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NASCAR nears a new media rights deal but a simmering dispute with teams over revenue has complicated matters



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When senior team executives in NASCAR filed into a Team Owner Council meeting this month, they were struck to find both Jim France and Lesa France Kennedy there. France, the chairman and CEO of NASCAR, often attends the quarterly meetings of the council that was founded in 2016, but France Kennedy’s attendance is more rare. France Kennedy is the executive vice chair of NASCAR and niece of France, whose father founded the sport in 1948.

Their combined attendance came on the heels of a tumultuous last six months that included the teams infuriating NASCAR’s brass by going public with a dispute over revenue sharing. The strained talks turned some relationships frosty between NASCAR executives and team leaders.


While France Kennedy was in Charlotte in part for the NASCAR Hall of Fame ceremony, the fact that both showed up at the first major meeting between the teams and NASCAR  this year shows that NASCAR’s ownership remains engaged toward striking a new revenue-sharing deal with the teams, sources say. Such a deal would effectively bring labor peace through the duration of the next media rights agreement, which could run near or past the end of this decade.

NASCAR is celebrating its 75th anniversary season this year, and whether and how the tenuous situation is resolved could affect NASCAR until its 100th.

At issue is that teams want to get more money annually from the league, saying they face a major struggle to turn a profit. The largest revenue stream in NASCAR is the $8.2 billion, 10-year media rights agreement with Fox Sports and NBC Sports that started in 2015 and expires after 2024. NASCAR could try to hash out a deal with teams after it strikes the new media rights agreement, sources say, but instead it plans to negotiate with teams as media talks advance. Teams do get other monies,  but the TV revenue is by far the largest stream, sources said.

In the current TV agreement, tracks take in 65% of traditional media revenue, while 25% goes to teams and 10% to the sanctioning body. Via the sport’s governing charter system, teams earn as much as about $8 million to $10 million per car, per year, from the league if they are the sport’s best performers, while poorly performing teams sometimes earn around half that. But teams say it can cost around $18 million for the top performers to run the annual operations of a single car, and the rest needs to be supplemented by ever-scarcer corporate sponsorship.

Under the next deal, teams want a greater percentage of league funds to cover their expenses, asking for upward of $16 milion-$18 million annually, or roughly double the current amount for the best performers. That could give them a better chance to turn a profit if they get enough corporate sponsorship and run a lean operation.

NASCAR has acknowledged that teams deserve more money but has been resistant to the demands. Still, sources say the sanctioning body has seemingly started to soften in recent weeks to the idea of finding an agreement.

In the meantime, teams have started to try to build leverage, such as acknowledging that they’re considering staging offseason exhibition races to supplement their usual income.

“The best deals are ones when everyone feels a little bit of pain, and a bad business deal is when one side feels they got a better deal than the person at the other end of the table,” said Jeremy Lange, the former president of defunct NASCAR team Leavine Family Racing, who now is the co-founder and partner of The Surge Connection marketing agency. “You want both sides feeling like they could have gotten more but are happy with what they got, and I’m not sure they’re there yet.”

For all the talks going on, NASCAR Chairman Jim France is seen as the one with ultimate authority on when it gets done.getty images

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For years, NASCAR teams have privately complained that they deserve more league revenue, particularly as sponsorship became tougher to come by after the 2008 recession and as NASCAR’s key performance indicators slipped from their heady peaks. What’s changed from the last TV cycle until this deal is that teams have rallied around a more unified voice. That’s because the Race Team Alliance was founded in mid-2014, not long after the last 10-year media deal was negotiated. The RTA membership consists of 16 teams, which field 36 cars (one charter for each car) in the premier Cup Series.

Teams also have a better sense of NASCAR’s finances. When NASCAR took track owner and operator International Speedway Corp. private in 2019, the sanctioning body had to release sensitive financial information that teams pored through. Teams have then taken that information and shared key takeaways publicly to make clear that they believe they’re getting a raw deal. They claim that NASCAR’s assets make up 93% of the value of the sport, while teams’ assets are only worth 7%. That’s based on an assumption that the entire sport’s assets could be valued at $10 billion combined, while the 36 car charters are worth $20 million each, or $720 million. This is where teams see the opportunity share in the overall revenue pot.

In 2023, teams are due to receive around $201 million in TV money and around $210 million in 2024, according to information seen by Sports Business Journal. Based on comments that NASCAR has made to teams recently, teams believe that NASCAR has a solid idea of how much increased revenue it stands to make in the next media cycle.

23XI investor Curtis Polk is seen as a disrupter in the talks.23XI Racing

The financial statistics gathered by the teams seemed to have caught the eye of, among others, Michael Jordan and his right-hand man, Curtis Polk, as they invested in the sport in 2020 by founding 23XI Racing with Denny Hamlin. Polk first sent a signal to the industry last February when he told SBJ that NASCAR “is a sleeping giant, but from the team ownership side it’s very sponsor dependent and we need to address that model.”

Polk has been seen during these talks as a ring leader of sorts for the teams. In one meeting, he compared the overall revenue splits in NASCAR to other sports, particularly the NBA. As basketball-related income, the NBA’s national media rights revenue — some $2.6 billion of the league’s $10 billion-plus overall revenue — is divided between league owners and players in a roughly 50-50 split.

Hamlin raised eyebrows further in May when he suggested that until he and his business partners saw a change in NASCAR’s business model, all further major investments in the team — including a new headquarters — were on hold. The team has since decided to move forward with breaking ground on its new headquarters in the hopes that the talks will be successful, though it could still pivot if they fail.

In a meeting with media last fall to discuss the dispute, Polk called NASCAR a “money-printing machine” before adding: “But the teams and drivers are putting on the show.” That theme is one that has become central to the teams’ messaging during the current negotiations — that the teams and drivers are the talent and show and should be compensated far higher commensurately.

Ty Norris, president of Trackhouse Racing, echoed that sentiment in early October that the teams had just been a “recipient of whatever NASCAR brought to the teams, but in this round, the teams are wanting to position themselves to receive what we believe is the value of the show. We are the show.”

Teams say the sport has long relied too heavily on sponsorships.getty images

Teams’ concern about the financial model was heightened after last season’s debut of the seventh-generation car, dubbed the Next Gen. Before last year, traditional garage logic had that it cost around $20 million to run a top-flight car every year, but that was supposed to drop to around $12 million with the new version by forcing teams to buy more parts from a single source. Previously they could research and develop a greater number of their own parts, sparking an expensive arms race.

The new car was projected to be far cheaper, but that was before global inflation, supply-chain problems and issues specific to the car arose in 2022 and left top teams paying close to 50% more than original projections, or around $18 million for top teams, sources say. The envisioned savings didn’t materialize, at least last year, though NASCAR did help subsidize some of the additional costs.

The fact that teams can only earn up to $10 million in league revenue at best for operations that can cost closer to $20 million means that they have long had to rely on sponsorships or other forms of money for more than half of their annual total revenue, with some teams putting their annual sponsorship percentage closer to 75%, an exceedingly unrealistic target.

NASCAR argues that teams could run more efficient operations to cut costs, though teams say that would simply mean mass layoffs. The top teams are known to spend heavily to find an advantage, something NASCAR executives have long bemoaned as contributing to what they perceive as an over-spending problem. The notion, shared by others in the industry including some track executives, is that teams are their own worst enemies, constantly spending beyond their means. Without changed habits, those skeptics say, some teams will remain under financial duress, even with a new revenue model. To get an agreement, team executives have emphasized that they’re willing to examine all costs, revenue and budget ideas, including a spending cap and possible tax system if teams go over the cap.

SBJ contacted multiple track executives to ask about the talks but many declined or spoke only on background, noting that these negotiations are technically between the sanctioning body and the teams. Tracks contend that they need their revenue slice because of the high cost of developing and maintaining the facilities, which have to seek alternative forms of revenue the bulk of the year when they don’t have NASCAR events.

LFR, the defunct team that Lange was president of, earned around $6 million in league revenue in 2020, its final year before folding, after finishing 20th in points, which is roughly mid-pack out of 36 charters. Lange said that if league funds could cover two-thirds of annual performance costs instead of one-third, his team might still be in business. LFR, which owned a charter, left the sport after the 2020 season after years of trouble making the owner model work.

“We were staring at one-third [covered by league funds] and two-thirds [where sponsorship was needed]. If it was [the other way around], I think they could have stomached that potentially,” Lange said of the former team owners. “The [New York] Mets aren’t signing all these guys because they’re going to get more [sponsorship] money from Citibank – it’s based off the TV deal.”

Skeptics say teams are their own worst enemy by spending too much to gain an advantage on the track.getty images

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After Polk and Hamlin made their public waves in the early part of last year, teams largely went silent on the topic as they started working behind the scenes. They created a sub-committee to negotiate with NASCAR and put together a seven-point proposal to send to the sanctioning body about what they want in the next deal.

The sub-committee was made up of Polk, Hendrick Motorsports Vice Chairman Jeff Gordon, Joe Gibbs Racing President Dave Alpern and Roush Fenway Keselowski Racing President Steve Newmark. On NASCAR’s side of the negotiating table has been President Steve Phelps, COO Steve O’Donnell, Executive Vice President and Chief Legal Counsel Garry Crotty and Senior Vice President, Racing Development and Strategy Ben Kennedy.

Meanwhile, while NASCAR deal-making has long been based on relationships, sources stress these team leaders have been empowered to make difficult decisions about their future, keeping longtime team owners like Rick Hendrick and Roger Penske at arm’s length, for now, from NASCAR.

As summer turned to fall, teams grew frustrated when they didn’t get a response from NASCAR to the proposal that they had sent over in June. That led them to schedule the early-October meeting with a group of media in Charlotte before a playoff race weekend to publicly confirm that the sides were at loggerheads.

The impromptu news conference featured rarely seen candor in the typically private sport about the financial struggles of being a NASCAR team. For example, Joe Gibbs has always been known as a master salesperson with sponsors but he does not own any outside business empires that could subsidize the team, and JGR’s Alpern at the meeting called himself “terrified of what happens after Coach [Joe Gibbs] is gone – I’m talking about survival.”

The RTA also began consulting with Wasserman  to assess the value of team rights and other strategic alternatives; around the same time, NASCAR started consulting with CAA subsidiary Evolution Media Capital while also maintaining a relationship with Sports Media Advisors, with whom the league had worked on its prior media cycle.

Talks between the teams and NASCAR stalled in the ensuing months after teams went public. Teams believe that their public move didn’t backfire, but it didn’t advance negotiations either, and some executives from other parts of the industry have questioned whether the move was wise.

Still, talks have since picked back up in recent weeks, sources say, raising hopes that a deal could eventually be made.

Asked how confident it was that it will come to an agreement with its teams, NASCAR told SBJ in a statement: “We have a 75-year track record of being good partners and working hard to understand the priorities and needs of the many stakeholders in our sport. We are confident our industry will continue to work together to build on the momentum from our historic 2022 season and drive long-term growth for our sport, stakeholders and fans.”

As for the RTA, it declined comment. But Newmark told this month: “There is a model that works for everybody which actually helps take the sport to the next level. There’s just a lot of pieces and we have to figure out how to get there. The reason I have so much optimism that we can get a deal done is because the sport is growing. If we were in the situation like five years ago where the sport was stagnated, it might be more difficult to come up with a whole new paradigm.”

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That new paradigm is more than just money. One other major sticking point for teams is they want to make the charter system permanent. There’s also been chatter that drivers could eventually try to negotiate for retirement pensions.

The charter system, NASCAR’s version of franchising, was introduced in 2016 in a nine-year deal set to end in 2024 concurrent to the TV deal so that the sides could re-evaluate how it was working. Charters are now worth eight figures and rising in value, and teams believe it’s only natural to turn the system into a permanent one.

If there is to be a revenue deal with teams, one of the major avenues toward progress will likely be through the potential swapping of ancillary rights and agreements. For example, in exchange for granting teams more annual revenue, NASCAR will likely want teams to agree to some form of a spending cap and could seek additional digital and content rights from teams or time commitments from drivers for marketing purposes. Teams have also offered to approach sponsorship in a new, more unified way, versus the cutthroat, dog-eat-dog world of NASCAR team sponsorship that currently exists.

But for all the technical negotiating going on between the team presidents and NASCAR executives, some feel that the deal ultimately is going to get made between Jim France and NASCAR’s old-guard owners such as Hendrick, Penske and Gibbs. That’s why France and France Kennedy’s combined attendance at the team owner council meeting this month was seen as an important indicator.

The revenue split is only one of two negotiations NASCAR is facing this year but it could be the harder of the two, because when it comes to negotiating the deal with media companies, NASCAR and its advisers say they like their hand. The sport has continued to hold its own in a crowded sports media landscape, finishing the 2022 Cup Series season up 4% in viewership from 2021 to an average of 3.04 million.

Led by NASCAR’s Phelps, there has been a new sense of experimentation in the sport, with its first stadium race, held last year at the L.A. Coliseum, and finalized plans for its first street circuit race, set for this summer in Chicago. Moreover, to show it isn’t abandoning its past, NASCAR will take its All-Star Race back to North Carolina’s historic North Wilkesboro Speedway this year as part of its 75th anniversary.

“We are extremely bullish on NASCAR,” said Alan Gold, partner and head of sports media at Evolution Media Capital. “Their audience is a massive, passionate fan base that consistently tunes in week after week. With viewership up year-over-year, and NASCAR’s continued innovation both on and off the track, there is tremendous momentum heading into their rights discussions.”

Lange summed up how important it is that NASCAR and the teams eventually come to terms.

“They depend on each other, and with this deal, they both have much to gain — and just as much to lose —  depending on how well they work together.”


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Utah’s ambitious social media law



Utah’s sweeping social media legislation passed this week is an ambitious attempt to shield children and teens from the ill effects of social media and empower parents to decide whether their kids should be using apps like TikTok or Instagram.

What’s not clear is if — and how — the new rules can be enforced and whether they will create unintended consequences for kids and teens already coping with a mental health crisis. And while parental rights are a central theme of Utah’s new laws, experts point out that the rights of parents and the best interests of children are not always aligned.

For instance, allowing parents to read their kids’ private messages may be harmful to some children, and age verification requirements could give tech companies access to kids’ personal information, including biometric data, if they use tools such as facial recognition to check ages.

“Children may be put at increased risk if these laws are enforced in such a way that they’re not allowed to some privacy, if they are not allowed some ability for freedom of speech or autonomy,” said Kris Perry, executive director of the nonprofit Children and Screens: Institute of Digital Media and Child Development.


The laws, which will go into effect in a year, impose a digital curfew on people under 18, require minors to get parental consent to sign up for social media apps and force companies to verify the ages of all their Utah users. They also require tech companies to give parents access to their kids’ accounts and private messages, which has raised alarms for child advocates who say this could further harm children’s mental health by depriving them of their right to privacy. This is especially true for LGBTQ2S+ kids whose parents are not accepting of their identity.

The rules could drastically transform how people in this conservative state access social media and the internet, and if successful, serve as a model for other states to enact similar legislation. But even if the laws clear the inevitable lawsuits from tech giants, it’s not clear how Utah will be able to enforce them.

Take age verification, for instance. Various measures exist that can verify a person’s age online. Someone could upload a government ID, consent to the use facial recognition software to prove they are the age they say they are.

“Some of these verification measures are wonderful, but then also require the collection of sensitive data. And those can pose new risks, especially for marginalized youth,” Perry said. “And it also puts a new kind of burden on parents to monitor their children. These things seem simple and straightforward on their face, but in reality, there are new risks that may emerge in terms of that that collection of additional data on children.”

Just as teens have managed to obtain fake IDs to drink, they are also savvy at skirting online age regulations.

“In Southeast Asia they’ve been trying this for years, for decades, and kids always get around it,” said Gaia Bernstein, author of “Unwired,” a book on how to fight technology addiction.

The problem, she said, is that the Utah rules don’t require social networks to prevent kids from going online. Instead, they are making the parents responsible.

“I think that’s going to be the weak link in the whole thing, because kids drive their parents insane,” Bernstein said.

There is no precedent in the United States for such drastic regulation of social media, although several states have similar rules in the works.

On the federal level, companies are already prohibited from collecting data on children under 13 without parental consent under the Children’s Online Privacy Protection Act. For this reason, social media platforms already ban kids under 13 from signing up to their sites — but children can easily skirt the rules, both with and without their parents’ consent.

Perry suggests that instead of age verification, there are steps tech companies could take to make their platforms less harmful, less addictive, across the board. For instance, Instagram and TikTok could slow down all users’ ability to mindlessly scroll on their platforms for hours on end.

The laws are the latest effort from Utah lawmakers focused on children and the information they can access online. Two years ago, Gov. Spencer Cox signed legislation that called on tech companies to automatically block porn on cell phones and tablets sold, citing the dangers it posed to children. Amid concerns about enforcement, lawmakers in the deeply religious state revised the bill to prevent it from taking effect unless five other states passed similar laws — which has not happened.

Still, child development experts are generally hopeful about the growing push to regulate social media and its effects on children.

“Children have specific developmental needs, and we want to protect them at the same time that we’re trying to push back on Big Tech,” Perry said. “It’s a two-part effort. You have to really put your arm around the kids while you’re pushing Big Tech away.”


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Trans Flight Attendant Famed For United Airlines Ad Found Dead After Emotional Social Media Post





Trans Flight Attendant Famed For United Airlines Ad Found Dead After Emotional Social Media Post

The Denver Police Department is investigating Scott’s death.

Kayleigh Scott, a transgender flight attendant who gained fame after appearing in a United Airlines commercial, has died after posting an emotional note to her social media channels. According to The Independent, the 25-year-old was found dead on Monday in her Colorado home. In her Instagram and Facebook posts, she penned a heartbreaking letter to her friends and family that asked them to remember the “good memories we have shared”.


“As I take my final breaths and exit this living earth, I would like to apologize to everyone I let down,” Scott wrote. “I am so sorry I could not be better. To those that I love, I am sorry I could not be stronger. To those that gave me their everything, I am sorry my effort was not reciprocated. Please understand that me leaving is not a reflection on you, but the result of my own inability to turn myself for the better,” the flight attendant added.

In her post, Scott also named a few of her loved ones and apologised saying, “I will see you all again on the other side”.

Scott’s mother, Andrea Sylvestro, confirmed her daughter died after posting the letter. In a Facebook post, Ms Sylvestro wrote, “Kayleigh Scott…I am so unbelievably proud to have you as my daughter, proud and amazed by everything that you have done in your life, your smile was absolutely beautiful, your laughter was unbelievably contagious, your heart was bigger than any of us could have ever understood.”

As per The Independent, the Denver Police Department is now investigating Scott’s death. The cops stated that a final determination as to the cause of death will be made by the Denver Medical Examiner’s office.

Separately, United Airlines said it was saddened by the loss of Scott. “We are incredibly saddened by the tragic loss of Kayleigh Scott and extend our deepest condolences to her family, friends and coworkers,” the company stated.

Notably, Kayleigh Scott made headlines in 2020 when United featured her as a part of its diversity campaign. In the clip for Trans Day of Visibility, she spoke about the importance of coming out and living authentically. “I used to be so embarrassed about being trans,” she said, adding, “All I wanted was to blend in.”

The following year, Ms Scott also spoke about her progress since publicly coming out as transgender. She had alluded to battling depression. ” I’m really struggling to find happiness and hope. I’m begging 2023 to be better to me. Please,” she wrote, as per the outlet.


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Utah social media law means kids need approval from parents




Children and teens in Utah would lose access to social media apps such as TikTok if they don’t have parental consent and face other restrictions under a first-in-the-nation law designed to shield young people from the addictive platforms.

Two laws signed by Republican Gov. Spencer Cox Thursday prohibit kids under 18 from using social media between the hours of 10:30 p.m. and 6:30 a.m., require age verification for anyone who wants to use social media in the state and open the door to lawsuits on behalf of children claiming social media harmed them. Collectively, they seek to prevent children from being lured to apps by addictive features and from having ads promoted to them.

The companies are expected to sue before the laws take effect in March 2024.


The crusade against social media in Utah’s Republican-supermajority Legislature is the latest reflection of how politicians’ perceptions of technology companies has changed, including among typically pro-business Republicans.

Tech giants like Facebook and Google have enjoyed unbridled growth for over a decade, but amid concerns over user privacy, hate speech, misinformation and harmful effects on teens’ mental health, lawmakers have made Big Tech attacks a rallying cry on the campaign trail and begun trying to rein them in once in office. Utah’s law was signed on the same day TikTok’s CEO testified before Congress about, among other things, the platform’s effects on teenagers’ mental health.

But legislation has stalled on the federal level, pushing states to step in.

Outside of Utah, lawmakers in red states including Arkansas, Texas, Ohio and Louisiana and blue states including New Jersey are advancing similar proposals. California, meanwhile, enacted a law last year requiring tech companies to put kids’ safety first by barring them from profiling children or using personal information in ways that could harm children physically or mentally.

The new Utah laws also require that parents be given access to their child’s accounts. They outline rules for people who want to sue over harms they claim the apps cause. If implemented, lawsuits against social media companies involving kids under 16 will shift the burden of proof and require social media companies show their products weren’t harmful — not the other way around.

Social media companies could have to design new features to comply with parts of the laws that prohibit promoting ads to minors and showing them in search results. Tech companies like TikTok, Snapchat and Meta, which owns Facebook and Instagram, make most of their money by targeting advertising to their users.

The wave of legislation and its focus on age verification has garnered pushback from technology companies as well as digital privacy groups known for blasting their data collection practices.

The Electronic Frontier Foundation earlier this month demanded Cox veto the Utah legislation, saying time limits and age verification would infringe on teens’ rights to free speech and privacy. Moreover, verifying every users’ age would empower social media platforms with more data, like the government-issued identification required, they said.

If the law is implemented, the digital privacy advocacy group said in a statement, “the majority of young Utahns will find themselves effectively locked out of much of the web.”

Tech industry lobbyists decried the laws as unconstitutional, saying they infringe on people’s right to exercise the First Amendment online.

“Utah will soon require online services to collect sensitive information about teens and families, not only to verify ages, but to verify parental relationships, like government-issued IDs and birth certificates, putting their private data at risk of breach,” said Nicole Saad Bembridge, an associate director at NetChoice, a tech lobby group.

What’s not clear in Utah’s new law and those under consideration elsewhere is how states plan to enforce the new regulations. Companies are already prohibited from collecting data on children under 13 without parental consent under the federal Children’s Online Privacy Protection Act. To comply, social media companies already ban kids under 13 from signing up to their platforms — but children have been shown to easily get around the bans, both with and without their parents’ consent.

Cox said studies have shown that time spent on social media leads to “poor mental health outcomes” for children.

“We remain very optimistic that we will be able to pass not just here in the state of Utah but across the country legislation that significantly changes the relationship of our children with these very destructive social media apps,” he said.

The set of laws won support from parents groups and child advocates, who generally welcomed them, with some caveats. Common Sense Media, a nonprofit focused on kids and technology, hailed the effort to rein in social media’s addictive features and set rules for litigation, with its CEO saying it “adds momentum for other states to hold social media companies accountable to ensure kids across the country are protected online.”

However, Jim Steyer, the CEO and founder of Common Sense, said giving parents access to children’s social media posts would “deprive kids of the online privacy protections we advocate for.” Age verification and parental consent may hamper kids who want to create accounts on certain platforms, but does little to stop companies from harvesting their data once they’re on, Steyer said.

The laws are the latest effort from Utah lawmakers focused on the fragility of children in the digital age. Two years ago, Cox signed legislation that called on tech companies to automatically block porn on cellphones and tablets sold in the state, after arguments about the dangers it posed to children found resonance among Utah lawmakers, the majority of whom are members of The Church of Jesus Christ of Latter-day Saints. Amid concerns about enforcement, lawmakers ultimately revised that legislation to prevent it from taking effect unless five other states passed similar laws.

The regulations come as parents and lawmakers are growing increasingly concerned about kids and teenagers’ social media use and how platforms like TikTok, Instagram and others are affecting young people’s mental health. The dangers of social media to children is also emerging as a focus for trial lawyers, with addiction lawsuits being filed thorughout the country.


Ortutay reported from Oakland, California.


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