The Carphone Warehouse: Wikis

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The Carphone Warehouse Group PLC
Type Public
Founded 1989
Headquarters London, England, UK
Key people Charles Dunstone, CEO
G. Roux de Bezieux, COO
Roger Taylor, CFO
John Gildersleeve, Chairman
Industry Telecommunications
Products Home and Mobile telephone
equipment and services
Revenue £4,474m (2008)
Operating income £258.3m (2008)
Net income £182m (2008)
Employees 21,380 (2,144 stores)
Subsidiaries TalkTalk
AOL Broadband
Tiscali UK
Opal Telecom
Website cpwplc.com

The Carphone Warehouse Group PLC (LSE: CPW), known as The Carphone Warehouse, is Europe's largest independent mobile phone retailer, with over 1,700 stores across Europe. They are based in the United Kingdom. Outside the UK and the Republic of Ireland, the retailer is named The Phone House.

Contents

History

The company was co-founded in 1989, when most portable phones were too bulky to carry and called car phones, by current CEO Charles Dunstone. Dunstone put £6,000 into the company from his savings, and then called his old school friend and Chartered Accountant David Ross,[1] who agreed to become Finance Director. Based originally in Dunstone's rented flat on the Marylebone Road, London, four years later the company had grown to 20 stores. Now also trading as The Phone House,[2] Carphone Warehouse is Europe's largest independent mobile phone retailer.

While Dunstone became the public face of the Carphone Warehouse, Ross (described by Dunstone as his "secret weapon"),[3] developed and drove the high street retail footprint of the company by buying Tandy in the UK. Dunstone approached old customer Guy Johnson of NEC UK - later described by one City analyst as "the Ringo Starr of Carphone Warehouse" for being in the right place at the right time[4] - to become the third partner, later taking up the role of Logistics and Distribution director.[5]

Ross led the footprint development of the company, under The Phone House brand, across Europe and the United States.[6] When Ross led the IPO of Carphone Warehouse in 2000, it had been so successful that the partners had not needed to borrow or involve outsiders: Dunstone owned half, Ross a third, and Johnson most of the rest.[7]

Only Johnson of the three partners had a family, and having according to media reports becoming less enamoured by the Ross-led European expansion of the organisation,[6] sold the majority of his stake in 2001 and retired with his young family to his holiday home in Portugal.[5]

While Ross had been joint-Chief Operating Officer with Dunstone from 1990 and 2003, whereas Dunstone stayed with the business that he still runs today, Ross started to give up his executive position from 2003.[7] Ross became deputy chairman in July 2005,[8] and by 2008 was a non-executive director. Ross resigned from the board in December 2008 over an issue with shares.[9]

Timeline

Year Month Event
1989 The Carphone Warehouse launched
1994 Carphone Warehouse Insurance launched
1996 First Phone House stores open outside of the UK, in Paris and Dublin
1999 January Acquisition of Tandy (UK only) for £9m[10]
2000 July IPO on main market of London Stock Exchange at a price of GBP£2.00 per share
2001 June Acquisition of Cellcom for £9.1m[11]
2002 Acquired Opal Telecom
2003 TalkTalk brand launched
2004 January Acquisition of e2save for £4.7m[12]
March Acquisition of Xtra in Spain for £11.6m[12]
November TalkTalk Broadband launched
2005 March Acquisition of OneStopPhoneShop for £15m[13]
December Acquisition of Tele2 for £11.5m[13]
Acquisition of One.Tel for £169.6m[13]
2006 April "Free" TalkTalk broadband offer launched[14]
October Acquisition of the access business of AOL UK for £370m[15]
Vodafone switches its contract business to Phones4U[16]
November Launch of a MVNO in Spain under the brand "Happy Móvil"
2007 January Suspension of the Big Brother sponsorship deal.
May Roll out of Geek Squad nationwide.
June Three-year £7million X Factor sponsorship deal signed.[17]
July Carphone Warehouse offers free laptop with AOL Broadband (counter-offer of PC World's free laptop with Orange Broadband deal).
September The Carphone Warehouse joins the FTSE100
2008 May Carphone announces £1.1bn merger with Best Buy

Divisions

Advertisements

TalkTalk

TalkTalk is the home telecommunications branch of The Carphone Warehouse.

Carphone Warehouse also own Opal Telecom, a business to business telecoms provider with a popular switch. It may be construed as a conflict of interest that some of the competitors of TalkTalk such as Toucan (part of IDT Direct Limited), use this switch.

Mobile phone e-tailers

Mobile phone e-tailers e2save, The Phone Spot, Mobiles.co.uk and OneStopPhoneShop are separately managed divisions within Carphone Warehouse. Vanilla mobile fulfillment service is the distribution side of Carphone Warehouse, and is based within e2save.com

Geek Squad

In October 2006 it was announced that Geek Squad would be launching in the UK in a 50/50 joint venture between Carphone Warehouse and Best Buy.[18]

Geek Squad currently offers 24 hour nationwide over-the-phone technology support and in-home technical support in the North-West of England and Greater London with surrounding area.

In 2008 the Carphone Warehouse is increasing its joint venture with Best Buy by launching Best Buy Mobile as a "store inside a store" inside of Best Buy's or as a separate store located by Best Buy stores throughout the United States. The labor will be split between the two companies. In the same business venture Carphone Warehouse was split into four parts (half retail and half broadband) and one quarter sold to Best Buy for a sum nearing 1.1 billion.[19]

Repairs

The Carphone Warehouse has the largest Mobile Phone repair service in the UK, and repair centres in all of the countries it is actively trading in.

Marketing campaigns

Mowbli Jumping small.jpg
Mowbli Logo

In the 1990s Carphone Warehouse became well-known for using the Stereo MCs' "Connected" in its advertisements.

Mowbli, the little mobile phone, is Carphone Warehouse's mascot. He appears mainly in radio advertisements with his friend Ed (voiced by the Irish comedian Ed Byrne), and also on television advertisements. Mowbli was dropped in 2008 and replaced by hand drawn characters and a hand drawn logo to "Bring back its image of Simple Impartial Advice". Mowbli has since been dropped by Carphone Warehouse, and the retailer has returned to the old strapline 'Simple, Impartial Advice'. This reflects the businesses foray into wireless products including laptops, netbooks and games consoles. The retailer has opened up its product offerings from just mobile phones; the decision to ditch Mowbli could be a indication that the retailer is poised to offer an even larger range of consumer electronics.

The X Factor (UK)

As of 19 June 2007, the Carphone Warehouse became the official sponsor of the fourth series of The X Factor. The sponsorship deal stands to last for three years. The Carphone Warehouse will also be the sponsor of its various spin-offs, including The Xtra Factor.[20]

Big Brother (UK)

The company were the sponsors for the UK's version of Big Brother since series 5 in 2004, until 2007. In 2006 they also sponsored Celebrity Big Brother and related Celebrity Big Brother shows on Channel 4.

On 17 January 2007, in response to alleged racism in Celebrity Big Brother, Charles Dunstone said: "We are talking to Channel 4. The sponsorship is constantly under review. Clearly we are against racism. Most people understand that the person who has their name associated with the programme does not necessarily condone the content. [21][22]

On 18 January 2007, Carphone Warehouse announced that it had suspended its sponsorship of the show as Channel 4 had not taken sufficient action in response to the alleged racism in the show.[23]

On 8 March 2007, the company permanently dropped its sponsorship of the show.[24]

Mergers & Acquisitions

AOL UK

AOL Broadband logo (previously AOL UK)

The Carphone Warehouse announced it would purchase the UK business of AOL on 10 October 2006 for £370m.[15][25][26] This makes Carphone Warehouse the 3rd largest broadband provider, with over 2 million customers, and the largest LLU Operator with more than 150,000 LLU customers.[27][28]

The acquisition process completed on 9 December 2006.

It has also been stated in their press release[15] that AOL UK Audience business will remain a separate organization and brand with a revenue sharing agreement. It is not yet clear if the AOL UK Access business (the broadband part) will be fully integrated into Carphone Warehouse, however the name of this business has been changed to AOL Broadband. AOL Broadband customers will not be automatically transferred to Talk Talk.[29]

AOL began consulting on job cuts in 2006. The Times reported that the company expected to cut a total of 500 UK jobs by Christmas.[30] In line with legal requirements, AOL UK (now AOL Broadband) notified the DTI that redundancies are planned. The Press Gazette stated "The company has informed the DTI that it is possible that it will make more than 100 redundancies".[31]

On 1 November 2006, it was made public that Karen Thompson, AOL UK CEO and President AOL Europe, had resigned and had been succeeded by Carlo d'Asaro Biondo (previously CEO of AOL France). Thompson was part of the team responsible for launching AOL UK in 1996.[32]

AOL customers, welcome to the Carphone Warehouse family
I want to reassure you that we have no plans to change the service in any way at all. It will continue to be run by the existing team and will work, look and feel just as it does today. We have entered a long-term deal with Time Warner to keep providing the AOL content and we don't want to mess with what has clearly been a very popular product to date. In the New Year, all AOL customers will be offered the choice of transferring to Free Broadband if they want, by moving their line rental to TalkTalk and signing up for our Talk3 international telephone service. There will be continuity of service with the ability to take your AOL email address to TalkTalk and access to much of the content you previously enjoyed.

Charles Dunstone, 13 November 2006[33]

It was made public on 14 December 2006 that Carlo d'Asaro Biondo had resigned after only six weeks in his new role. Philip Rowley (the chairman of AOL Europe) has taken over on a temporary basis. The Guardian states: the management turmoil has put the European operation in "freefall" and created a "massive vacuum", according to one AOL insider. The same article estimates that 5,000 AOL jobs are to go worldwide (25% of staff) with a significant number from AOL UK.[34]

In January 2007 AOL UK was rebranded as AOL Broadband.

Service changes

In an early press statement, The Carphone Warehouse stated they had "no plans to change the service in any way at all," but, since January, anyone heavily using P2P applications have had their downstream bandwidth limited to 50 kbit/s during peak times (6pm-midnight, Sunday to Thursday).[35]

Marketing offers and problems

During the third quarter of 2007, AOL Broadband caused a stir by offering a free laptop computer (and eventually a free Playstation 3) to all new customers signing up for a 24 month contract with its AOL Broadband Wireless Plus broadband package. While sceptics looked for a catch, industry experts conceded[36] that the offer was reasonable, despite the necessity to sign up to an AOL Talk home phone package in order to be eligible for the free laptop. While an option to not take a bundled home phone package was available, the price increased by £10; further offers include a free Xbox 360, PlayStation 3 and Wii in addition to other promotional items.

Best Buy

On 8 May 2008 Charles Dunstone revealed Carphone Warehouse's biggest move to date: a £1.1bn merger with America's largest electrical retailer, Best Buy.[37] The deal has paved the way for Carphone to split its telecom and retail businesses - a move expected to be completed by March 2010. As part of the detail, a radical new direction has been undertaken for the its retail arm. Big Box out of town stores will be launched to compete with Curry's and Comet, selling electrical goods from TVs to fridges. Meanwhile Carphone's fleet of telecom outlets will be supplemented by new format Wireless World stores targeting connected home entertainment products, laptops and gaming. Investing in such diverse retail distribution is a gamble, but gives The Carphone Warehouse a foothold in businesses with current and future potential.[38]

Tiscali

On May 8 2009, Carphone Warehouse became Britain’s largest broadband provider after it agreed to pay £236m in cash for the UK assets of Tiscali, the Italian telecoms group.

Former competitors

The Carphone Warehouse has acquired four former competitors, mobile phone e-tailers e2save, The Phone Spot, Mobiles.co.uk and OneStopPhoneShop. Orders are fulfilled through the Carphone Warehouse, but each company has its own terms and conditions and, significantly, rules regarding promotions.

Marketing offers and problems

These subsidiaries offered 'cash back' redemption on entering into a contract; customers must send in bills and vouchers to claim back line rental paid to the network. This has proved problematic for many customers.

In the case of the OneStopPhoneShop and e2save customers have had a history of problems in claiming their cash back. OFCOM, the regulator, has admitted receiving many complaints about the behaviour of these two companies but no action has yet been taken.[39]

Data protection

During 2005 TalkTalk's proactive sales techniques drew criticism in the press when it was accused of practising "slamming" to win new customers. [40] Customers who bought mobile phones from Carphone Warehouse retail outlets alleged that their landline accounts were subsequently switched without their consent [41].

On 15 August 2006, the Information Commissioner's Office issued Preliminary Enforcement Notices for breaches of PECR (The Privacy and Electronic Communications Regulations) against Carphone Warehouse and TalkTalk for making marketing calls to people who are signed up to the Telephone Preference Service (TPS) or people who have asked that the company make no further calls to them.[42][43]

On 28 October 2006 in a Times interview Richard Thomas, Britain's Information Commissioner, stated:[44]

We’re taking action against some of the telecom companies, Talk Talk and Carphone Warehouse. We’re taking action against them because we’ve had a lot of complaints that they’ve been telephoning people with marketing calls, people whose name is on the telephone preference service. And then we do these prosecutions, particularly with private detectives. We’ve got a big case coming up.

Standard Operating Platform

On the 22nd June 2009, The Carphone Warehouse launched its 'Standard Operating Platform' named how2, the system was developed in-house on the Nimbus Partners Control 2007 platform. As many as 40 people from across the Retail business contributed to the SOP and helped design, build and document the platform and its processes. The key aim of the programme was to standardise and then improve the way process is documented, then in turn improve the service delivered to Employees who directly deliver service to Customers.

See also

References

  1. ^ "David Ross appointed to board of the National Portrait Gallery". 10 Downing Street. 17 February 2006. Archived from the original on 2007-10-06. http://web.archive.org/web/20071006022644/http://www.pm.gov.uk/output/page9080.asp. Retrieved 2006-11-02.  
  2. ^ The Phone House
  3. ^ "Profile: David Ross". The Guardian. 2008-12-08. http://www.guardian.co.uk/business/2008/dec/09/profile-david-ross. Retrieved 2008-12-08.  
  4. ^ "Founder exits 'back seat' at Carphone Warehouse". The Guardian. 2001-07-13. http://www.guardian.co.uk/business/2001/jul/13/citynews.media. Retrieved 2008-12-14.  
  5. ^ a b "Carphone Warehouse founder quits while he's (£140m) ahead". The Independent. 2001-07-13. http://www.independent.co.uk/news/business/news/carphone-warehouse-founder-quits-while-hes-acircpound140m-ahead-677594.html. Retrieved 2008-12-14.  
  6. ^ a b "Profile: David Ross". The Guardian. 2008-12-08. http://www.guardian.co.uk/business/2008/dec/08/carphonewarehousegroup-telecoms. Retrieved 2008-12-08.  
  7. ^ a b "David Ross: glitz and glamour of the upper-class 'barrow boy' with all the right connections". The Times. 2008-12-09. http://www.timesonline.co.uk/tol/news/uk/article5310334.ece. Retrieved 2008-12-09.  
  8. ^ "Carphone Warehouse co-founder David Ross quits after disclosure failure". The Daily Telegraph. 2008-12-08. http://www.telegraph.co.uk/finance/3681461/Carphone-Warehouse-co-founder-David-Ross-quits-after-disclosure-failure.html. Retrieved 2008-12-08.  
  9. ^ "Carphone Warehouse chief resigns over share disclosure". The Times. 2008-12-08. http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article5305879.ece. Retrieved 2008-12-09.  
  10. ^ "Carphone Warehouse Snaps Up Tandy's Old UK Stores 01/26/99". Newsbytes PM,. 26 January 1999. http://findarticles.com/p/articles/mi_m0HDN/is_1999_Jan_26/ai_53652919. Retrieved 2006-11-05.  
  11. ^ On 13 June 2001, the Group acquired the trade, assets and certain liabilities of Cellcom Limited, a telecoms services business registered in England, for a gross cash consideration of £9.1 m.
    The Carphone Warehouse (2001). [Archive copy at the Internet Archive "Annual Report 2001"]. Press release. Archive copy at the Internet Archive. Retrieved 2006-11-03.  
  12. ^ a b The Carphone Warehouse (2004). "Annual Report 2004". Press release. http://www.cpwplc.com/phoenix.zhtml?c=123964&p=irol-reports. Retrieved 2006-11-03.  
    • "On 1 January 2004, the Group acquired 100% of the issued share capital of E2save.com Limited, a company registered in England, for an initial gross consideration of £1.4 m, with a further contingent deferred consideration of up to £3.3 m payable over two years."
    • "On 8 March 2004, the Group acquired 100% of the issued share capital of Xtra Telecom SA, a fixed line service provider registered in Spain, for an initial gross consideration of £7.5 m, with a further contingent deferred consideration expected to be up to £4.1 m payable over two years. Also the company is known as Crapphone Whorehouse!"
  13. ^ a b c The Carphone Warehouse (2005). "Annual Report 2005". Press release. http://www.cpwplc.com/phoenix.zhtml?c=123964&p=irol-reports. Retrieved 2006-11-04.  
    • "On 1 March 2005, the Group acquired 100% of the issued share capital of One Stop Phone Shop Limited, a company registered in England and Wales that specialises in the mobile ‘off-the-page’ market, for an initial gross cash consideration of £8.3 m, with a further contingent deferred consideration of up to £6.7 m payable over two years."
    • "On 16 December 2005, the Group acquired 100% of the issued share capital of Tele2 UK Communications Limited (Tele2 UK), a company registered in Englandand Wales, for a gross cash consideration of £11.5 m. Tele2 UK is involved in the provision of telecommunications services to residential customers."
    • "On 19 December 2005, the Group acquired 100% of the issued share capital of Centrica Telecommunications Limited, Onetel Limited, Telco Holdings Limited, Awardmodel Limited and their subsidiaries (Onetel), all of which are registered in England and Wales, for a gross cash consideration of £169.6 m. Onetel is involved in the provision of telecommunications services to both residential and business customers."
  14. ^ The Carphone Warehouse (2006-04-11). "Free broadband forever". Press release. http://web.archive.org/web/20070807002109/http://www.talktalk.co.uk/talktalk/servlet/gben-server-PageServer?article=MAIN.UK.TALKTALK.COMPINFO.PRESS.2006.FREE. Retrieved 2006-11-08.  
  15. ^ a b c "Carphone Warehouse to acquire Time Warner's AOL Internet access business in the UK for £370 million". Carphone Warehouse Press Release. 2006-10-11. http://www.google.com/url?sa=t&source=web&ct=res&cd=1&url=http%3A%2F%2Fwww.timewarner.com%2Fcorp%2Fnewsroom%2Fpr%2F0%2C20812%2C1544859%2C00.html&ei=f9_-SaDKEuCrjAeuv5i5Bg&usg=AFQjCNELAzVd6qdbPz6RMdH7d4IGf3ZQ-Q&sig2=ovjgNINLyMk2WJN7GOL2mg. Retrieved 2006-10-27.  
  16. ^ "Vodafone cans Carphone Warehouse". The Register. 2006-10-12. http://www.theregister.co.uk/2006/10/12/vodafone_phones4u_exclusive. Retrieved 2006-11-27.  
  17. ^ "X Factor-y on the high street". thesun.co.uk. 11 July 2007. http://www.thesun.co.uk/article/0,,11050-2007310860,00.html. Retrieved 2007-08-01.  
  18. ^ Durman, P. "Geek Squad comes to Britain", The Sunday Times online. Retrieved on April 4, 2007.
  19. ^ UK’s Carphone Warehouse to Open 1000 Stores in US with Best Buy | PhoneNews.com
  20. ^ "Carphone Warehouse gets the X Factor". MediaGuardian. 2007-06-19. http://media.guardian.co.uk/realitytv/story/0,,2105944,00.html.  
  21. ^ "UK police investigate threats against Big Brother celebs". Ireland on-line. 2007-01-17. http://breakingnews.iol.ie/entertainment/?jp=cwsnmhqlkfcw. Retrieved 2007-01-17.  
  22. ^ Brook, Stephen (2007-01-17). "Big Brother complaints explode". Guardian Unlimited. http://media.guardian.co.uk/site/story/0,,1992246,00.html. Retrieved 2007-01-17.  
  23. ^ "Big Brother sponsor suspends deal". BBC News. 2007-01-18. http://news.bbc.co.uk/1/hi/entertainment/6274881.stm. Retrieved 2007-01-18.  
  24. ^ "Sponsor evicts C4's Big Brother". BBC News. 2007-03-08. http://news.bbc.co.uk/2/hi/entertainment/6429863.stm. Retrieved 2007-03-08.  
  25. ^ "Carphone Warehouse to acquire Time Warner's AOL Internet access business in the UK for £370 million". AOL UK Press Release. 2006-10-11. http://media.aol.co.uk/ukpress_view.cfm?release_num=55254646. Retrieved 2006-10-27.  
  26. ^ "Carphone Warehouse buying AOL UK". BBC News. 2006-10-11. http://news.bbc.co.uk/2/hi/business/6039740.stm. Retrieved 2006-10-11.  
  27. ^ "State of the nation - Local Loop Unbundling". thinkbroadband.com. 2006-10-26. http://www.thinkbroadband.com/news/i/2842.html. Retrieved 2006-10-28.  
  28. ^ The exact figure for LLU customers is not in the public domain, hence 150,000 is the estimated minimum. "Carphone Warehouse with 421,000 live broadband users". thinkbroadband.com. 2006-10-26. http://www.thinkbroadband.com/news/i/2813.html. Retrieved 2006-10-31.  
  29. ^ "AOL broadband customers face dilemma after Talk Talk takeover". The Sunday Times. 2006-10-15. http://technology.timesonline.co.uk/article/0,,20411-2403994,00.html. Retrieved 2006-11-01.  
  30. ^ "AOL staff cuts follow its sale to Carphone Warehouse". The Times. 2006-10-12. http://business.timesonline.co.uk/article/0,,9076-2400252.html. Retrieved 2006-11-03.  
  31. ^ "Journalists fear cuts at AOL". The Press Gazette. 2006-11-01. Archived from the original on 2007-11-13. http://web.archive.org/web/20071113105400/http://www.pressgazette.co.uk/article/011106/aol_strike_threat. Retrieved 2006-11-07.  
  32. ^ "AOL Europe gets new head". The Register. 2006-11-01. http://www.theregister.co.uk/2006/11/01/aol_europe_new_president. Retrieved 2006-11-01.  
  33. ^ Charles' Blog
  34. ^ "AOL Europe loses another chief". The Guardian. 2006-12-14. http://business.guardian.co.uk/story/0,,1972196,00.html. Retrieved 2006-12-15.  
  35. ^ "How will I know if I exceed what is deemed acceptable usage?". AOL UK. http://help.aol.co.uk/how-will-i-know-if-i/article/20070129060009990011?n=collection&p=At%20what%20usage%20level%20would%20the%20fair%20use%20policy%20be%20applied?%20help_portal&c=help_portal. Retrieved 2007-04-20.  
  36. ^ "Is the AOL free laptop offer any good?". ChooseISP.co.uk. http://www.chooseisp.co.uk/broadband-guide/news/free-laptops-for-aol-subscribers.html. Retrieved 2007-10-15.  
  37. ^ "Dunstone’s biggest deal launches Carphone into Wireless World". mobiletoday.co.uk. http://www.mobiletoday.co.uk/news.aspx?id=35192. Retrieved 2008-05-14.  
  38. ^ "Carphone's strong points". mobiletoday.co.uk. http://www.mobiletoday.co.uk/Carphone_strengths_in_the_market.html. Retrieved 2008-11-26.  
  39. ^ "Problems with One Stop Phone Shop". Consumer Deals. http://www.consumerdeals.co.uk/onestopphoneshop.html. Retrieved 2006-11-13.  
  40. ^ "Phone scam hits thousands". Daily Mail. 2005-04-25. http://www.thisismoney.co.uk/news/article.html?in_article_id=399990&in_page_id=2. Retrieved 2007-03-19.  
  41. ^ "When slamming the phone prompts a row". The Guardian. 2005-04-23. http://money.guardian.co.uk/phones/story/0,13283,1466811,00.html. Retrieved 2007-03-19.  
  42. ^ "Preliminary Enforcement Notices" (pdf). ICO. http://www.ico.gov.uk/upload/documents/library/privacy_and_electronic/notices/pecr_enforcement_notice.pdf. Retrieved 2006-11-13.  
  43. ^ "Statutory Instrument 2003 No. 2426 The Privacy and Electronic Communications (EC Directive) Regulations 2003". Office of Public Sector Information. http://www.opsi.gov.uk/si/si2003/20032426.htm. Retrieved 2006-11-13.  
  44. ^ "Full text of the interview with Richard Thomas". The Times. 2006-10-28. http://www.timesonline.co.uk/article/0,,2-2425085,00.html. Retrieved 2006-11-13.  

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