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Internet Edition, April 18, 2001, Page 1


Dairy Management expects to hire an "issues management" firm by mid-May, says consultant Jerry Swerling, who is handling the search for the trade group.

Fleishman-Hillard, Edelman PR Worldwide, Weber Shandwick, Porter Novelli and Burson-Marsteller are under consideration for a PR program that could top the $2 million mark.

DM wants to be prepared if U.S. consumers become skittish about the safety of dairy products.

That could very well happen if an outbreak of foot and mouth disease or Mad Cow disease happens here.

Swerling, who is based in Marina del Rey, Calif., said his search has no impact on current PR campaigns conducted by the milk industry, such as BSMG Worldwide's "milk mustache" campaign.


Miller Shandwick Technologies picked up the Segue Software account in a pitch that included nine other firms.

Bill Siegel, director of corporate communications at Segue, started the search in mid-January.

Porter Novelli, Blanc & Otus and The Weber Group were among those he considered for the account.

He picked MST because of its "high amount of energy" and its plans for an aggressive outreach effort to both media and potential corporate customers.

Miller Shandwick's goal is to help Segue replace some of its dot-com customer base with more established companies.

The Lexington, Mass.-based company does sell e-business reliability software to giants such as Fidelity Investments, Dell, Bank of America, Sears Roebuck and Merrill Lynch.

Dionn Tron, VP/corporate communications & PA, Agfa Corp., is now VP-communications at Pratt & Whitney. Moyer, Sherwood Assocs. handled the search...Jim Martinez, who was president of PR at KemperLesnik Communications for a year, is now senior VP/associate general manager at GCI Dragonette. He is to handle corporate and high-technology PR for the Chicago office of GCI Group...Victoria Shire was hired by R.R. Donnelley & Sons as senior VP-corporate communications. The 46-year-old executive had been managing director in Burson-Marsteller's "change communications" group in Chicago.


Powell Tate is playing a role in the World Diamond Council effort to pass its bill restricting trade in "conflict diamonds," according to Larry Barrett, VP at PT.

"Our client is Tiffany & Co., which is a founding member of the WDC," he told this NL.

The measure was written by Akin, Gump, Strauss, Hauer & Feld, and approved by the WDC at a January meeting in London.

Barrett, as Tiffany's representative, discussed U.S. public opinion on the blood diamond issue during that London meeting.

PT also played a role in the placement of a Chicago Tribune op-ed piece that ran on Feb. 14. It carried the byline of Michael Kowalski, president & CEO of Tiffany, and asked for government regulation of the diamond trade.

PT's sister company, Cassidy Cos., handles lobbying for Tiffany.


Hill and Knowlton has won the $1 million pitch for Sony's PlayStation 2 computer game system account. Fleishman-Hillard was the incumbent, handling the launch of the original PlayStation.

The Sony console became last year's must-have toy after Sony announced it could only deliver half of the million units it had promised for Christmas.

Sony now says its production is back on track. It produced more than three million units for the North American market by the end of March.

The company will double worldwide PlayStation production to 20 million units during the next year.

H&K's San Francisco office will handle the PlayStation account. It will be assisted by the firm's Blanc & Otus high-tech unit.

RF's McDade Joins H&K

H&K named Ruder Finn's Paul McDade as director of its worldwide healthcare practice.

He reports to CEO Howard Paster, and joins H&K's worldwide executive committee.

Paster praised McDade as an executive equipped with "an unsurpassed depth of expertise and understanding of health and pharma."

As RF's executive VP/healthcare director, McDade counseled clients such as Eli Lilly, Johnson & Johnson, Novartis and Wyeth-Ayerst Labs.

Prior to RF, McDade did a stint at Edelman PR.

Internet Edition, April 18, 2001, Page 2


Kara Ingraham, 50% owner of Editorial Media & Marketing International with Paul Holmes, claims in papers filed with the New York State Supreme Court that the new Sabre Awards program of Holmes is damaging the value of the Creativity in PR Awards program that EMMI has conducted for 10 years.

Ingraham asked the Court to appoint a temporary receiver "to protect against further dissipation of EMMI's assets, to collect EMMI's accounts receivable, dispose of EMMI's assets in connection with the dissolution proceeding and to protect the interest of EMMI's creditors and stockholders."

Jeffrey A. Reich of Reich, Reich & Reich, White Plains, is attorney for Ingraham. David Halperin represents Holmes.

Holmes doesn't think his Sabre show will hurt CIPRA. However, "if CIPRA is in any way diminished, it's only because I am no longer associated with it," Holmes told this NL.

PR firms, he said, submitted entries to the CIPRA competition because they understood it was the "Paul Holmes brand." The "reality is that my name stands for something in PR," he added.

Holmes described award programs as a "strange business" that follows a more-the-merrier line of thinking. PR firms are hungry for recognition so they send the submission to every awards program, according to Holmes.

Debt Exceeds $200,000

Holmes said he believes company debt "exceeds $200,000" and in addition to that $120,000 is owed in payroll taxes. Holmes and Ingraham accuse each other of failure to pay the payroll taxes.

"Ingraham did not do her job and amongst other things, allowed payroll tax now owed in the sum of $120,000," says an affidavit by Holmes dated Feb. 7.

Holmes says Ingraham took a four-month maternity leave last summer while drawing full salary. He said that she continued to function from home and he "relied on her continued interest and involvement in the business of EMMI."

Ingraham, in her affidavit, says that she and Holmes "agreed that, while I was on maternity leave,Holmes would manage the distribution of all corporate funds and sign all of EMMI's checks. When I returned to work in August of 2000, two quarters of payroll taxes had not been paid by Holmes."

Reich said April 13 that Holmes and Ingraham are cooperating on an auction of the assets of EMMI including the CIPRA awards contest, the website address of, Reputation magazine (not currently publishing), the former Inside PR Newsletter and other assets. An announcement may be made this week, he said.

EMMI Awards Are Not Unique

"While there is an inference that the EMMI program is unique in content, the fact is that it is only one of perhaps a dozen of such awards programs in the PR field, all of which have similar formats. Beyond this, given that EMMI has discontinued its operation, I obviously am compelled to earn a living in the PR field, which is the only field that I have been engaged in for the past 15 years. Ingraham's suggestion that I am not entitled to earn a living in the PR field is totally without merit," siad Holmes.

Ingraham also accused Holmes of hiring people the company could not afford and revamping the company's website when the company could not afford that. Holmes denied those charges.

"Involved With Employee"

She also says that Holmes, in March 1999 told her that he was "involved in a romantic relationship with an EMMI employee."

Ingraham said this was "not prudent" and exposed EMMI to a "potential legal claim." She said she and Holmes discussed this with EMMI's attorney and that Ingraham pressed for the dismissal of the employee. The employee then resigned, said the Ingraham affidavit, but "these events caused a strained relationship between Ingraham and Holmes which thereafter inhibited their ability to effectively cooperate in the management of EMMI's business affairs."

Holmes, in his affidavit, said Ingraham's charge "is completely and totally irrelevant to this proceeding and has been included solely to publicly besmirch my reputation."


Access Communications has picked up the Limited Too account, according to Matt Afflixio, senior VP at the San Francisco-based unit of Interpublic.

The job is to enhance the "brand" of the "fashionware" retailer targeting girls from seven to 14. LT has more than 400 stores.

Afflixio says Access will handle "mall events" throughout the U.S. this summer, offering LT customers and parents chances to win trips to New York for an August concert in Central Park.

Judith Sussman, GM of Access New York, also has a key role on the account.


Archer Daniels Midland Co. has replaced its long-running "Supermarket to the World" ad slogan with the tagline, "The Nature of What's to Come," emphasizing the company's efforts to develop new products from natural, renewable resources such as soybeans and corn.

The ads, which are a fixture on Sunday morning TV talk shows, also show a redesigned logo that features a green leaf inside of a blue diamond, instead of a symbol for a chemical molecule.

ADM portrays itself in the new ads as a technology-savvy problem solver on issues such as hunger and air pollution, using soybeans and corn.

BSMG Worldwide is handling PR for the campaign while sister firm FCB Chicago handles ads. Karla Miller, corporate communications manager for ADM, said the combined ad/PR budget for the first year is between $30 and $40 million.

Internet Edition, April 18, 2001, Page 3


Five columns are making their first appearance in the May issue of Yahoo! Internet Life, which has been redesigned to put greater emphasis on service, news, and "fun" sections.
The new columns are:

-"Privacy Watch"-Los Angeles Times<D> columnist Robert Scheer investigates online security in his new monthly column.

-"Talk of the Net"-Executive editor Larry Smith presents snapshots of digital culture taken from the ways everyday surfers use the 'Net to scenes from the online subculture.

-"Style/Ask Warren"-Under the direction of style editor Warren Christopher, Y-Life presents online shopping destinations, and consumer advice.

-"Content"-Senior editor Bilge Ebiri leads a team of critics as they review online-original film/art/games/books. Christopher Lehmann-Haupt, a former book reviewer for The New York Times, who was recently named to write obituaries, joins Y-Life as e-book reviewer.

-"E-venger"-Consumer advocate Laura Kaiser will provide material for this column.

Yahoo! Internet Life was started as a quarterly with a rate base of 100,000 in the spring of 1996. Since its change to monthly frequency in September of that year, the magazine's rate base has grown to 1.1 million. Barry Golson is editor-in-chief.


New York-based celebrity PR pro Bobby Zarem reveals how he creates celebrities in the May issue of Brill's Content.

"It's the pitch letter and the [gossip] column campaign and the continual making of connections," Zarem told Abigail Pogrebin, a correspondent for the magazine.

"More specifically, it's about telling reporters why someone's a story, then persuading the city's powerful gossip columnists to mention her in the way Zarem wants," reports Pogrebin.

"Next, it's creating `an event,' a celebrity-packed, buzz-generating party, at which the press can meet the client. It's Zarem's job to ensure that the party is `important and glamourous' enough to attract coverage.

"Brick by brick, a celebrity is built," said Pogrebin.

Zarem, who met Denise Rich ten years ago after her divorce from fugitive financier, Marc Rich, was not even prepared for Pardongate and how famous his client would actually become, said Pogrebin.

Which Reporters Matter?

Zarem also offers his rundown on which gossip reporters matter and why.

-"Richard Johnson's `Page Six' in The New York Post is the first thing any publicist or magazine editor looks at in the morning, followed by Neal Travis' column, which faces `Page Six'; Mitchell Fink is important because his column runs next to `Rush & Molloy' in The New York Daily News, and they're usually read consecutively; Jeannie Williams' column in USA Today is `read in every city in the world'; Variety's Army Archerd `reaches the entertainment industry before they pee.'"

Zarem said neither Cindy [Adams] nor Liz [Smith] has ever played a role in any of his campaigns.

"Every time you see a column item doesn't mean Bobby Zarem designed it. I have only ever done a column item if it's part of a campaign," the 64-year-old Zarem said.


Newspapers can draw more readers by taking a human angle to stories, a readership preference survey shows.

The study found about 85% of American adults look at newspapers each week, but only a third were heavy readers.
The study shows readers expect a variety of content from their daily newspapers, but certain kinds of news and information have greater potential to make them read more.

At the top of the list is intensely local, people-centered news, which includes stories about ordinary people, community announcements and obituaries.

Lifestyle news-including stories about health, home, food, fashion and travel-also has high potential to increase readership.

The study recommended revising news coverage to make it easier for readers to relate to it. Those polled like feature approaches on many issues, ranging from science and the environment to health and food.

The survey of 37,000 people was done by the Readership Institute at Northwestern Univ.'s Media Management Center.


Staci Kramer, a reporter for, questions why Oracle has stopped running ads in Computerworld.

"That policy changed abruptly, a source familiar with the situation told, just after the magazine ran a March 19 cover story that described Oracle's pricing as an obstacle to its success," said Kramer.

Oracle spent about $2 million in Computerworld's 50+ domestic and international editions last year, making it one of the tech publications's top advertisers.

Oracle spokeswoman Jennifer Glass said the move was part of an overall strategy of spending more money in the business category to reach top executives and less in tech publications.

!Gusto!, a new food and lifestyle publication, makes its debut this week. The magazine, from the publisher of Cooking Light, is targeted at readers in the growing Hispanic market.

(Media news continued on next page)

Internet Edition, April 18, 2001, Page 4


"For the most part, talk was of failed business models, lessons learned and challenges ahead," reports Aparna Kumar, who covered the April New Media Conference at the Univ. of California at Berkley, for

According to Kumar, Paul Grabowicz, who is director of the new media program at UC's graduate school of journalism, got right to the heart of the matter when he asked: "Is anyone willing to pay for what we do as journalists online?"

Stewart Alsop, a general partner at New Enterprise Assocs., a venture capital firm, said "funding media companies was a one-time phenomenon, and it's over."

The general consensus was that online news is a commodity, the existing ad models have been a failure and consumers won't pay for content, Kumar said.

"There may be a business model out there no one's invented," said Vin Crosbie, president of Digital Deliverance, an online consulting firm.


Doctors and medical experts are the most popular interview guests for TV talk shows on a year-round basis, according to D S Simon Productions.

Eighty-one percent of stations who responded to the company's annual survey said they most frequently interview health professionals.

Celebrities were second as 76% of stations responded that they were likely to interview celebrities on their morning shows, and 71% reported they are most likely to interview a technology, computer or gadget expert.

Stations were also asked what types of guests their viewers responded to best: 67% said viewers responded best to doctors and medical experts; 64% said celebrities were well received; 50% said viewers responded best to consumer advocates and experts, and another 50% said their viewers like chefs and culinary experts.


Women's Wear Daily's website will make its debut in May. It will feature a column about fashion-industry gossip. The twice-weekly column will be written by Jeane MacIntosh, who left The New York Post a year ago where she was a "Page Six" reporter.

The San Jose Mercury News published the final issue of SV Magazine, its weekly Sunday magazine, on April 15.

David Yarnold, executive editor, and managing editor Susan Goldberg, in a memo to employees, said the closing was a trade-off to preserve jobs.

In the early 1980s, more than 300 newspapers published locally edited Sunday magazine supplements. About a dozen newspapers still publish their own Sunday magazines. The Mercury News has published a weekly magazine since Sept. 1969.


NBC is closing its loss-ridden Internet subsidiary, NBCi. The company believes there is no hope of the website becoming profitable.

Many of the 300 jobs there will be eliminated as the unit's assets are merged into NBC, which will pay $2.19 per share for NBCi, or about $138 million.


Rodale will begin publishing a new magazine called Organic Style in the fall.

The new magazine, which may replace Rodale's cornerstone title, Organic Gardening, will combine beauty and fashion with food, home and gardening.

The magazine's Sept./Oct. issue will debut with a rate base of 400,000.

Fitness Swimmer, another Rodale title, has been closed down.


Lou Dobbs has agreed to rejoin CNN on May 14 as anchor of "Moneyline," a financial news program that he started 20 years ago.

Dobbs left in 1999 after feuding with then CNN USA president Richard Kaplan, who was forced out last summer.

After Dobbs' resignation, the show's rating fell behind CNBC's "Business Center," and Stuart Varney, who hosted the program with Willow Bay, resigned in March. Bay is based in Los Angeles.

Dobbs, who is contractually prohibited from working for a TV news network other than CNN until next year, had entered into a joint venture with NBC to write a financial newsletter and to produce business news radio reports.

He will retain his ownership stake in the Internet website,


Cord Meyer Jr., 80, who had supervised Radio Free Europe and Radio Liberty when he was a CIA agent for 26 years, holding management positions in covert operations and becoming second-in-command of worldwide clandestine services, died March 13.

Meyer's first wife, freelance writer and editor Mary Pinchot, was fatally shot in 1964 while walking in Georgetown.

Following her death, the former Mrs. Meyer's sister and brother-in-law, Benjamin Bradlee, who later became executive editor of The Washington Post, said they saw a CIA counterintelligence officer trying to break into Mrs. Meyer's house and take her diary.

The Bradlees later found Mrs. Meyer's diary, and it "disclosed an affair between Mrs. Meyer and President John F. Kennedy," according to The New York Times.

Her murder remains unsolved. Don Shannon, a retired Los Angeles Times foreign correspondent, has been doing research into the Meyer murder.

Internet Edition, April 18, 2001, Page 7


San Francisco-based PR pro, Michael Fineman, who is the author of the "Annual Top 10 PR Blunders List," said Coca-Cola's agreement to provide optional water and juice beverages in its school vending machines and United Airlines' decision to honor the sale of more than 100 international travel tickets, mistakenly priced on the Internet at less than $100 each, show an increasing urgency among businesses to be recognized as good corporate citizens.

"Corporate awareness of public image has increased tenfold in the last decade," said Fineman, president of Fineman Assocs. PR.

"Companies and organizations in today's competitive, volatile and often reactionary marketplace understand that their names must ring sweet and true. Public goodwill translates into loyalty, sales and, ultimately, permission to achieve corporate objectives.

"From all appearances, the United Airlines and Coca-Cola responses to marketplace sensitivities were more than spin; they were genuine and the right thing to do. And it's smart to show a little humility while the whole world is watching," he added.

"Good PR means establishing trust and winning friends and allies," said Fineman.

He said firms wishing to stay in positive perception territory should:

Communicate regularly about the overall benefit your organization represents and its standing as a good corporate citizen; Demonstrate care for your audiences; Be responsive to public demand for timely information; When trouble looms, be prepared to either accept responsibility for your company's potentially negative impact or, if falsely charged, to tell your side of the story; Do not panic or respond defiantly, and Never lie.


A new global media analysis by CARMA imMEDIAate, Washington, D.C., shows poor earnings/financial reporting can take a toll on the image of companies.

The study found the companies that are getting the most coverage of their earnings are fairing poorly. Of the companies that got at least 25 world-wide articles on earnings and finances, more than two out of three got critical coverage.

Albert Barr, CEO of Carma, said the media are driving what people think about these companies.

"What you read influences your perception. Many of these companies are facing an uphill battle not just in terms of getting their finances in order but also in the court of public opinion," said Barr.

Articles in North America, Latin America, Europe and Asia Pacific were analyzed.

BMW, which received the most favorable reporting, topped more than 700 companies monitored.

In declaring bankruptcy, eToys fared the worst for its earnings coverage.


Dow Jones & Co., publisher of The Wall Street Journal, Barron's and 35 community newspapers, slashed 202 workers from its payroll as its first-quarter ad volume sank to its lowest point in five years.

The cutbacks represent about 2.4 percent of its payroll. An additional 300 positions will be left unfilled saving the company about $60 million a year. The New York Times Co. is also cutting staff due to the advertising slowdown and hazy economic outlook.

President Russell Lewis will determine how many staffers will be let go during the next two to three months. That number depends upon how many employees opt for a buyout program.


The U.S./China "incident" was largely a bi-lateral squabble between the two countries that is expected to have a minimal impact on Beijing's effort to host the 2008 Olympics.

That's the feeling of Mike Holtzman, senior VP and director of new business development, at Weber Shandwick Worldwide, which is handling the Chinese Olympics bid.

He has been monitoring the world's media since the U.S. spy plane landed on Hainan Island April 1.

The standoff, according to Holtzman, probably had more impact on whether China will gain entry to the World Trade Organization.

Holtzman is happy the standoff is over because if it went on any longer it could have seriously hampered China's bid. He heads a team of 20 staffers in the U.S. working on behalf of the Chinese bid.

Coca-Cola's new ad slogan is "Life tastes good." The new tagline, which replaces "Enjoy," made its debut on billboards, which were unveiled last week in without a public announcement.

Sophie Rhys-Jones, who is married to Prince Edward of the U.K., is stepping down as chairman of R-JH, a London-based PR firm she started in 1997 with Murray Harkin.

Her resignation came after Britain's best-selling paper, The News of the World, published taped interviews with her and Harkin, 36, in which she spoke of her misgivings about leading British politicians and other members of the Royal family.


Cairns & Assocs., New York, is handling Snuggle fabric softener's National Bedtime Story Month.

The promotion, which is designed to raise awareness of the role parents play in preparing children for learning by reading aloud with them, is being run in partnership with the National Center for Family Literacy, a non-profit organization.

Karen Maletzky of C&A said the program features a series of celebrity reading events/pajama parties in six U.S. cities, a parent education program, and interactive online programming for parents and kids.

Internet Edition, April 18, 2001, Page 8



When NIRI/New York announced that the press was invited to a talk April 11 by Colgate-Palmolive CEO Reuben Mark, we were enthralled at this indication that the era of "Fair Disclosure" was starting to dawn.

"Reg FD," recently passed by the SEC, means that the press and public are to get the same access to corporate news and information as analysts. Mark, the NIRI press release said, will discuss "the critical role" IR played in helping CP to increase return to shareholders by more than 37 times. This we wanted to hear. We assigned a reporter and gave her a camera and a tape recorder to cover the event set for 6 p.m. at the Hotel Intercontinental. NIRI/NY, the largest chapter with 700+ members, was a fitting venue, we thought, to bring the press on board in IR.

"This Is Off-The-Record"

However, we were told at 3:45 p.m. on April 11 by the chapter that it just found out that "Mr. Mark does not choose to have the press there." Reporters could attend but everything would
be "off-the-record."

Although Reg FD was passed last year, we have noted almost no change in attitude among the public companies we cover including the big public ad agencies. The press is simply not wanted. Few people in NIRI, a member noted, have press backgrounds. The IR culture is analyst-oriented. Symptomatically, NIRI refuses to give any reporters a copy of its directory of 5,000 members, although member directories are routinely available from PRSA, IABC (when it published one), ASAE and numerous other groups that encourage communication.

How can we call up NIRI members and ask them what they think of NIRI policies if we don't have the directory, we asked IR counselor Jane McCahon, the new chair of the group, and Lou Thompson, president. Also, wouldn't it help reporters to reach the now-friendly IR pros if they had the phones, e-mails, etc., of more than 5,000 of them? NIRI says its policy is to encourage members to talk to the press.

The new financial troubles of Editorial Media & Marketing Int'l show that it is time for the big PR firms that bankrolled this operation to step in and take control. Porter Novelli, Burson-Marsteller, Edelman PR Worldwide, Ketchum, BSMG, GCI Group, Hill and Knowlton, Fleishman-Hillard, Manning, Selvage & Lee, Ogilvy, Weber, etc., have pumped hundreds of thousands of dollars into EMMI in the form of ads and award contest entry fees and $250 and up banquet tickets so they could accept numerous awards from EMMI. The company now owes at least $200K to suppliers and is $120K behind on payroll tax payments, according to legal papers. What about the PR people who subscribed to EMMI's products including an e-mail NL?

EMMI's Finances Revealed in Suit

The sad state of EMMI's finances became public four years ago when it sued Colorado printer broker Bob Bell for $5 million. EMMI was unable to complete payment for $56K for two issues of its former magazine, Reputation Management, to the satisfaction of Bell. He wanted full payment and the check to clear since he had problems collecting from EMMI.

No doubt Bell should have sued EMMI but EMMI beat him to the punch, charging, in effect, that Bell "stole" ad mechanicals (actually owned by many of the big firms above) because he wouldn't return them until EMMI paid. EMMI also said Bell was keeping valuable lists and other property of EMMI. Papers filed in that suit showed that EMMI had been sued by its previous printer for nonpayment and that a court-supervised payment schedule had been set up.

Bell, claiming his few assets were exhausted in the initial legal sparring with EMMI, said he couldn't afford the minimum $10K needed for a New York lawyer and had to drive to New York to represent himself for a one-day court hearing. He still claims EMMI and owners Paul Holmes and Kara Ingraham owe him and the printer $100K.

We felt an injustice had been done to Bell and appealed to the big PR firms to see to it that EMMI paid its printing bills. We showed Bob Druckenmiller of Porter Novelli the papers in the two lawsuits and asked his help in settling a suit that made the PR firms and PR look bad. He said he would take up the matter with David Drobis of Ketchum. No word was ever received from either PR executive.

Astounded by the callous disregard of Bell by firms with incomes of $100 million+, we asked other PR pros for an explanation. "The firms are not going to do anything that might interfere with the awards EMMI gives out," was the answer.

The non-apology apology that the U.S. made to China to get back our crew was hastened by the revolt of consumers at Kmart and other chains, who noticed that the shirts, socks, shoes and many other items on the shelves came from China, where 700 million workers get about $1 a day. This is far below the 87 cents an hour needed for subsistence, say U.S. labor groups. Cheap labor is the real attraction of China for U.S. business. The U.S. purchased $84 billion more in goods from China than China did from us last year. China, according to No
, which studied labor practices in 18 foreign countries, is the hellhole of the Far East for laborers, where pay is lower than any other country. Kmart, Wal-Mart, Ann Taylor, Liz Claiborne, J.C. Penney, Ralph Lauren, Esprit and The Limited are among chains using China labor, said a 1998 study by the National Labor Committee, New York.


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