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Salary Cap Expected to Go Up?

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Old
11-03-2010, 11:33 AM
  #51
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Originally Posted by Flyskippy View Post
The thing is (as you say in your 2nd paragraph) that the circumstances that led to those teams' resurgence is coincidental to - and not because of - the new (post-2005) CBA. That's my point. The Penguins staying in Pittsburgh also has the new building to thank.
Winning always brings fans in Pittsburgh. Unlike Philly, losing means an empty building.
I understood everything until the bold, and then you blew my mind. What exactly are you talking about?

Are you saying, "Winning always brings fans in Pittsburgh, and unlike in Philly, losing means an empty building."?

Not nitpicking about grammar here, your context is just so hard to get in that last part.


Also, you're absolutely right that the cap has done nothing to help problem teams necessarily grow their way out of age-old slumps in the sense that it hasn't sent high-end free agent in search of bigger dollars down to the small market teams that can't even afford them. That has been drafting and management, but then again I view that as a good thing. Why should an organization be rewarded for incompetent management unless they get really lucky (see: Pittsburgh/Chicago). Even then, those lucky teams shouldn't necessarily be rewarded, but that's what happens when you get lucky. There are other teams working their way out of that issue right now like Toronto, Tampa, and LA with smart management along with some solid drafts.

That said, what a salary cap does is keep the bar low enough for smaller market teams to compete at least a little.

The salary cap, since it is based on revenue, is a great benchmark for how the league is doing as a whole. The league is gaining steam, and these small markets can only benefit from that.

The amount of benefit they get is how successful they manage to be though. I'm sure the Lightning are now finally turning things around a bit financially. I'd be surprised if they weren't thanks to a legitimate management and some excitement.

All the cap means is that they will be competitive sooner. The salary cap puts a speed-up on the rebuild process and brings a swifter guillotine into lottery picks.

Honestly, I'm okay with it. Soon it'll be time for these other teams to rise up. They won't be at the league basement forever.

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11-03-2010, 11:35 AM
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Originally Posted by Jester View Post
Ticket prices have NOTHING to do with the CBA, and I would love to see a quote of them ever promising that (because that was a flat lie). Ticket prices are supply-demand economics in its purest form. If there is high demand for tickets, then the ticket prices should go up... if there's low demand, they should go down.
Still chewing over the rest of your post, but I can respond quickly to this.

Quote:
At the 2004 All-Star Game, Bettman was asked if he really had said teams selling out would drop their ticket prices if the league attained its coveted "cost certainty."

"What I said was it varies from market to market," he responded. "The one thing that would not be sensible to do is lower your ticket prices to enrich scalpers. That doesn't make any sense. But the fact of the matter is, more than a majority of our teams would use the opportunity of economic stability to lower their ticket prices."

That didn't happen.
From here (due to work blockages, I have to used cached pages often):
http://webcache.googleusercontent.co...ient=firefox-a


Last edited by Flyskippy: 11-03-2010 at 11:39 AM. Reason: Hit [IMG] instead of [URL]
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11-03-2010, 11:38 AM
  #53
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Originally Posted by Chris Shafer View Post
I understood everything until the bold, and then you blew my mind. What exactly are you talking about?
Uh.. Yeah. I rushed that.

Quote:
Are you saying, "Winning always brings fans in Pittsburgh, and unlike in Philly, losing means an empty building."?

Not nitpicking about grammar here, your context is just so hard to get in that last part.
I meant that win or lose, fans show up in Philly. Pens fans were fairweather (attendance soared in the early 90's and plummeted afterward, then again rose after 2005). They have yet to prove otherwise, but if the Pens falter again, they will have a chance to do so.

Quote:
Also, you're absolutely right that the cap has done nothing to help problem teams necessarily grow their way out of age-old slumps in the sense that it hasn't sent high-end free agent in search of bigger dollars down to the small market teams that can't even afford them. That has been drafting and management, but then again I view that as a good thing. Why should an organization be rewarded for incompetent management unless they get really lucky (see: Pittsburgh/Chicago). Even then, those lucky teams shouldn't necessarily be rewarded, but that's what happens when you get lucky. There are other teams working their way out of that issue right now like Toronto, Tampa, and LA with smart management along with some solid drafts.

That said, what a salary cap does is keep the bar low enough for smaller market teams to compete at least a little.

The salary cap, since it is based on revenue, is a great benchmark for how the league is doing as a whole. The league is gaining steam, and these small markets can only benefit from that.

The amount of benefit they get is how successful they manage to be though. I'm sure the Lightning are now finally turning things around a bit financially. I'd be surprised if they weren't thanks to a legitimate management and some excitement.

All the cap means is that they will be competitive sooner. The salary cap puts a speed-up on the rebuild process and brings a swifter guillotine into lottery picks.

Honestly, I'm okay with it. Soon it'll be time for these other teams to rise up. They won't be at the league basement forever.
I feel I might be radiating more heat than light, so I'll get off this thread for a bit. It just infuriates me that teams that aren't viable are the ones the league tries to prop up as opposed to move to viable markets.

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11-03-2010, 11:39 AM
  #54
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Originally Posted by Jester View Post
Ticket prices have NOTHING to do with the CBA, and I would love to see a quote of them ever promising that (because that was a flat lie). Ticket prices are supply-demand economics in its purest form. If there is high demand for tickets, then the ticket prices should go up... if there's low demand, they should go down.
Correct nothing to do with the cba, however bettmen absolutely said ticket prices would be reduced. Not going to bother looking for it as it was said. With the cost certainty the product was supposed to be made more affordable we were told. I agree with you that it was a flat out lie and anyone who believed it is a clown. I think the first year my tickets were reduced by 2 bucks or something. They will gauge you anyway they can. With all the empty seats at the games they are losing out on so much revenue. I would really like for once to see what the actual attendance is as compared to what tickets were sold. There are thousands of empty seats.

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11-03-2010, 11:44 AM
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Originally Posted by Chris Shafer View Post
The salary cap, since it is based on revenue, is a great benchmark for how the league is doing as a whole. The league is gaining steam, and these small markets can only benefit from that.
Not really, as if say 8 teams are carrying the league, how is that good? While other teams add no value to the bottom line and are losing money.

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11-03-2010, 11:44 AM
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Originally Posted by NWO View Post
Correct nothing to do with the cba, however bettmen absolutely said ticket prices would be reduced. Not going to bother looking for it as it was said. With the cost certainty the product was supposed to be made more affordable we were told. I agree with you that it was a flat out lie and anyone who believed it is a clown. I think the first year my tickets were reduced by 2 bucks or something. They will gauge you anyway they can. With all the empty seats at the games they are losing out on so much revenue. I would really like for once to see what the actual attendance is as compared to what tickets were sold. There are thousands of empty seats.
Yeah, it's quoted above. Couple of points.

1) Bettman has ZERO control over ticket prices... so he probably should not have even answered the question.

2) Notice all the weasel words in that quote. I mean, "What I said was it varies from market to market" is just awesome. Cuz, yes, it varies from market to market as the different markets figure out what is best for them economically.

I'm sure they expected the majority to lower tickets, but they're not going to keep tickets artificially low and leave money on the table. It's a business.

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11-03-2010, 11:46 AM
  #57
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Originally Posted by Flyskippy View Post
I feel I might be radiating more heat than light, so I'll get off this thread for a bit. It just infuriates me that teams that aren't viable are the ones the league tries to prop up as opposed to move to viable markets.
I read somewhere that teams like Phoenix only exist to cover a section of the US population that would otherwise be uncovered by any NHL organization.

This is not something that's necessarily important to the competitiveness as a league in general, since a small market team like Phoenix is going to have a hard time getting fans in that desolate wasteland and fans = revenue to attract more NHLers.

That said, because Phoenix is covering that population whereas a team elsewhere would not, it's much easier to sell a national broadcast covering the NHL to companies that would televise NHL games nationally.

In theory, Phoenix does more for us draining money from our excess revenue than a second team in Toronto would, just because Phoenix does a lot for getting us those Winter Classics and the possible upcoming ESPN contract once Versus is over with.

I'm not sure of the details, but that's what I understood from the limited amount that I read on this subject.

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Originally Posted by NWO View Post
Not really, as if say 8 teams are carrying the league, how is that good? While other teams add no value to the bottom line and are losing money.
As of 11.11.09.

TEAM - DEBT - REVENUE - OPERATING INCOME
01. Maple Leafs - 31% - 168.00m - +78.90m
02. Canadiens - 71% - 130.00m - +31.30m
03. Rangers - 00% - 139.00m - +27.70m
04. Red Wings - 00% - 130.00m - +27.40m
05. Blackhawks - 00% - 108.00m - +20.90m
06. Canucks - 46% - 109.00m - +20.30m
07. Stars - 81% - 097.00m - +12.40m
08. Bruins - 44% - 108.00m - +11.60m
09. Kings - 79% - 092.00m - +10.60m
10. Oilers - 60% - 083.00m - +09.40m
11. Ducks - 17% - 094.00m - +04.80m
12. Avalanche - 16% - 084.00m - +04.40m
13. Penguins - 45% - 093.00m - +03.30m
14. Flyers - 24% - 101.00m - +03.10m
15. Devils - 112% - 097.00m - +01.40m
16. Wild - 54% - 095.00m - +01.30m

TOTAL OPERATING INCOME: 267.80m
TOAL LOSSES OF OPERATING INCOME (14 teams): -84.30m
DIFFERENCE: 183.50m


Last edited by CS: 11-03-2010 at 12:08 PM.
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11-03-2010, 11:48 AM
  #58
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Originally Posted by NWO View Post
Not really, as if say 8 teams are carrying the league, how is that good? While other teams add no value to the bottom line and are losing money.
11 teams performed to 100% or better attendance last year.

19 teams performed to 90+% attendance last year.

The league is rather healthy right now (far better shape than the NBA). It is not perfect, and it never will be perfect, but lets not talk about it like it's a sick animal on the verge of catastrophe.

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11-03-2010, 11:50 AM
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Originally Posted by Jester View Post
Yeah, it's quoted above. Couple of points.

1) Bettman has ZERO control over ticket prices... so he probably should not have even answered the question.

2) Notice all the weasel words in that quote. I mean, "What I said was it varies from market to market" is just awesome. Cuz, yes, it varies from market to market as the different markets figure out what is best for them economically.

I'm sure they expected the majority to lower tickets, but they're not going to keep tickets artificially low and leave money on the table. It's a business.
I agree with you. It wasn’t going to happen as it was another spin on that cost certainty word. In the case of the strong markets, that would be foolish to do as you let the market dictate what you can get out of people. Some markets like florida have what $8 tickets? That is better than an empty seat and you assume some will spend on concessions. Flyers will gauge you until you have nothing left but bones.

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11-03-2010, 11:51 AM
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Originally Posted by Chris Shafer View Post
I read somewhere that teams like Phoenix only exist to cover a section of the US population that would otherwise be uncovered by any NHL organization.

This is not something that's necessarily important to the competitiveness as a league in general, since a small market team like Phoenix is going to have a hard time getting fans in that desolate wasteland and fans = revenue to attract more NHLers.

That said, because Phoenix is covering that population whereas a team elsewhere would not, it's much easier to sell a national broadcast covering the NHL to companies that would televise NHL games nationally.

In theory, Phoenix does more for us draining money from our excess revenue than a second team in Toronto would, just because Phoenix does a lot for getting us those Winter Classics and the possible upcoming ESPN contract once Versus is over with.

I'm not sure of the details, but that's what I understood from the limited amount that I read on this subject.
Given that I can't recall the last time PHX was a national broadcast (maybe on VS here or there), not sure I buy that. The national TV market is very market-to-market based for the NHL, so it's kind of moot about spread. The NHL is, however, very conscious of reaching out to population centers and PHX is certainly that (and growing last I read about it). Same reason having a team in Miami makes sense... sure the team is struggling a bit, but if you can develop any sort of market there it's a huge win.

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11-03-2010, 11:54 AM
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Originally Posted by Jester View Post
11 teams performed to 100% or better attendance last year.

19 teams performed to 90+% attendance last year.

The league is rather healthy right now (far better shape than the NBA). It is not perfect, and it never will be perfect, but lets not talk about it like it's a sick animal on the verge of catastrophe.
How many teams lost money though? It isn’t as healthy as one might think imo. The big revenue teams carry the league. Attendance numbers can be inflated. If the nhl had a decent tv deal they would be in very good shape. The nhl outdraws the nba at the gate in most markets, their tv deal keeps them going.

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11-03-2010, 11:57 AM
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Originally Posted by NWO View Post
How many teams lost money though? It isn’t as healthy as one might think imo. The big revenue teams carry the league. Attendance numbers can be inflated. If the nhl had a decent tv deal they would be in very good shape. The nhl outdraws the nba at the gate in most markets, their tv deal keeps them going.
Big teams carry all the leagues... I mean, that's never going to change. Never. If you want to talk about big teams carrying a sport, check out baseball (which is why the economics of baseball are completely *ed).

I don't know how many teams lost money, but it's less than you think... given that we now have a revenue sharing system in place (which likely needs to be reformed a bit). And a lot of the teams that lose money is because they gamble on playoff revenue and go a bit over where they should, not because the market is in any real danger.

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11-03-2010, 11:58 AM
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Originally Posted by NWO View Post
How many teams lost money though? It isn’t as healthy as one might think imo. The big revenue teams carry the league. Attendance numbers can be inflated. If the nhl had a decent tv deal they would be in very good shape. The nhl outdraws the nba at the gate in most markets, their tv deal keeps them going.
Holy crap. You are making sense today. I agree with this post.

Because teams can report "ticket sales" as "attendance", the numbers look more robust. If they actually counted the numbers at the turnstiles, one would get a truer sense of how healthy the teams are in terms of the gates.

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11-03-2010, 12:00 PM
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Originally Posted by Flyskippy View Post
Holy crap. You are making sense today. I agree with this post.

Because teams can report "ticket sales" as "attendance", the numbers look more robust. If they actually counted the numbers at the turnstiles, one would get a truer sense of how healthy the teams are in terms of the gates.
You realize if you sell a ticket to the game the team gets the money whether the person shows up or not, right?

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11-03-2010, 12:05 PM
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Originally Posted by Jester
11 teams performed to 100% or better attendance last year.

19 teams performed to 90+% attendance last year.
I don't know what stats or source you're using, Jester, but this doesn't look accurate. According to the ESPN attendance list for 2009-2010:
80-<90%: Devils, Blue Jackets, Ducks and Predators
70-<80%: Lightning, Panthers, Avalanche, Thrashers, Islanders
60-<70%: Coyotes

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11-03-2010, 12:10 PM
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I don't know what stats or source you're using, Jester, but this doesn't look accurate. According to the ESPN attendance list for 2009-2010:
80-<90%: Devils, Blue Jackets, Ducks and Predators
70-<80%: Lightning, Panthers, Avalanche, Thrashers, Islanders
60-<70%: Coyotes
11 teams at 100%+ attendance.
8 teams at 90%+ attendance.
5 teams at 80%+ attendance.
6 teams at 68%+ attendance.

Looks about right.

19 teams at 90%+ attendance. (11 of those teams at 100%+ attendance).
11 teams under 90% attendance.

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11-03-2010, 12:15 PM
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You realize if you sell a ticket to the game the team gets the money whether the person shows up or not, right?
Yes, I also realize that like NFL teams that buy their own remaining tickets to ensure they're on TV, NHL teams can do the same.

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11-03-2010, 12:17 PM
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Yes, I also realize that like NFL teams that buy their own remaining tickets to ensure they're on TV, NHL teams can do the same.
I'm pretty sure there's no minimum audience necessary to televise an NHL game.

Also, those tickets bought by the team would show up on a statement somewhere. It's not like they can hide the fact that they're buying their own tickets.

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11-03-2010, 12:18 PM
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Yes, I also realize that like NFL teams that buy their own remaining tickets to ensure they're on TV, NHL teams can do the same.
Ah, yeah, well NHL teams don't really have an incentive to do that... (which NFL teams do), so you'd have to have evidence that teams are bothering with that (I have no doubt there is some sales inflation)... as opposed to just conspiracy theory.

Teams also get audited as part of the CBA, so those revenues are all part of the cap setup.

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11-03-2010, 12:19 PM
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seriously, with the cap over $60m, what's the point of having one?
It's not about where the cap number ultimately falls. The point of having a cap is to tie salaries as a fixed percentage of revenue. The theoretical point of a cap is to make sure salaries don't inundate revenue dollars to the point where ownership is then unable to cover operating costs without going outside revenue. So if in 10 years the cap is $80M or $100M, then good, it means revenue has gone up enough to ensure those salaries. It also forces owners on the cap floor to spend at least a certain percentage of revenue so they're not just hoarding cash to hoard cash.

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Hmm they torpedoed a whole season to get their precious cap, and now they want to gouge the players even more? Sheesh.
What I read suggested lowering the percentage had to do with the players' escrow. Not sure how it made sense, but it's just what I read, and was very early speculation. I think realistically, one of the biggest hurdles of the next CBA has already been dealt with in a very quick and civilized manner - that being the new "Kovalchuk" rule.

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11-03-2010, 12:21 PM
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What I read suggested lowering the percentage had to do with the players' escrow. Not sure how it made sense, but it's just what I read, and was very early speculation. I think realistically, one of the biggest hurdles of the next CBA has already been dealt with in a very quick and civilized manner - that being the new "Kovalchuk" rule.
They could, theoretically, lower how the cap for individual teams is calculated while not messing with % of actual revenue that is given to the players. Right now they're chronically crossing that line, and thus escrow is hitting the players (which they don't like). However, if you have a nice long-term deal, then such a change is in your interest. If you're going to be an UFA, then you want no part of any deal that limits new contracts to protect existing ones from escrow.

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11-03-2010, 12:27 PM
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Originally Posted by Chris Shafer View Post
I'm pretty sure there's no minimum audience necessary to televise an NHL game.

Also, those tickets bought by the team would show up on a statement somewhere. It's not like they can hide the fact that they're buying their own tickets.
I know that, just saying they can buy their own tickets - in the name of giveaways to staff, players, etc. Not "sales" but it makes the books look better.

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Originally Posted by Jester View Post
Ah, yeah, well NHL teams don't really have an incentive to do that... (which NFL teams do), so you'd have to have evidence that teams are bothering with that (I have no doubt there is some sales inflation)... as opposed to just conspiracy theory.

Teams also get audited as part of the CBA, so those revenues are all part of the cap setup.
I don't really wanna tread down the conspiracy theory lane. I just have serious doubts about how "healthy" the league is.

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11-03-2010, 12:32 PM
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I don't really wanna tread down the conspiracy theory lane. I just have serious doubts about how "healthy" the league is.
Yeah, well the Caps owner just got into the NBA finances this past year, and basically said the NHL is way ahead of the NBA as far as health.

The NHL is doing just fine, and about to do better given that the next TV deal should be a bit more favorable.

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11-03-2010, 12:38 PM
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here are the stats so far this year for attendance. I wonder how much lower the Yotes would be if you take out that 17k for there home opener. Could say that for many teams

http://espn.go.com/nhl/attendance

if you click on schedule and go back to the start of the year there really are some appaling attendance numbers in many markets. not just in Phoenix and Atlanta.
The leagues baby the Pittsburgh Penguins are 11th in road attendance

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11-03-2010, 12:49 PM
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Originally Posted by GoneFullHolmgren View Post
here are the stats so far this year for attendance. I wonder how much lower the Yotes would be if you take out that 17k for there home opener. Could say that for many teams

http://espn.go.com/nhl/attendance

if you click on schedule and go back to the start of the year there really are some appaling attendance numbers in many markets. not just in Phoenix and Atlanta.
The leagues baby the Pittsburgh Penguins are 11th in road attendance
We're at 99.6% and 13th???

That needs to be corrected ASAP.

Stupid Phillies playing games in October.

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