Some Observers - Emerging Futures + Technologies + Consumers

Ecosystems and Emerging Nets

In my talk last week at Aalto I discussed the concept of ecosystems, of which the BoPNet is an emerging one, and described how we often have to make choices of which ecosystem we belong to: Win or Mac, Android or Symbian, Western tech or now Eastern tech. The BoPNet is itself an emerging system on mini-ecosystems, each devised around the local needs, capabilities and tools available. Where we used to make choices about ideologies, religions or other social systems, increasingly we have to choose around technical platforms that will shape our social behaviors.

One of the pleasant surprises of the later stage of the workshop was how many of our teams created solutions that were ecosystem-based, leveraging many local assets in their target area, be it Lagos, Cairo, Indonesia or Afghanistan, to create a semi-contained "platform" to improve local lives which could be scaled and connected to other similar platforms nearby into a larger system of systems. One group even created a library or set of modules around needs that could be ported to other networks—seeds that could be spread to other fertile ground.

This question of ecosystems will become increasingly important as these local nets emerge and connect. Force them to make long-term ecosystem choices too soon, and the lock-in may stifle or kill bottom-up innovation. In developed markets, there is always demand, and that provides a cushion to absorb this blow. In emerging markets and fragile local economies, this demand is not strong enough to do so. Letting local needs and local desires call the tune for ecosystem development is important, and our "co-creators" in the workshop got that. Whether larger practices of top-down ecosystem lock-in are forced in the BoP's emerging networks of communication, transport, health, education etc. will determine how well the smaller cells of the net emerge, grow and link. I hope the thinking we saw in our workshop is the new logic that pervades going forward so the green shoots of network development can open and grow.

 

Filed under  //   ecosystems   networks  
Posted by Scott Smith 

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Workshop Recap: Designing Solutions for Emerging Ecosystems

       
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Workshop_Recap_Designing_Solut.zip (569 KB)

Coming to the end of the week in Finland, the dust has now settled from our workshop on innovations for emerging markets this week at Aalto Design Factory (though the snow continues to fall) and there finally has been some time for reflection. First, a huge thanks goes out not only to my partner in this prototype, Niti Bhan, but to the generous team at the Design Factory and its leader, Kalevi Ekman as well. Without Niti's personality, her suggestion of the workshop, and her work within the Design Factory, none of it would have started. Without the DF team's generous support and interest, none of it would have actually happened. And from the workshop and the connections made, both human and cognitive, many positive things will surely emerge.

The Design Factory describes itself as a passion-based co-creation platform, which suited the day very well. Many people showed up in the dark Nordic morning to take part in this event because of their passion for combining design, innovation and social development. Because of this, collaborative creation of ideas was the key thread throughout the day. The blend of students, entrepreneurs, and people stepping out of their roles in private companies and government bodies—with both local values and global views—was exactly what was needed. We put the workshop here because, as Ekman pointed out before the event, Finland is uniquely positioned to leverage its skills, assets, energy, IP and unique social values to help solve serious problems and improve life elsewhere in the world. 

Niti and I took the first hour or so to describe the realizations from our respective roles and trajectories that brought us to this point—mine from the consumer culture side, hers from her field work experience and research in low income, challenging environments. Along the way, these trajectories met, and new patterns are now emerging, showing us possibilities of new ecosystems blending technology, social and cultural structures that are uniquely configured.

We were there just to set the table, however. The core of the day, and the best part of the workshop, was generated by the participants. Organized into teams, they were tasked with taking on a new unfamiliar roles, in new countries, cities and situations, and a unique set of external factors and barriers around which they needed to create a solution for a specific target user. It was fitting that took place within the Aalto Ventures Park facility, which itself is a converted workshop. With a variety of tools, materials and working styles, each created something uniquely suited to their task: water delivery systems that doubled as information networks, thoughtfully conceived community centers in conflict zones, a mobile platform for local jobs, and more. Each used the human networks already in place, and each contained multiple innovations worth considering alone. 

Given that our tendency today is to throw technology at problems in scattershot ways, most striking to me was how the groups constructed or leveraged existing networks and ecosystems giving only the lightest touch to technology—resulting in an appropriate simplicity and resilience in every solution. No hammers looking for nails, no new complexities created to suit potential capabilities, just carefully considered balance of tools and needs. If this was the only takeaway, it was a day well spent. Luckily, there was a lot more to leave with, not least a sense of momentum and whetted appetite—for us, for those who participated, and for the broader Aalto community as well.

 

Filed under  //   Aalto   BOP   BOPNet   co-creation   design   Design Factory   ecosystems   Finland   innovation   technology  
Posted by Scott Smith 

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Energy/Communication Parallels: Straight to Solar?

http://www.flickr.com/photos/1village/ / CC BY-SA 2.0

Katie Fehrenbacher ask today on Earth2Tech whether evolution future energy infrastructure in developing markets might mirror the leapfrogging dynamic we've seen in the past decade with communications in these same markets? 

It's an apt question—even with the upfront investment needed in mobile devices and infrastructure, takeup has been increasingly robust, in part because of the perceived return on investment by customers: I pay a little more, I can do a lot more. And operators and device makers have increasingly optimized their products and services for this market. Katie cites several analysts who believe solar may indeed follow the same path, and is perhaps already doing so.

Energy is a critical layer of the emerging BoPNet—the infrastructure ecosystem that is evolving uniquely around the needs of developing markets. It will benefit from the  proof of concept this mobile evolution has provided. Over time, successful growth in these cost-sensitive markets should provide innovations in design, service and business model that can be ported back to developed markets, and, like other BoP innovations, can provide needed changes in resilient communications, transport, energy, health care and other critical sectors for the rest of the world. 

These are all topics we will be discussing next week at our upcoming workshop. We'll report here on the new ideas and insights that emerge. 

Filed under  //   BOPNet   energy   leapfrogging   mobile   solar  
Posted by Scott Smith 

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Envisioning an Emergent BoPNet

Bunker Roy’s Barefoot College located in Tilonia, Rajasthan is the unique starting point for a story of resourcefulness and innovation under the most adverse conditions. The liminal space where high technology meets utter poverty can arguably be one of the most creative environments churning up such inventions as an amphibious bicycle in remote Bihar, car battery cellphone charging systems or even bamboo poles converted into antennas in an African village with no running water or electricity.

Originally supposed to be a one hour documentary on the barefoot solar engineers of Tilonia, illiterate women not only from the neighbouring villages of the desert state of Rajasthan in India, but now coming on scholarships from as far away as Mali, Uganda and Ethiopia, to learn how to build and maintain solar powered cookers and generators, the concept currently under discussion seeks to expand the sharing of the knowledge gained across geographical, cultural and language barriers.

ShareIdeas.org is a recently launched initiative by Vodafone and Nokia – an open source community based social media platform intended to support and propagate the sharing of information between NGO’s and other aid workers across the world on how mobiles can be used to improve the social and economic development of those at the bottom of the pyramid. This is currently in the wiki format and in English and only for mobile handset applications. It’s reach is limited to the literate and the internetworked.

Six months ago, at the Confederation of Indian Industry/NID Design Summit in New Delhi, I spoke on theresourceful inventions and innovations that those who lived amongst conditions of extreme scarcity created as solutions to their daily needs. To quote:

What I propose is that take Prof Anil Gupta’s work at the National Innovation Foundation, where teams of field workers keep their eye open for inventions in their travels through rural India and expand this into a global network. Numerous ingenious solutions have emerged, and as they have been developed under the most adverse conditions, are as ecologically sound as possible in terms of materials, recycling, energy etc consumed. […]

This “mash up” as they say, where information meets technology meets rural innovation can arguably provide a solution to not only India’s most pressing needs but also to more pressing problems facing all of us in the world today. A two way exchange of information that empowers, permits cocreation and connectivity, communication and commerce, will ensure that the next inventor in remote Bihar who develops an amphibious bicycle would not need to travel cross country to be noticed, funded, or noticed globally. India herself would have put him on the world map.

Solutions, business models, products and services that use the minimum of scarce resources, recycle or reuse materials, leave a minimal footprint on the environment and are sustainable have been extensively documented amongst the poor. But to our educated eyes they seem crude and primitive. So they are very often overlooked or ignored. Only the latest technology can provide us with solutions for the future, we seem to say.

What can we learn from these inventions and innovations as we look towards creating a sustainable ecofriendly lifestyle?  The technically proficient, the engineering experts, the world class designers are all who practice in conditions of abundance. They create with no shortage of materials, funds, resources, fuel or energy. As the Earth’s climate changes, and the environment suffers, our material and fuel resources become increasingly scarce, we must all seek new ways to making, doing and building.

The idea is to create a multiplatform delivery mechanism for this vital information, building on the Share Ideas concept mentioned above – first to discover and record such learnings from sustainable agriculture practices, renewable energy sources, innovative use of recycled materials, and other devices that improve the quality of life at the bottom of the pyramid. Then to share this information in an open source manner, disseminated with clarity across language and literacy barriers – do we use videos? Pictograms? Simple text? Multiple languages? And to share it on appropriate delivery mechanisms to reach those who need it the most – do they have broadband access? Or just cellphones? Is WAP the best way or is sms? All of these questions and more need to be answered as well. The infohub would form the seed of a global documentary series as well. We hope to cover Brazil, parts of Africa and India if not more locations.

Written in Singapore on 5th July 2007 as background for a conversation with the BBC.

Posted by Niti Bhan 

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What New Metaphors Will Emerge from Developing Markets?

PSFK today pointed to a brief essay on Mashable by Xerox's Venkatesh Rao regarding the evolving metaphors we use in innovation, specifically around technology. Rao's article, "How Conceptual Metaphors are Stunting Web Innovation" looks at how, like armies fighting the last war in this one, we tend to let metaphors around design and usage linger long after the platform from which we got the metaphor has moved from leading edge to baggage. 

As a Xerox researcher, information formats and functions are close to his heart, and he cites the way we've clung to ideas such as "open and close" for digital documents in the age of dynamic, collaborative content such as we find on the Web, often more of a fleeting collection of information than a closed-ended container. As progress, he cites Google Wave as at least moving on to the "stop and start" metaphor of recorded media, but suggests there are more interesting metaphors to be had and resulting innovations in our understanding and use of technology. 

What jumped out at me reading his essay is how, despite our grudging migration, we still rely on metaphors of experiences of the high-tech developed world. The folder, the desktop, the document—all artifacts of centuries of bureaucracy. Or, like clicking an imaginary shutter release, we mimic use of a modern technological artifact like a camera. I wonder, though, as cultures that weren't core to the initial phase of development of Western IT gain influence, what new functional or interaction metaphors will come to the for in the next, say, twenty years? How might content, communication, or digital socialization undergo new evolution based on metaphors that didn't come out of Chicago, Paris or Heidelberg in the last few centuries, but have been embedded in Jakarta or Sao Paolo instead, or from street subcultures or networks that aren't yet evident?

A lot of this work is happening now: the fantastic Younghee Jung, for example, has been working with colleagues for some time to better understand gestural languages and how they may impact interaction design, as have other teams at various device makers and academic centers worldwide. We are only just starting to see the earliest fruit of some of this work—interaction modes that will become common in years to come but which western consumers and designers haven't even considered yet. As we move into the era of touch and motion-based interaction, this gets even more interesting. Stay tuned.

Filed under  //   culture   gesture   information   interaction  
Posted by Scott Smith 

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One-Day Workshop on Innovation in Emerging Economies

To delve more deeply into the topics we discuss on Some Observers, Changeist + Emerging Futures Lab are collaborating on an upcoming event exploring near-future opportunities for innovation in emerging economies. The one-day exploratory interactive workshop will be held January 26th at Aalto Venture Park, Otaniemi, in the greater Helsinki area, and will explore the nature of the BoP consumer, technology behaviors, needs and barriers, and will allow participants to test their own assumptions and uncover new opportunities to serve these growing markets. For more information, contact Scott Smith at ssmith [at] changeist.com.

Filed under  //   announcements   consumers   events   innovation   technology  
Posted by Scott Smith 

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Just Good Enough, Again

In light of the recent upsurge in discussion around "good" over "great," I thought it would be useful to repost an entry from August 2008—almost 18 months ago—I wrote over at Changeism on the topic of Just Good Enough. The JGE phenomenon was taking shape even then, though the economic crash that manifested months later hadn't truly taken hold. We had been observing subtle signs of it for some time in both observational research, interviews going back as far as 2006-2007 with consumers, particularly at the low end of the economic spectrum, and of course via the constant horizon scanning we do as our foundational research. We took it on the road and raised it in workshops and briefings, though it was a hard time to get companies to let go of the "dominant logic" of Popu-luxe, and therefore be first-movers in delivering on this emerging need.

For better or worse, this idea is now making its way up to the stage as an major force in consumer lifestyle choices in the developed world. It has, of course, been a core factor in the lives of those in the developing world for decades—sufficiency versus luxury, getting by instead of getting ahead. It's a theme we continue to explore here from both sides.

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In the past year or so, we at Changeist have been talking about the concept of Just Good Enough, or what we call JGE for short. Thinking about JGE stemmed initially from study of how technologies are being developed or modified within the developing world for use there. Where resources such as energy, money or space are constrained, the lowest appropriate level of complexity, cost, functionality, or what have you, is what's needed. Anything else is a luxury--and expendable.

So, for example, why build a $20,000 luxury sedan when all the market needs is something slightly better and safer than a tuk-tuk? Hence, Tata has given us the Nano--the one lakh (100,000 rupees or about $2,500) vehicle that is suited to the needs of a growing sector of Indian society, somewhere below the middle of the pyramid, who need basic transportation that goes from point A to point B, at a minimal cost and with some basic trappings of safety. Pragmatism trumps the need for status in this sort of environment, the polar opposite of much of the developed world, particularly the US.

Or, when you have a house that is 75 square meters, share it with several generations of family, and don't have much privacy, why spend a huge portion of your salary for a desktop PC when your mobile phone does just what you need it to, well enough? If it carries an address book, has adequate basic Internet access for lo-fi text browsing, and allows you to stay in contact with friends and loved ones, then it IS a PC.

Only now, in the face of peaking technological and system complexity as well as against the backdrop of an entrenched economic downturn, is the idea of JGE catching in North America above the level of lower-middle class households. When disposable incomes are high, consumers are drawn to shiny premium features, always looking for a way to trade up to a higher level of product or service to show status. For the last 40 years, Americans bought because they could, even acknowledging economic trade-offs were being made by saving here for a premium service there, or Trading Up as Boston Consulting Group calls it.

Now, in the cold light of economic contraction, attention has turned to JGE: living with just enough money to get by, buying only what you need to be moderately happy or simply get through to the next paycheck. Buying vehicles in terms of tonnage has been replaced by buying ones that can do the basic job with a minimum of necessary styling. Basic coffee in a cup has moved into the space where exotic beans from obscure rift valleys used to sit. Inexpensive, low-end laptops look attractive alongside high-cost, bulky widescreen models. Consumers aren't going out buying expensive mountain or road bikes in the face of rising fuel costs, but basic cruisers are flying off the racks at bike shops.

These are only weak signals at the moment. The vehicles and laptops cited above are signals that have come from elsewhere. Europe and Asia have had low-impact city cars for some time, though R&D efforts to create not only cleaner but lighter vehicles for global markets has given this sector a boost. Lighter weight, cheaper basic laptops emerged in large part from efforts to create affordable devices for developing countries. Intel's competitive actions in the face of the OLPC helped spur OLPC clones for developed markets at just the right time.

Nonetheless these signals are coming in greater numbers, showing a growing demand for products and services that are appropriate for their circumstances and fit available resources in place of premium for the sake of premium. Prime areas of growth for JGE are housing, clothing, household items, personal care, consumer electronics, financial services, food and beverage: all areas where premium services exploded in the past decade, but which are seeing innovations in developing markets that can move to the developed world to suit the growing need in increasingly strapped developed markets.

Implications:

  • Slower replacement cycles for products. Consumers will hold on to both costly and everyday products longer, from smartphones to running shoes. Lower cost durability needs to be engineered in, with the potential to upcycle -- use the same platform and renew components as needed.
  • Greater interest in the simple choices. All-you-can eat services with high pricetags are set aside for basics at a manageable, transparent cost.
  • Greater need to focus points of delight. With most frills stripped away, companies will need to focus on points of delight such as hidden utility to provide consumers with clever functionality at a low cost. Think "virtual" GPS on the iPhone, or fold-up back seats in the Honda Fit.

Posted by Scott Smith 

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Food for Thought from an Essay by Keith Hart

Keith Hart, best known for his work on "informal economy", defining the vitality of the urban entreprenuerial spirit he encountered as a young anthropologist in Ghana in the early 1970s has just posted an essay called The Digital Revolution and me. While enthusiasts should certainly read the whole, here are a few snippets that I found thoughtful observations that relate to the explorations on this blog.

We are living through the first stages of a world revolution as profound, in my view, as the invention of agriculture. It is a machine revolution, of course: the convergence of telephones, television and computers in a digital system whose most visible symbol is the internet. It is a social revolution, the formation of a world society with means of communication adequate at last to expressing universal ideas. It is a financial revolution, the detachment of the virtual money circuit from production, linked to the West’s loss of control over the world economy. It is an existential revolution, transforming what it means to be human and how each of us relates to the rest of humanity. It is therefore also a revolution in anthropology that will make everything we have done so far seem like the prehistory of our discipline.
...

At about this time, in the mid-90s, the World Wide Web was making the internet more visual, personal and interactive. For two years I headed a Cambridge committee to explore the uses of audio-visual aids and information technology for teaching and research in the humanities and social sciences. People said there was no point in Cambridge University entering this brave new world; we were too old-fashioned and places like Middlesex Polytechnic had much more experience with online techniques. But I argued that over the centuries we had accumulated lots of beautiful stuff that could become a rich internet resource. In any case the digital revolution is not a linear development. Everyone enters it with their own bundle of specific advantages and drawbacks at a particular moment in time. The technology evolves, so that early users may be too adapted to older techniques, while latecomers can make more creative use of software that requires less specialist knowledge than before. The society made by the machine revolution is a river and you can never step into the same river twice.
...

And so to the last few years, to the social networking revolution and Web 2.0: Google, Myspace, Facebook, Digg, Flickr, Twitter, Stumbleupon, Flock, Wave and all the rest. This is the heart of the revolution I want to join. I love Twitter for the chance to project myself as an editor of sorts, sending the best economic journalism from Europe to American traders, gold bugs and currency freaks. I meet an interesting class of anthropologists there. And I hone my subediting skills on the 140-space limit. Social bookmarking really turns me on. Classification of knowledge was hitherto done by experts and every piece of information had its unique place in a folder somewhere. Now tagging makes it possible for anyone to leave a mark on something they like or consider useful and you can find their guidance with increasingly sophisticated software. The people are generating the categories; and even a search engine like Google is becoming obsolete because its millions of hits are impersonal, less attuned to the user’s own profile.
...

People ask me how I find time for my work with all this stuff. But, since exchanging Cambridge University for a Paris chambre de bonne 12 years ago, I have doubled my rate of publication over that of the previous three decades. My productivity as a writer benefits enormously from being online 12 hours a day. I can check anything in a fraction of the time. I stay at my work station longer when I can answer an email message there, keep an eye on a football match, surf the OAC for the latest developments. Sometimes the speed and diversity of my online connections generates a wave motion that carries my writing into unexpected regions of discovery. If this is the virtual social life, it will do for me. Bring on the revolution!
...

What have I learned from all this? I could quote from the introduction to this website:

The two great memory banks are language and money. Exchange of meanings through language and of goods through money are now converging in a single network of communications, the internet. We must discover how to use this digital revolution to advance the human conversation about a better world. Our common task is to make a world society fit for all humanity.

Filed under  //   anthropology   culture   Internet   society   technology  
Posted by Niti Bhan 

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Super Fakes, Open Source and Informal Channels of Innovation


Photo by Samout3

A recent string of interesting signals, including yesterday's New York Times post about the Chinese smartphone fake encountered at CES with the iPhone look, Android guts and faux HTC splashscreen may provide an interesting view of where innovation in mobile apps and services for emerging markets may come from in the near future. These signals tell me that we are approaching a point where said innovation is no longer just going to come from "official" device and application makers, but are starting to emerge from hidden development "dens" in places like China, Russia or Thailand as well as from Kenyan startups or American giants.

The numbers paint a story of probability. Somebody is actually counting and forecasting these illicit grey-market activities as best they can, and the most recent figures, from research house iSuppli, put Chinese grey market shipments at at least 145 million units for 2009. That's a growth rate of over 43% over 2008, and represents about 13% of global handset volume. This, at a time when the legit market has been slowing. And in those 145 million units, somewhere some interesting new innovations are taking place, and in the 145 million customers, some folks are getting what they want.

As Jan points out, at least a portion of these devices' buyers know what they are getting at purchase, and likely make their purchase decision based on a value for money tradeoff. They may be getting access to the (glancing) look and (approximate) feel of a smartphone, the cachet of the counterfeit brand, or, in the case of the Times example above (I suspect increasingly in the next few years) they are after some hybrid formulation of open source flexibility with proprietary look and feel. 

The latter effect is where we start to cross over into innovation territory it seems. In the past a hacker would have to reverse engineer or obtain a crack of an OS like Symbian, or fake up some melange of a platform to run on. Since the advent of an open source system like Android, which has allowed the legit developers to roll a mobile OS of their own, this is changing. One week it's HTC or Motorola making a new Android derivative and handset, the next it is Lucky Dragon's Mobiles 'R' Us with a smartphone/e-reader with MP3 playback. Or, more importantly, a device with apps written to suit local tastes, which presumably run beyond knock-offs into utility territory. If the big mobile companies aren't innovating for the grassroots fast enough, or can't be everywhere at once, the expertise gained over time in making passable hardware, combined with the ability to crank out a platform tuned to local tastes, puts Lucky's operations on a collision course with Moto or Nokia. Over time, this more responsive operation may win an increasing number of customers, as price and value converge. 

Imagine a time, five years hence, when West African developers creating apps for the specialized needs of the region crank out cheap Ivorian handsets from a customs-free, loosely governed black market zone like Bouake, where black market pirates roam free even today, making ersatz Arsenal tops and pseudo-Murakami LV backpacks. They will know the local market, they know how to make the supply chain run, and they can provide regional support. Not that far fetched.

Informal innovation, even illicit innovation, is nibbling around the edges now, just emerging on the radar. Whether its a no-name mobile bought in a Shanghai market, a People's Processor, a phone for the everyman, or a local operator that just happens to be seen as a terrorist organization, the boundaries around who happens to be a "legit" innovator and who is black market is blurring. Bottom-up innovation doesn't just come in an official wrapper, and increasingly, we will see consumers in parts of the world where price/performance is measured differently choose high technology from a broader bazaar of providers, as they do for low technology today. Today's No Name Inc. may be tomorrow's Notion Ink

 

 

Filed under  //   Android   counterfeits   design   grey markets   innovation   mobile   open source   stats  
Posted by Scott Smith 

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Leaner, Meaner, Cleaner Futures

Scott has written extensively on the shift towards "small" taking place referencing elements as diverse as the influence of the emerging BoPNet as well as incremental improvements. Now, McKinsey has released their research on the shift in consumer preferences in the packaged goods industry which ends with the following paragraph supporting this trend.

There’s evidence that the shift of consumers away from more expensive products is a widespread trend. In the consumer electronics industry, for example, McKinsey research found that 60 percent of consumers were more interested in a core set of product features at a reasonable price than in the bells and whistles of the latest and greatest technology at a higher price.3 Similarly, in the building-products industry, there is a trend away from premium-priced design features and toward simpler, more basic designs. Understanding this challenging shift in consumer behavior is necessary for companies to compete successfully.4 It represents an opportunity for those that respond quickly and effectively to differentiate themselves from their peers.

Filed under  //   design   innovation   McKinsey   small  
Posted by Niti Bhan 

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