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EXCLUSIVE: Fox Closing In On Dodgers’ TV Rights; ‘We’re Out’ If Not Done By Nov. 30

By | Saturday November 24, 2012 @ 6:52pm PST

UPDATE: Not so fast. The deal didn’t get done and now Time Warner Cable is hot and heavy into the negotiating mix. Fox is pissed, to say the least.

EXCLUSIVE:  It seems strangely logical that the highest-priced sports team in the world is about to score the richest TV deal ever in pro sports history. Insiders tell me that Fox Sports is close to clinching the exclusive TV rights for the Los Angeles Dodgers by paying between $6 billion and $7 billion over 25 years to put the team on its regional sports network in Southern California and of course its national Fox Broadcasting Company. Fox already shows the games on its Prime Ticket local cable channel but also has Fox Sports West here.

The previous agreement expires at the end of next season, and saw Fox Sports paying only about $40 million per season for the Dodgers TV rights. There was speculation the final price would just go north of $150 million per season. This new deal soars to $280 million per season (the average for the life of the contract). The huge outlay by News Corp demonstrates the increasing value of sports to its bottom line, while the huge payday for Guggenheim offsets the record-setting $2.15 billion price paid for the Dodgers.

Related: Dodgers, Fox Sports Settle TV Rights Feud

But the sheer greed of Guggenheim’s ask on this new deal is staggering, especially when you consider it will all get passed down to the cable systems, advertisers, and ultimately consumers. The alternative for Guggenheim included higher ticket prices which would serve to only further alienate fans. Plus the new owners claim to need the money to bribe talented players to come to the mediocre Dodgers. And then there’s the sad fact that Major League Baseball teams are shifting from broadcast TV to cable networks – so fewer games will be available on free TV. Fox Sports expects to broadcast only one or two Major League Baseball games a week for the national audience next season.

Guggenheim and Fox Sports began preliminary talks in May. Then Fox Sports Media Group Co-President/COO Randy Freer enjoyed a 45-day exclusive negotiating window with Guggenheim Baseball Management’s Todd Boehly, the president of private equity firm Guggenheim Partners who was negotiating solo for the Dodgers owners. (Those owners also include former Los Angeles Lakers star turned mega-investor Magic Johnson, former Atlanta Braves and Washington Nationals president Stan Kasten and Mandalay Entertainment CEO Peter Guber.) Those talks began October 15th and are set to expire on November 30th. My insiders think, barring any unforeseen obstacles, the Fox-Dodgers deal could clinch by Tuesday. If it doesn’t get done by the 30th deadline, Boehly will have blown the negotiations bigtime.

Related: Magic Johnson’s Group Wins Bidding To Buy Dodgers

I’m told a deal came “very close” to being done about a week ago “and then it went a little bit south”. To rattle Guggenheim’s cages, Fox Sports delivered an ultimatum that a deal had to be done by the end of this month or else it would stop negotiating. (Terms like “It’s dead” and “We’re out” were used.) The Fox Sports gambit worked. Because it would have left Guggenheim in a terrible situation without multiple bidders and with little leverage for next-in-line Time Warner Cable since CBS, Comcast/NBC, ABC/ESPN and even the MSG Network (controlled by the owners of Cablevision) never materialized. Of course, Guggenheim could have opted for the Dodgers to start its own network, as the Mets and Yankees have done. But big rewards come with big risks.

Also, in the middle of the run-up to negotiations in early October, Guggenheim’s Boehly bought Dick Clark Productions and put on the table a “programming element” involving Fox Broadcasting Network and DCP. Specifically, it called for DCP to have “more inventory” i.e. more shows airing on Fox Networks, sources tell me. I’m told the provision has been “in and out and in” the deal over recent weeks but appears to be ‘in’ right now.

Freer really knows this business – he ran the Fox regional sports networks for nearly half a decade - and knows not to overpay. He’s not when you consider that the Dodgers will play 162 games when the season starts in April. And yet TV rights to the Lakers who play 82 games just sold to Time Warner Cable for $3B over 20 years. And Fox just paid $3B for 49% of the YES Network which owns TV rights to the New York Yankees for 20 years. Read More »

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Fox Sports, LA Dodgers Discussing Potential $4B Cable Deal: Report

They can’t formally begin talks until Oct. 15, but Fox Sports and the Los Angeles Dodgers are said to have started preliminary discussions on a new cable pact. Last year, Fox and former Dodgers owner Frank McCourt struck a 20-year, $3B deal that included a provision giving the Dodgers 30% of the Fox Sports channel. But, Baseball Commissioner Bud Selig did not allow that pact to proceed. Citing a source familiar with the current talks, Reuters reports the renewal being discussed since May would “almost certainly exceed” the kiboshed deal and include joint ownership of English and Spanish language channels. According to the Reuters source, no financials have been discussed, but sports consultant Marc Ganis said the new deal could cost $4B or more. Fox and the Dodgers’ current deal expires at the end of next year. Read More »

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Sportscaster Erin Andrews Shifts To Fox

By | Sunday July 1, 2012 @ 4:42pm PDT

Fox SportsSportscaster Erin Andrews, who exited ESPN last week as co-host of College GameDay, has joined Fox Sports as speculated, where she’ll host the network’s new primetime college football pregame show as well as have a significant role in National Football League, Major League Baseball and other sports coverage. Fox Sports announced Andrews’ multiyear deal today. Andrews, who got her start at Fox Sports Florida in 2000, spent eight years with ESPN. Fox Sports’ new half-hour pregame show will lead into the network’s first regular-season over-the-air college football package. That coverage kicks off Saturday, Sept. 1 as Hawaii visits USC live from the Los Angeles Memorial Coliseum.

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Co-Host Erin Andrews Leaving ESPN

By | Friday June 29, 2012 @ 3:49pm PDT

After being with the sports network for eight years, Erin Andrews is leaving ESPN. The sports network’s VP of Communications Josh Krulewitz tweet this afternoon that “Erin Andrews leaving ESPN. She did great work for us & we made an aggressive offer to keep her. We wish her the best on her next chapter.” Andrews’ contract with ESPN expires tomorrow. Sports Illustrated reported earlier that Fox Sports was talking to Andrews about the host coming over to them. Andrews, who joined ESPN in 2004, has been the co-host of the network’s College GameDay since 2011. Andrews hasn’t actually appeared on-air for ESPN since March when she reported on a college basketball tournament. The host, who appeared on Dancing With The Stars in 2010, was also a contributor to Good Morning America, though she hasn’t appeared on the show since covering the 2011 Academy Awards.

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Magic Johnson’s Group Wins Bidding To Buy Dodgers For Record $2B

By | Tuesday March 27, 2012 @ 9:01pm PDT

The bidding group is the last one standing after many Dodgers suitors came and went during the monthslong process, and the $2 billion deal is the richest ever for a U.S. sports franchise. The new owners — who emerged after three groups participated in a U.S. Bankruptcy Court auction today — are grouped under the banner Guggenheim Baseball Management. That mix includes Magic Johnson, Hollywood producer Peter Guber, baseball executive Stan Kasten and Bobby Patton as well as Todd Boehly and Mark Walter of Guggenheim Partners — that company co-owns Prometheus Global Media, which owns Billboard and The Hollywood Reporter. Walter will be controlling partner of the Dodgers when the deal closes at the end of April. The agreement with soon-to-be-ex-owner Frank McCourt is for the team and Dodger Stadium, and a separate joint venture with some members of the group — including McCourt — will buy the parking lots and property for an extra $150 million. That $2.15B total could be eclipsed by the local TV rights deal that’s sure to come after the sale is approved — the team could create its own regional sports network (a la the New York Yankees’ lucrative YES Network), shop the rights, or re-sign with current partner Fox Sports, which already had offered a long-term deal worth close to $3 billion.

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Dodgers, Fox Sports Settle TV Rights Feud, Clearing Path For Sale Of Team

By | Tuesday January 10, 2012 @ 10:59pm PST

The Los Angeles Dodgers and Fox Sports late Tuesday settled their legal feud over the sale of the bankrupt team’s broadcast rights after the 2013 season. The Dodgers agreed to abide by their current contract with Fox and won’t attempt to auction future rights before Fox’s exclusive negotiating period ends November 30. In exchange, Fox agreed to drop litigation against the Dodgers. The settlement removes uncertainty and will allow the Dodgers to be sold by April 30 under a deal owner Frank McCourt previously reached with Major League Baseball. Initial bids are due January 23. Potential buyers include Joe Torre, LA area developer Rick Caruso, Orel Hershiser, Magic Johnson, Steve Garvey, Peter O’Malley, Fred Claire, Andy Dolich, Steve Cohen of the hedge fund SAC Capital Advisors, Stan Kasten, Guggenheim Partners CEO Mark Walter, Larry King, Jason Reese of Imperial Capital and the family of the late Roy E. Disney.

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Fox Sports Wins Round Against The Dodgers

By | Friday December 23, 2011 @ 2:30pm PST

Fox Sports has won a temporary stay that bars the Los Angeles Dodgers from shopping broadcasting rights to new bidders until a judge considers the network’s appeal of the federal bankruptcy court ruling in favor of the team. Federal Judge Leonard P. Stark ruled today in Delaware that Fox Sports has a “strong likelihood of success” on its appeal of the U.S. Bankruptcy Court ruling. Fox Sports’ current contract precludes the Dodgers shopping the rights until October 2012. Because the Dodgers are in bankruptcy, the bankruptcy court judge said that condition was unenforceable. The appeals court judge disagreed and granted a stay until he decides Fox’s appeal.

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Dodgers Win Approval For Early TV Rights Bidding; Bloomberg Reports Fox To Appeal

By | Thursday December 8, 2011 @ 9:18pm PST

The Los Angeles Dodgers received bankruptcy court permission Thursday to try to sell future TV rights to its baseball games months before their existing contract with Fox Sports allows, Bloomberg reported. The federal bankruptcy judge in Delaware overruled Fox’s objection to the team entering early negotiations with Fox competitors. Fox Sports has broadcasting rights through the 2013 season but was fighting to retain exclusive bidding rights under that contract until Nov. 30, 2012. That contract would have precluded any other bidders prior to that date but the judge’s decision Thursday eliminated that exclusivity. The judge gave Fox 45 days exclusivity to come to a new agreement with the Dodgers. The countdown for that window started November 30. If no deal is reached, Time Warner Cable is eager to jump into the fray. It already won the rights to broadcast Los Angeles Lakers games on a new regional sports network which will replace previous rights holder Fox Sports. Competition for sports programming is driving up prices for rights and allowing early bidding on the Dodgers will likely increase the value of the team in the upcoming sale. The Dodgers filed for bankruptcy in June with the idea that proceeds from the sale of media rights would be used to pay creditors. Current team owner Frank McCourt intended to retain ownership but Major League Baseball agreed to a sale to get rid of McCourt, whose stewardship has  been less than optimal. … Read More »

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Sports Fees Vex Cable Execs: UBS Confab

By | Monday December 5, 2011 @ 8:43pm PST

The per-household subscription fees ESPN charges cable systems amounts to “a tax on every American household,” Liberty Media Corp. CEO Greg Maffei said Monday at an investor conference sponsored by UBS AG in New York City. ESPN charges are the highest of any cable channel, according to SNL Kagan, which estimates those per-subscriber fees have jumped 42% since 2006 to $4.69. By comparison average cable channel fees were up 24% for that period to 26 cents a month. The problem isn’t just ESPN, Maffei said later, because regional networks such as Fox Sports also contribute to the overall escalation of fees networks pay to carry events. NFL, for example, is negotiating contracts that could raise broadcast networks’ fees by 60% to about $3.2 billion a year, the Wall Street Journal noted. Some executives think it might be better to position expensive sports channels such as ESPN on a separate tier that would allow uninterested subscribers to opt out and lower their bills. Otherwise, rising sports rights fees could lead many consumers to drop services. MTV Networks and Nickelodeon owner Viacom Inc.’s CEO Philippe Dauman also singled out ESPN as a significant factor in higher costs because it is “double the cost of all our networks combined.” Even though they still resist the idea of a la carte packaging, media exec are beginning to see the merits of selling smaller, cheaper programming bundles as … Read More »

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Dodgers Update: TV Rights Hearing Set For Dec. 7; Larry King Part Of Group Seeking To Buy Team

A U.S. Bankruptcy judge today set December 7 to kick off a two-day hearing about whether the Los Angeles Dodgers can begin marketing the team’s lucrative future local TV rights, which Fox Sports holds through the end of the 2013 baseball season. Fox already has sued the Dodgers to block any early rights sale. The network claims its regional network has an exclusive window to renegotiate a new deal as part of its current contract, and that that team is using bankruptcy protection to break that agreement. (As part of that lawsuit, Fox will ask Judge Kevin Gross to dismiss the team’s bankruptcy altogether in a hearing set for December 27.) How valuable are those TV rights? Soon-to-be-ex-Dodgers owner Frank McCourt at one time had a $3 billion deal with Fox in place before it was rejected by Major League Baseball and commissioner Bud Selig, forcing McCourt to seek bankruptcy for the team and eventually agree to sell the franchise outright. Read More »

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Fox Sports Asks Court To Dismiss Dodgers From Bankruptcy

By | Friday November 18, 2011 @ 8:48pm PST

Fox Sports has asked a federal bankruptcy court to dismiss the Dodgers from bankruptcy as the networks said it would earlier this week, the LA Times reported late Friday. Fox Sports said it is not necessary for owner Frank McCourt to market the team’s TV rights to fulfill his obligations to creditors. Fox contends McCourt can repay his creditors in full simply by selling the team “for a handsome price” either with the current TV contract with Fox Sports or with a new owner negotiating a new TV deal. The team’s bankruptcy likely would hamper Fox’s ability to enforce its existing contract without court intervention. The Dodgers would like to auction those rights and attract higher bids for the team and for those broadcast rights. Fox has asked the court to enforce the current contract that bars the Dodgers from discussions with any other media outlets before November 30, 2012. Major League Baseball extracted an agreement with McCourt to sell the team, and he’s promised to close a sale by April 30. Fox cited the $160 million contract with Matt Kemp as evidence that bankruptcy is not necessary for the Dodgers to continue operating and that McCourt is just trying to come out of any deal with more money in his own pocket.

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Dodgers Sue Fox Sports, Which Responds That It Will Ask Court To Dismiss Team From Bankruptcy

The Los Angeles Dodgers sued Fox Sports on Wednesday, accusing the News Corp-owned network of attempting to ”interfere with the sale of the Dodgers and their assets in bankruptcy.” The Dodgers’ goal is to sell the team and its valuable TV rights through separate court-sanctioned auctions to maximize returns. In a sharply worded court response filed Wednesday night Fox said it would ask that the Dodgers be dismissed from bankruptcy, according to the LA Times. Fox slammed Major League Baseball as “Prime Ticket’s former ally” and asserted the only reason Frank McCourt wants to auction the team’s TV rights now is to put “value rightfully belonging to Prime Ticket,in his own pocket” — referring to Fox Sports’ package of programming. The Dodgers’ suit was filed in U.S. Bankruptcy Court in Delaware, where Fox already has a suit pending against the team for alleged breach of contract in the continuing squabble over TV rights. Responding to the latest development, the Dodgers called Fox “obviously desperate” to prevent an auction that would reveal the “enormous value” of those rights and “lead to a record-smashing sale price for the team and benefit not just the Dodgers but all of baseball.” Read More »

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Los Angeles Dodgers Will Have New Owner After Frank McCourt Makes Deal To Sell

If Frank McCourt’s fight to remain owner of the Los Angeles Dodgers seemed long and arduous, it was — after all, he had to fight his ex-wife Jamie with one hand and baseball commissioner Bud Selig with the other. If the end of that fight seemed to come fast and easy, well, it kinda did. Here’s the release from Major League Baseball that came out tonight announcing a deal to sell one of the most popular and lucrative franchises in sports:

“The Los Angeles Dodgers and Major League Baseball announced that they have agreed today to a court supervised process to sell the team and its attendant media rights in a manner designed to realize maximum value for the Dodgers and their owner, Frank McCourt. The Blackstone Group LP will manage the sale process.”

According to the L.A. Times, the sale would include the team, Dodger Stadium and its parking lots, which McCourt paid $421 million for in 2004. McCourt has put the current value of the team at more than $1 billion; Forbes said it is worth $800 million. Any new owner would certainly attract a lucrative TV rights contract — one worth more than the reported 20-year, $3 billion deal McCourt negotiated with current rightsholder Fox Sports that he said would have given him the cash to keep the team. Selig rejected that … Read More »

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UPDATE: Fox Steals World Cup TV Rights From ESPN & Telemundo Scores Too; Total Deal Could Exceed $1B

By | Friday October 21, 2011 @ 9:40am PDT

UPDATE: 12:45 PM: The Sports Business Daily is reporting that Fox will pay $450 million-$500 million for rights to the next two World Cups, and Telemundo will pay $600 million. If true, those are massive markups from the last U.S. rights deal in 2005, when ESPN paid $100 million and Univision $325 million.

PREVIOUS, 9:40 AM: Fox Sports has won the English-language rights to broadcast the 2018 and 2022 soccer World Cups in Russia and Qatar, respectively, and Telemundo has won Spanish-language rights, after bidding was held this week in Zurich. No financial details were disclosed, but an official announcement is expected sometime today or early next week, according to Sports Business Journal; the deal includes rights to the Women’s World Cup in 2015 and 2019. It means current rights-holders ESPN and Univision — whose deal for the past two World Cups cost them a combined $425 million — lost out in the auction at FIFA headquarters, a surprising outcome that didn’t seem to be on anybody’s radar. ESPN, whose current deal includes the 2014 World Cup in Brazil, said this morning in a statement: “We made a disciplined bid that would have been both valuable to FIFA and profitable for our company, while continuing to grow our unprecedented coverage of the World Cup and Women’s World Cup events. We were aggressive while … Read More »

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Fox Sports Sues Dodgers Over TV Rights

By | Wednesday September 28, 2011 @ 9:00am PDT

Frank McCourt’s fight to keep the Los Angeles Dodgers might have cost him another ally. Fox Sports, which owns TV broadcast rights to the Dodgers (as well as exclusive negotiation rights when the current deal expires after next year), has sued the team in U.S. Bankruptcy Court, saying the Dodgers are breaching their contract by shopping future rights. “The telecast rights to the Los Angeles Dodgers baseball games are an inherently unique and irreplaceable asset and business opportunity,” the filing reads. McCourt, who lost financial control of the team to Major League Baseball earlier this year, sees the next media-rights deal as the key to solidifying his and the team’s cash woes, which would allow him to remain owner. Remember, McCourt and Fox had worked out a long-term extension this year that would have given the owner $385 million in upfront payments that he claims was necessary to keep the team afloat, but MLB commissioner Bud Selig vetoed the deal. For Fox Sports, which airs the games on its cable channel Prime Ticket, the lawsuit is an attempt to keep a valuable asset and fend off rivals like Time Warner Cable, which already acquired the Los Angeles Lakers’ TV rights and created a pair of regional sports networks to air games. It’s likely the cabler would want to do the same with the Dodgers. McCourt has said in court filings that DirecTV and Dish Network also might make bids … Read More »

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Rights Deal Puts Fox In Ring With UFC

By | Tuesday August 16, 2011 @ 11:45am PDT

Fox Sports and mixed-martial arts league UFC have just finalized a multi-year deal that will put at least four primetime MMA cards on the Fox network each year and weekly programming on cable sibling FX. The Sports Business Journal says the deal could be worth as much as $90 million a year over seven or eight years; Fox Sports declined to comment. A broadcast deal is a big step up for UFC, which in addition to lucrative pay-per-view events has weekly shows on cable nets Versus and Spike TV — under the new agreement with Fox, that programming will move to FX beginning in January after those deals expire. (Spike TV still owns rights to a library of UFC programming, including episodes of UFC Unleashed, through 2012.) Fuel, another Fox-owned cable network, also will see some UFC programming, SBJ says. The deal also is a coup for Fox: In June, it was reported that Comcast’s NBCUniversal was in serious negotiations with UFC, with those talks centered on the league taking a controlling stake in NBCU’s G4 cable network, which sported the right young-male demo but has seen ratings challenges. NBCU-owned Versus also already had UFC programming. Instead, rival Fox has taken those demo eyeballs away.

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Fox Sports Not Part of Proposed Dodgers-MLB Loan Deal

By | Friday August 5, 2011 @ 2:23pm PDT

The Los Angeles Dodgers agreed to borrow as much as $150 million from Major League Baseball, almost two weeks after the judge overseeing the team’s bankruptcy ordered the two sides to negotiate a deal. The Dodgers today sought a judge’s approval for terms of the loan, which would finance the team’s operations while it is under court protection in Wilmington, Del., according to a report from Bloomberg. The plan does not address the proposed cable television rights deal Dodgers owner Frank McCourt negotiated with News Corp’s Fox Sports. It was MLB’s refusal to OK that deal which lead to the Dodgers filing for bankruptcy in June. Team lawyers said in court they intend to try to sell those rights while in bankruptcy and will propose rules for marketing them this month. Fox has said in court that it would oppose any effort to sell the rights before its exclusive right to negotiate a deal expires next year.

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Sports Report: NFL Thursday TV Package In Play; Dodgers Anger Ally Fox Sports; NBA Lockout Hits The Courts

The NFL is shopping an eight-game Thursday primetime TV package, with commissioner Roger Goodell having informal conversations with networks last week, according to the Sports Business Journal, which is reporting that a stake in the league’s NFL Network might be in play for the winning bidder. The talks are expected to gain momentum now that the league-imposed lockout is over. The NFL Network currently has rights to eight late-season Thursday NFL games; the new package will cover the early season. The SBJ says Turner and Comcast would be front-runners, especially since they have cut previous deals that included league-owned assets (Turner pacted with the NBA in 2007; Comcast has a similar deal with the NHL). Fox and ESPN also are expected to be interested in the package. … Read More »

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Dodgers Owner Gets OK For Bankruptcy Loan; League Backs Off After Team Agrees Not To Auction TV Rights

The Delaware court that is sorting out the Los Angeles Dodgers’ Chapter 11 filing has authorized the team to enter into a $150 million bankruptcy financing arrangement that will allow owner Frank McCourt to meet the Dodgers’ payroll obligations this week. The deal came together today as Major League Baseball dropped opposition to the financing after getting the Dodgers to agree to not auction off their broadcast TV rights for the next six months and seeing that a $4.5 million fee from the facility’s lender — JPMorgan Chase’s Highbridge Capital Management — be reduced to $250,000.

The TV rights are everything to McCourt now; he says that a deal in place with Fox Sports worth $3 billion over 17 years would put the team back on solid financial ground, but MLB commissioner Bud Selig would not approve the contract, saying too much of the upfront money would go to McCourt, not the franchise. A Dodgers lawyer told Bloomberg today that the team still has the right to propose a TV-rights auction while under court protection, so who knows what the league really gets out of that part of the agreement. One possibility is that Selig and the league will seize the Dodgers within that six-month time frame; baseball clearly believes the Dodgers and their TV rights are worth more on the open market if a new, more palatable owner (we’re talking to you, Mark Cuban) were to step up to … Read More »

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