variable).

On the flip side, Adams tells us that he set a three-month deadline for fundraising, deciding to go after industry leaders and big names in the angel and venture world, regardless of whether or not the efforts proved to be successful. By doing so, the Watsi founder hopes that this might help encourage other social businesses to consider forgoing traditional sources of fundraising.

Ben Rattray, the founder and CEO of social action platform Change.org and I recently spoke on this very subject after the socially-minded for-profit company closed its own $15 million round of funding. As a for-profit business, there’s more pressure for Change.org to raise institutional or venture capital.

As a non-profit, Watsi would likely be more attractive to investors, whereas Big Idea-based, for-profit companies have traditionally found it difficult to raise money from these types of investors. However, both Adams and Rattray share similar goals, as the Change.org founder that would enable them to remain independent without having to constantly be looking for a one-time liquidity event.

“These kind of social enterprise businesses are working over the long-term, 15 to 20 year windows, which is beyond the scope of most venture capitalists,” Rattray said at the time. However, he believes that it’s going to change: “I have no doubt this is going to change – that eventually more investors are going to start backing socially-conscious businesses,” Rattray says. And it’s for that very reason that I think the juxtaposition of Watsi and Change.org is worthwhile. Although perhaps idealistic – and, admittedly, Watsi is a non-profit, perhaps the startup’s funding is the first sign that it is, in fact, beginning to change.

Nonetheless, for Watsi, this raise is an important validation of its own ambitious, “Big Idea” goals. Of course, eliminating poverty or fixing global healthcare and covering the uncovered, don’t happen over night and aren’t solved by one person or one founder. That’s why Watsi is leveraging the “many hands” approach of crowdfunding to let anyone contribute to the funding of low-cost, high-impact medical treatments for those in need.

Furthermore, the platform automatically creates profiles for those in search of financial support for treatments or surgeries and makes it easy to make direct donations. Furthermore, these profiles, besides providing critical transparency into how your donation will be used and actually help someone, it also works towards attaching actual, human faces to global poverty – which sounds cheesy but is critical to conditions or problems like this that are so huge that providing real faces, one-by-one, can help discourage, say, just ignoring it and hanging for a lower-hanging fruit.

To further incentivize donations, Watsi offers 100 percent of the donations it collects from the crowd to those in need. Graham also says that the startup is paying “all their operational costs from their own funding, and none from your donations,” and in turn, even stomach credit card processing fees. A noble gesture in its own right.

The startup hosts the profiles of people in need but who can’t afford them, allowing donors to peruse profiles, donate as little as $5
, Watsi hosts profiles of people in dire need of medical care, but who can’t afford it. Donors can browse the profiles and donate as little as $5 to help someone get well. 100% of donations go to the sick, and Watsi funds its operations and even pays credit card processing fees on donations out of its own pocket. We name

Neustar Buys Aggregate Knowledge, One of Facebook’s Ad Tech Favorites, for $119 Million Cash

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iStockphoto | dny59

Neustar, which makes most of its money managing databases for phone companies, is buying Aggregate Knowledge, an analytics company best known recently for its work with Facebook.

Neustar, which reported earnings today, paid $119 million in cash for Aggregate Knowledge; Neustar officials said they would also use restricted stock units in the transaction.

Aggregate Knowledge had raised a reported $64 million since 2005, from investors including Kleiner Perkins, DAG Ventures and OVP Venture Partners. The company restructured in 2010, when current CEO David Jakubowski came on board.

Neustar’s main business involves managing databases of phone numbers for carriers, and that work generated more than half of its $830 million in revenue last year. But it has been trying to build up a marketing business as well; marketing is part of its “information services” unit, which makes up roughly a quarter of its revenue today.

Aggregate Knowledge is supposed to help accelerate that push, and Jakubowski will head up Neustar’s marketing businesses.

Prior to today’s deal Aggregate Knowledge has been spending a lot of time with Facebook, helping the company explain how its ad campaigns are working for marketers. That relationship will continue after the acquisition, Jakubowski said.

The NYT’s Nick Bilton Talks About His Book on IPO-Ready Twitter (Video)

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I always like to indulge in a little logrolling in our own time, but this video interview I did with New York Times columnist Nick Bilton about his new book is pretty fun.

“Hatching Twitter: A True Story of Money, Power, Friendship, and Betrayal” officially comes out on Tuesday. But it is already being reviewed and munched over by many for its controversial stories about the founding of the San Francisco-based social microblogging phenom.

Including: Former CEO and co-founder Jack Dorsey fired! Former CEO and co-founder Evan Williams hired! Dorsey returns! Williams fired! Current CEO Dick Costolo hired! Costolo almost fired!

Essentially, it is like a Spanish telenovela over there at Twitter, except it’s all dudes falling in and out of bromances.

Bilton noted to me that it reads like a mystery novel, akin to the game of Clue. As in: Board member and VC Peter Fenton in the server room with a virtual hammer!

Since Twitter is going public this week – ya might have heard – Bilton’s timing could not be better.

Here’s my interview with Bilton, who showed up at my house in the Castro on Halloween night. (It is an annual costume apocalypse in my neighborhood, so this guy really wants to sell that book!)

Here’s the interview:

Zuckerberg Calls Snapchat A “Privacy Phenomenon”

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Mark Zuckerberg thinks Facebook’s innovated by creating a place where people could share what wasn’t shared before, which is also why he thinks Snapchat is important. Today in a low-profile talk at Stanford alongside discussions of the NSA and venture capital’s shortcomings, Zuckerberg said “Snapchat is a super interesting privacy phenomenon.”

Zuckerberg sat down today with Stanford’s President John Hennessy onstage at the school’s Memorial Auditorium for a wide-ranging hour-long chat in front of Stanford students, professors, trustees, and Facebook employees. Here’s a video clip of a more light-hearted anecdote from Zuckerberg about Facebook’s early days that Stanford published.

The NSA And VC

The CEO spoke at length about Facebook’s three new goals after reaching 1 billion users: Connecting the rest of the world to the Internet, understanding the world through an artificial intelligence-powered unified model, and fostering the knowledge economy so more of the world can thrive.

Zuckerberg pointed out how Silicon Valley venture capitalists aren’t necessarily equipped to fund solutions to these problems (emphasis mine):

“You know there’s a great venture capital system here for investing in problems that require maybe like one to ten million dollars to kind of get started solving. But there aren’t really a whole lot of places in the world where you can solve problems that require, say, a billion dollars or three billion dollars of investment up front before you can really make a huge amount of progress on them.

And I think some of these problems are really worth solving like Internet for everyone in the world, or trying to build this unified model and build some kind of early AI, or trying to solve some of these issues around the knowledge economy…and there are only a handful of companies and a handful of governments in the world that are really in a position to make those kind of investments so I want to make sure that we put a lot of our efforts towards doing big things like that.

This means we should expect to see Facebook continuing to pursue programs like Internet.org and its new artificial intelligence initiative. Zuckerberg explained, along the way to solving huge problems, there are often rapid advances in technology – much in the way Bell Labs invented the transistor while trying to make phone signals travel across the country. So while these goals might have no “end” in sight, they may produce intermediary benefits to Facebook’s product and armory of intellectual property.

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As for the impact of NSA relations on the average Facebook user’s willingness to share, Zuckerberg noted “I haven’t seen it in anything that we measure.” However, he said that the United States has been a champion of freedom of speech as the right policy, but that our insistence on surveillance could make the world lose faith in that ideal. Zuckerberg stated:

“The biggest concern that I have is that the NSA revelations knock that down a peg and I think the U.S. loses the moral high ground a bit, which makes it so that other countries which may have different views on how this should work now are more kind of empowered to do things in a way that might kind of balkanize or splinter things a bit more, which I think would be quite unfortunate if the Internet ended up working very differently or there were different rules for connection.”

Snapchat As A New Place To Share

The most fascinating part of the talk was where Zuckerberg said Facebook thinks about privacy much differently than most people expect, hinting that the world believes the company is pretty much against it. After all, the latest Grand Theft Auto video game did parody Facebook by naming its in-world social network “LifeInvader.”

Zuckerberg explained that before Facebook, there was instant messenger for communicating with one other person or a small group, and there were blogs for sharing publicly, but there was nothing in between. Zuckerberg said (emphasis mine):

“There was no privacy infrastructure to communicate with your community or just a set of friends all at once, and because of the lack of that, basically if people wanted to communicate something they had to choose to communicate with a very small audience or communicate it publicly. A lot of times you’re not comfortable communicating it publicly and maybe it’s just not worth communicating it to a small set or that’s not the full potential of what you want to communicate so you just don’t do it, it just gets lost. And that potential idea that could have been shared, or thought, or human connection and kind of option to have more connection and do more on that over time is lost.

So I actually think kind of the fundamental innovation that Facebook brought was creating this space. Right, which is really, it’s a private space that didn’t exist before. That there was no tool to be able to communicate in that space, and by opening that up and enabling people to kind of fill that space we unlocked a huge amount of potential in terms of people being able to communicate ideas and learn about what’s going on around them.”

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Unfortunately, that statement is at odds with a lot of how Facebook actually handles privacy. As far back as 2009 and 2010, Facebook began recommending that existing users share their status updates, photos, and other content publicly. It also began defaulting users to share these types of posts with everyone – something I criticized at the time for putting users at risk, which I still believe. A lot of people don’t change their default settings. And though Facebook shows a privacy indicator every time you’re about to post, many people ignore it and end up sharing more publicly than they’d like to.

More recently, Facebook has also been giving marketers limited access to searching the firehose of public posts, and encouraging users to post more publicly with hashtags, trending topics, embeddable posts, and other Twitter-like features.

Getting people to share publicly gives Facebook better data to improve everything from search to artificial intelligence, which it sees as a positive. But the honorable thing to do would be defaulting people to share with friends, and giving them the choice to share publicly – not vice versa as it does now.

Yet still, Zuckerberg seems to see a little bit of Facebook’s innovation in Snapchat. He continued his discussion of how Facebook created a home for previously unshared content, saying:

I think a lot of the most interesting startups today are actually doing different interesting things like this. Whether they’re messenger companies that are allowing different ways to communicate very quickly with small groups.

I think Snapchat is a super interesting privacy phenomenon because it creates a new kind of space to communicate which makes it so that things that people previously would not have been able to share, you now feel like you have place to do so.

And I think that’s really important and that’s a big kind of innovation that we’re going to keep pushing on and keep trying to do more on and I think a lot of other companies will, too.

So just because Facebook’s attempt at ephemeral messaging Poke failed and its bid to acquire Snapchat was turned down, don’t expect it to bow out of this fight. If there’s sharing that people aren’t doing on Facebook today, you can bet Zuckerberg will try to absorb it somehow.

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Maybe with a more tactful approach to its quest “to make the world more open and connected,” that sharing would already be happening within its walls.

Facebook’s privacy changes and constant prodding to share more widely have generated a fair amount of ill-will. So perhaps Zuckerberg shouldn’t see Snapchat, where you get to specifically choose who to share with every time, as a “privacy phenomenon.”

Maybe if people weren’t worried they were always one wrong privacy setting away from broadcasting to the entire world, they wouldn’t be so desperate for Snapchat.

Additional reporting by Billy Gallagher

[Image Credit: L.A. Cicero via Stanford]

IGT Not Deterred by Zynga Scrapping Real-Money Gambling Plans

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In its Q2 earnings report earlier this week, Zynga said it has abandoned its plans to pursue real-money gambling in the U.S. But Nevada-based IGT, which makes both physical and virtual casino games, said its plans are unaffected.

“What Zynga’s finding out is that breaking into real-currency wagers is a difficult thing,” said executive VP Robert Melendres, who heads IGT’s interactive division. “They built their business as more of a causal social gaming business. We are well situated to take advantage of [real money], just as we’ve done in Europe.”

Melendres’s goal is “convergence”: Bringing the experience someone might have playing, for example, a Wheel of Fortune slot machine (which IGT develops and manufactures) with the separately branded games of its social casino product DoubleDown Casino. In addition to getting cleared by regulators, he said part of the challenge is in the gameplay itself: Offering the same odds and the same “thrill” (his word) of risking real money that one gets in Vegas.

IGT acquired DoubleDown for $500 million in early 2012, one week before Zynga announced its now-scrapped casino ambitions. The Facebook-integrated site now offers roulette, blackjack, video poker and 37 slots games, which – like many of the innumerable competing social/mobile casino games – encourage users to purchase virtual currency, which is then what’s (legally) wagered.

According to its Q3 earnings report, the company’s social casino gaming revenue is up 105 percent year over year to $61.4 million, and monthly active users increased 28 percent from 5.2 million to 6.7 million in the same time frame. But Melendres said he is confident that IGT will be part of the “first meaningful wave” of real-money gambling for players in states that have legalized it, expecting to have a foot in the door by Q1 2014.

The real-money online gambling market, which H2 Gambling Capital said currently grosses about $30 billion worldwide, already surpasses other forms of social gaming and is expected to keep growing, as shown in this chart from Betable.

Zynga’s New CEO Don Mattrick Says It Won’t Be Quick Or Easy To Get The Company Back On Track

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Don Mattrick, the new Zynga CEO announced at the beginning of the month, offered his initial on-the-job observations today during the conference call discussing the company’s second-quarter earnings.

Mattrick (on the right of the photo with Zynga founder and former CEO Mark Pincus) started out by offering some positive commentary, saying that the company “caught lightning in a bottle” and “achieved in only a few years what most companies took a decade or more to do.” However, he acknowledged, “We’re missing out on platform growth that Apple, Google, and Facebook are seeing. In short, we can do better.”

So how is he going to try to turn things around? He said he’s going to be working with the company’s leadership to “challenge previous assumptions” and to focus on “business fundamentals – which, candidly, we’ve struggled with over the past year.” Mattrick predicted that there will be two to four more quarters of volatility as the company tries to find a new direction.

“Getting a business back on track isn’t easy and isn’t quick,” he said.

Pincus, now Zynga’s chief product officer, was also on the call, and among other things, he said he was impressed that Mattrick set up his desk in the middle of the Farmville studios. Both Pincus and Mattrick described their relationship as one between “partners”.

Mattrick said he’s also going to discuss his priorities on this call – I’ll update this post when he does.

Update: Later in the call, Mattrick said his priorities for his first 90 days on the job include “getting under the hood” to evaluate the business, identifying the real market opportunities, improving product quality, looking at how people are deployed across the company, and reassessing the product pipeline. He also suggested Zynga is a young company that has “the ability to break some bad habits” but that while he’ll be in listen-and-learn mode initially, “When it becomes clear what change is necessary, I’ll move quickly and decisively to do what’s in the best long-term interests of our players, our employees, and our shareholders.”

He concluded, “There are some good winds at our back, and my job is to get our sails up and Zynga pointed in the right direction.”

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