Thursday, October 28, 2010

Microsoft FY11Q1 Results

How about some FY11Q1 Microsoft earnings!

My usual suspects for earnings discussion:

Once more, with feeling.

I expect that we'll have yet another break-out quarter, a better idea that Kinect is poised to be a great seller for the holidays (sell-out pre-orders and screaming Oprah audiences can't be too wrong), and some glow from reasonable WP7 reviews (oh, and yes, we all realize that it doesn't have copy and paste - and yet the apocalypse will not arrive).

So this seems like a do-over with more good news from the last quarter. Will Wall Street react with the same "Meh?"

An interesting pre-earnings release article: Sleepy in Seattle - Microsoft learns to mature.

Again, not much love for Mr. Ballmer. So, since the last quarterly earnings, Ms. Friar at Goldman Sachs dropped a bomb on Microsoft and there's been serious concern that Mr. Ballmer is clearing the executive bench at Microsoft. Or is it cleaning house? Since we're unable to criticize any mistakes our departed leaders have made, it remains a big unknown.

iPad, iPad, iPad!

Once it was "Google, Google, Google." Now it's Apple's iPad meant to be Microsoft's undoing. First of all, major props to Apple's continued success. It's been a long journey for Steve Jobs and Apple - especially for those of us who read The Journey is the Reward back when it was new. I like my iPad. It's fun. It's also no notebook replacement. I'm not even going to use it for writing tweets on Twitter, let alone writing emails. It's for screwing around, and I like screwing around... so I like my iPad. I'm blessed that I've got the spare cash for such a luxury device and the spare time to play with it.

It's a new, quick consume experience that our Tablet vision failed to realize because our Tablet vision (like all visions of that time) was so firmly shoved up the Enterprise's butt we didn't care for consumers who'd pay good money to have a fun device to facilitate their screwing around.

We continue an expensive lesson in enlightenment. And spanking: Microsoft's consumer brand is dying.

And goodness help us if Apple TV takes off. Our inability to string together a coherent TV strategy (despite having been in the TV realm for over a decade) is yet another dropped pants embarrassment waiting to happen and represents the anxiety that Wall Street has about our future despite having successes in the present.

Bloodletting

Cost cutting's slippery slope continues. I'm sure if we don't talk about continued overhead management (people, benefits, etc) that it will be an analyst question. I still believe we need to chuck about 15,000 positions (and half of our super-ballooned contingent staff) rather than continue the slow squeeze around the company that's making this an ordinary job with some extraordinary wonderful people who just haven't given up on the company. Yet. I hope that the analysts realize that continued, consistent bloodletting because a negative for hiring, and (allow me to be pro-hiring for a moment) if we can't bring in deep-talented new blood to replace the departed dead wood, our future is doomed to mediocrity.

And that doesn't get you a good dividend.

New Talent

And we're losing the battle for hiring new talent. If you review who we're losing to, it's a big surprise. You look at who is ahead of us in preference and you say, "Really? Graduating students think they are a better place to work than us?" It's a cold splash of reality that makes me - they guy who said we've turned things around and things are going great for our major initiatives - wonder if things are worse outside of the Microsoft bubble than I thought.

Frank, you're fighting an epic battle.


-- Comments

655 comments:

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Anonymous said...

How many people does Steve need to force out before he loses his own job?

Muglia is a class act, and regardless of what went down, deserved better than that bullshit email Steve sent out.

Ballmer is a 21st century Nero, playing Kinect while he burns the company down around him.

And let's not forget that Kinect, the thing he's going on about (and is arguably pretty great), is to be held up as an example of our innovation. He fails to mention that management didn't want it and it wouldn't have happened if some employees weren't extremely passionate about the possibilities.

Anonymous said...

Mini, oh, Mini....

Where's the bobmu post?

KK said...

You can read http://www.seattlebusinessmag.com/article/rough-landings and remove Boeing references and put Microsoft (and planes with various Microsoft products) and it still rings true!

Anonymous said...

Mini- you LAZY BASTARD. Wake up!
I need some of your dose...
Big news like Bobmu leaving deserves a blog post..

Anonymous said...

Muglia is pushed out the door and NOTHING?

Even Mini has given up on Microsoft it appears.

Anonymous said...

Is this blog alive anymore?

I mean, we have Bob Muglia leaving, Midyear Career Discussion starting, the general mood at MS where I'm at seems to be the most depressed in 2 years, lots of people are looking for new jobs, whether in or out of MS, etc.

Anonymous said...

I've been following this guy's blog for a few months. His odd insistence that thousands of low level workers get laid off at the same time and this is the only way to save the company makes me think he's some kind of middle management bean counter. There's no reason the thousands of people he wants to cut couldn't be made productive with a competent management that could set strategic goals and actually implement them. Of course, that isn't currently possible since Microsoft has been taken over by the bureaucrats. At any rate, a long slow decay of the company is pretty much guaranteed now so I'll just keep adding to my savings while crackpots like this guy pontificate on laying off all our testers and technical people.

Anonymous said...

Mini,

I said it before ... if you don't want to do this anymore shut it down. No post for 3 months and no comment moderation for 4 weeks. Not good - U/10.

Anonymous said...

Dear Microsoft,

Here are some ways you can improve your products, as well as appearing less ridiculous. Hey, it's a win-win!

- Stop relying on drive letters. For example SQL clustering devices are limited to the 26 letters of the alphabet. Heard of this new thing called UNC?
- Stop relying on filename extensions. Mac OS and Linux do not use this approach as all.
- Standardize window behaviors within applications. Sometimes they can be resized, other times not. Take a look at Outlook 2010 for an example.
- Standardize error message numbers. Assign each application an identifier prepended to the error number. For goodness sake, they are not even the same lengths. And as for 'click here for more information on this error' - please! The most likely outcome is "No further information is available on this error" followed by "Did you find this information helpful?"
- Improve on-line support. Most of the time potentially useful information is buried within social.technet.microsoft.com where it is almost impossible to find anything. THe product groups do a great job posting deployment and architecture guides and a piss-poor job of providing meaningful support info.

Anonymous said...

This pretty much sums it up..

PLEASE LEAVE STEVE!

http://www.eweek.com/c/a/Enterprise-Applications/Steve-Ballmers-CES-Performance-Proves-He-Needs-to-Go-10-Reasons-Why-712672/?kc=EWKNLEDP01132011A

Anonymous said...

Are you going to post anything about BobMu leaving MS?

Anonymous said...

MINIMSFT is shut down. Gone. Dead. The most competant microsoft exec under Balmer gets fired and not a word from minimsft. And no comment from anyone else either. WTF?!

There is more to msft-watching than bitching about stack ranking.

Anonymous said...

Steve Ballmer's CES Perfomance Proves He Needs to Go

Anonymous said...

Windows Phone 7 sales disaster.

Ballmer is dancing as fast as he can, but WP7 is dead in the water. LG says so. The market says so. Comscore says so. Oh well. SteveB will keep talking up Kinect and Windows 7 and XBOX, but a the end of the day he has failed. I watched his performance at CES and thankfully while the spittle was kept at a minimum, it was embarrassing.

And oh BTW Bing lost market share to Google.

The Board will do nothing.

Have a nice day.

Anonymous said...

Could you disable moderation? Or is this blog dead and we should move to some new forum?

Anonymous said...

bobmu leaving doesn't deserve a new post?

Anonymous said...

Muglia leaves, WP7, CES ... no mini post since October? What's up?

Anonymous said...

Is is just me, or do others share the mental image of Ballmer licking his lizard lips, grinning, while opining 'when Jobs dies their stock will tank'.

If SteveB were to be diagnosed with a life-threatening disease, which way would MSFT stock move? Would Wall Street be demanding more details? Apart from where to send the flowers?

Anonymous said...

just curious: how comes there has been no post in 2011?

Anonymous said...

Mini - where did you go? no posts since 12/29/2010, and no comments on BobMu resignation?

Anonymous said...

No updates for awhile.

What's going on here?

Lots of things have been happening in the MS world, the most recent event being Bob Muglia's emminent departure. I'm surprised there hasn't been more commentary.

Anonymous said...

>Windows 7 is less painfull then vista...

If that's not damning with faint praise, I don't know what is.

Anonymous said...

Has this blog gone dead? No postings in January?

Anonymous said...

Hey Mini,

Bad MYCD? Parade-rain?

Please, a sign that you are still with us. Or not.

Thanks,

Cuntus Basilicus

Anonymous said...

Are you still here? Fortune's website listed Microsoft #20 top paying company.

http://money.cnn.com/galleries/2011/pf/jobs/1101/gallery.best_companies_top_paying.fortune/20.html

Anonymous said...

what the fuck are you waiting for? Start pushing posts.

Anonymous said...

Alright Mini: time to take your lips off the Kool-Aid jar and send out another post! Earnings are out soon!

Anonymous said...

Q2 results will be announced later today. No posting from you Mini? Have you retired?

Anonymous said...

The idea that your white collar husband, who probably made 50-100% more than the median WA state household income and QUIT his cushy office job, deserves unemployment is insulting and an abuse of the system.

I posted this. Touche to the guy who pointed out that it's unemployment *insurance*. Good point.

The key fact is still that this guy QUIT his job though. Of course you can't claim unemployment if you quit or get fired from your job. What would keep people from taking a dump on their boss's desk and then watching TV on their couch for the following 6 months?

Oh, the option was "quit or get fired." Boo hoo. Get fired then. You should have a paper trail a mile long showing that the firing was unjustified. Lawsuit city.

And "emotional abuse"? What kind of grown adult would let himself be emotionally abused by a faceless multinational Fortune 500 company? Do you need a ride to the battered employee's shelter so Microsoft can't find you?

As for the "context of the local standard of living," come on. What makes you think you are entitled to your former standard of living? Sell your house, sell your cars, move in with your friends or family, buy groceries in bulk and cook meals at home, buy a used Toyota for $1500, get prepaid cell phones, etc. Poor people can get by with very little money so why can't you? Have some dignity instead of whining about "standards of living."

Anonymous said...

"Creating emotional problems in someone and then complaining that they have emotional problems but forgetting to mention in the same statement that they weren't there before you started abusing him is bogus as well."

Abuse can't create emotional problems in someone who didn't have something wrong with them originally? Yes, it can and does every day.


Anyone who says otherwise - anyone who believes that ongoing chronic stress is not destructive and a direct cause of clinical, chemical depression - really needs to pick up a copy of the book 'Brain Rules' by Dr. John Medina, and read the chapters on stress.

The human brain and body are not designed to endure endless, repetitive adrenaline and cortisol dumps into the system. They break down at a chemical level. They stop functioning correctly. That's biology.

If the situation causing the stress feels inescapable, that creates 'learned helplessness'. Nothing you do, nothing you try, makes your situation better. You work harder and harder, longer hours and longer hours, and you still get bad reviews.

Go ahead, blame the people broken by that system, and not the people who designed it. It's just business....right?

Anonymous said...

WORST OF CES 2011: STEVEB's show.

WOW THIS IS CNN > MONEY'S

FRONTPAGE NEWS

SHAME SHAME.

THIS IS NOT STEVEB'S FAULT, IT'S THE FAULT OF ARROGANT AND INCOMPETENT MANAGERS WHO HAVE A MEGA EGO, WHO HAVE LAID OFF 1000's OF HIGH PERFORMING EMPLOYEES USING DIRTY POLITICS.

HA..HA..HA..HA..HA.......


1+1+1+.......

Anonymous said...

An update for hubby who "resigned voluntarily" in August: No job yet. No leads yet. Unemployment...

See Matt Bean, Seattle employment Attorney.

Anonymous said...

In response to the post regarding the individual fighting for Unemployment benefits and trying to get his sanity back:

I understand your pain. I went through the same U10 gangplank and it lasted for about a year, from one midyear review to the next.

During this time various people including my manager(s), Group Managers, HR people etc. all advised me to quit!! This was in 2009 right at the height of the recession. Of course they also skuttled all my attempts to find anything internal by refusing to give me permission to interview.

But I did some research and found out that if I quit on my own, I won't qualify for unemployment. period.

So I hung on, took the abuse, and knew it was only a matter of time before they finally terminated me.

After a month of being unemployed it dawned on me that my level of unemployed stress was much much lower than a A/U 10 stress!1

I have found a couple of contract jobs since then, I go in do the best work I can, the full timers appreciate it as I don't compete with them and it helps their reviews :)

Hang in there, pray and remember being back at MS as a full-timer is the least desirable option.

Good Luck,

Anonymous said...

Re: Matt Bean

Is he handling an existing class action suit, or other similar ex-MS cases?

BTW: small update: hubby is now receiving Unemployment Insurance, and applying for every suitable job we can find. He has had one callback, from a staffing company for Expedia. The phone interview went well (they seemed interested). He has not heard back since.

In all my searching through job listings, I see a WHOLE lot of jobs being re-listed week after week after week. The employers are asking for the moon and not getting it, and it makes me wonder how they're managing to scrape by without the uberspecialists they require. And why they don't just hire somebody who is *almost* good enough, and train them up.

Anonymous said...

Those job listings are for H-1B PERM filings.

Anonymous said...

But I did some research and found out that if I quit on my own, I won't qualify for unemployment. period.

So I hung on, took the abuse, and knew it was only a matter of time before they finally terminated me.


Not an option if you have a sick child and you need COBRA. Correct me if I'm wrong, but if you are fired, you can't get COBRA.

Anonymous said...

Not an option if you have a sick child and you need COBRA. Correct me if I'm wrong, but if you are fired, you can't get COBRA.


If you are terminated as a U/10 Microsoft does it indicating that "the role was not a good fit". You are not terminated because of gross misconduct. So, because of this you are able to get unemployment and also qualify for COBRA. Part of my research was to talk to folks who were terminated as a U/10 and understand the steps that are required to be done post termination.

There are a lot of issues to think about along with the stress of dealing with the U/10 issues themselves.

Anonymous said...

You get COBRA no matter how you got fired.

Anonymous said...

"Not an option if you have a sick child and you need COBRA. Correct me if I'm wrong, but if you are fired, you can't get COBRA."

You're wrong. You can get COBRA unless you're terminated for something heinous, like "gross misconduct".

If you're unable to find another job while still working at Microsoft but you know the axe will eventually fall, it frequently makes more financial sense to stay until terminated.

Anonymous said...

"because of this you are able to get unemployment and also qualify for COBRA. Part of my research was to talk to folks who were terminated as a U/10 and understand the steps that are required to be done post termination"

Can you please elaborate steps that are required? What options to choose while filing unemployment: 'laid off' or 'fired'? What to answer if one is asked reason of getting fired?

Anonymous said...

I got a U-10 last September, stressed myself out to the bone, ended up in hospital. I'm not being utilized correctly so certainly feel that I am being set up to fail so it was no surprise that I "failed" the PiP. HR met with me on December and politely informed me that the best option was to look elsewhere.

Got my mojo back after Xmas and have been more direct in telling my boss what I will and will not do. I fully expect the chop but I am certainly not going to make things easy for them by Quitting. Absolutely not. I still hope that they will do the right thing and say "you've been a good employee all these years but the skills don't allign so we will lay you off" but am fully aware that the bean counters run Microsoft nowadays so have accepted that it probably will be a termination.

My 1 on 1s are a blast -- I'm sure my manager was expecting me to have quit by now -- but I just smile and look him in the eye as I talk to him.

I think of it more like an upcoming dovorce. If MSFT wants the younger model who'll gladly work 60 hours +, then I'll gladly move aside when he pays me my alimony :) Until, I'm not going anywhere. Quitting for the sake of pride is stupid -- unless you have another gig coming

Anonymous said...

Can you please elaborate steps that are required? What options to choose while filing unemployment: 'laid off' or 'fired'? What to answer if one is asked reason of getting fired?

You must of course answer the questions truthfully. If you choose 'left voluntarily', they will send a whole big packet of papers to make you explain the circumstances of your voluntary leaving (even if the truth is, you were given the choice of leave-or-we'll-fire-you). Since MSFT isn't 'officially' doing layoffs, if you didn't leave 'voluntarily', you would have to say 'fired' and explain the circumstances.

When my husband filled his out, he wrote that he quit 'voluntarily' (because his other choice was to be fired and he didn't want that on his record). The employment termination document he signed said 'voluntary'. However, MSFT reported to the UE that they'd terminated him (after promising him they would not say this). The Unemployment Office determined that the 'termination' had not been for gross misconduct and thus he qualified for Unemployment Insurance.

I suspect MSFT automatically tells the Unemployment Office the same thing about everybody unless it's gross misconduct.

As for signing up for COBRA, it's a lot like poking around in a mud puddle with a stick, trying to find a lost object. It's a miserable process with very sparse instructions to go on. Just make sure you read and keep every scrap of paper you receive from either COBRA or the Unemployment Office.

Anonymous said...

Team, I am your Microsoft Enterprise Field Sales guy making $400K/yr moving our stuff into Enterprise Customer's environments–level 65/66 client guy. We have a great story with BPOS, Azure, Office, Windows 7, Lync, etc. If we execute, we kick ass and pay some bills around here. The game is still on in the Enterprise. Hold your head high. We are in a position of strength. However, I am also a professional apologist for our lousy consumer situation. My $.02 is that the guys at the top are MBA widget counters (KT, Ballmer, etc.); they are not visionaries or innovators. So they count our widgets and our profits and are happy and pay themselves. Then, if something comes along that is disruptive they go after it, spend the Billions and over time try to win (e.g. XBOX), playing defense while figuring-out the offense. Take the LOOOONNNGGGG view, they say. The fundamental flaw is, the Innovator’s Dilemma is, that we are LATE to everything in the CONSUMER space, so we are now becoming irrelevant from the edge into the Enterprise, which historically has been “the air we breathe” via the Windows desktop OS franchise. What you see now is that the node-OS is becoming irrelevant. Customers don’t care about Windows, Android, iOS, BB, Chrome or any of it. Windows means nothing to them. The apps do, and the ease of use does – Apple is leading the transition from OS to Apps, and user experience; people are moving to that paradigm. So, after missing iPod, missing iPhone, missing iPad, our leaders are now going to tank the Windows desktop OS, unless they do something amazing, soon. Hardware partners don’t care about Windows in the emerging device space. They only care about it to sell clunky PCs at Costco which pulls through crapware, and boring staple corporate PCs which leads them to service contracts and high-margin power cords and accessories. Hence, in my view, the Windows desktop OS franchise is the next big flop from our execs: We aren’t wildly innovating in the personal computing paradigm. We are too complex & rigid to be elegant and it is costing us. We want to make one widget and license it to 400 million users, at a fat profit. But without apps and hardware and elegance and ‘wow’ we confusing, boring, complex and irrelevant. Google is threatening the widget business on top of it, via Android. All of my friends who are in sales and saying let’s ride out the money until it dries up and then move on - we are mercenaries anyway. But, there is no denying that some of our stuff is selling very well (Exchange, Lync, SharePoint, Windows Server, SQL, CRM, etc.). The big key is Office – if you can sell the value of Office to a customer, then you know you are winning the deal. You can try to sell Office directly on its merits and you will probably lose the sale since few care about it. But if you sell Office as the GUI to BPOS, SharePoint, Lync, Exchange, etc., and the customer buys into BPOS, you are on fire. If you can win the concept that Microsoft can singularly offer the Enterprise the way to improve the productivity of that Corporation’s collaboration, creativity and innovation, you can’t lose. But the node-OS – they don’t care anymore – the hardware and app model isn’t there to make them take notice of our node OS. In fact, these Enterprise Customers want our productivity apps ported to iOS since that ecosystem is more idiot proof for their users. But until the money dries up, and the game is no longer on, I will carry my funky Windows Phone 7, my Zune, my PC (and my companion iPad) and keep fighting the good fight. We still have a lot of cool stuff customers want in the Enterprise, but these same customers are searching for ways to obviate parts of our business since we aren’t giving them a good reason to stick with us. Our top brass appear to be setting us up for a real disaster; they can’t fix the pollution Apple and Google are pumping into the air we live on. They are widget guys, not innovation guys, and the monopoly money party could be ending in the node-OS space.-Mercenary #1

Anonymous said...

Can you please elaborate steps that are required? What options to choose while filing unemployment: 'laid off' or 'fired'? What to answer if one is asked reason of getting fired?

The steps are pretty simple. Here is a kind of checklist which other posters have mentioned frequently --
1. save all your emails regarding performance in case you need them later.
2. make a backup of all your work regularly since you never know when the axe is going to fall.
3. Get all routine doctors' work done, physical checkups, glasses etc.
4. On the day the axe falls make sure that you confirm with the HR person that you will be eligible to get unemployment AND you will be eligible to work at Microsoft again as an FTE or as a contractor.
5. When filling out the Unemployment benefit forms mention that you were fired, but also add that you were terminated because you were not a good fit for the role. This is most probably the reason that HR will indicate for your firing.
6. Normally Microsoft does not offer any serverance at all, but if they do then make sure that you read the fine print carefully. Sometimes in exchange for money they might require that you never work at Microsoft again.

There are always contract roles and MS is eager to hire former FTEs as contractors since they require less training.

Good Luck!

Anonymous said...

COBRA?? sorry if asking something stupid.

Anonymous said...

I'm the U-10 original poster who has been waiting for the ax to drop since last September.

I guess for legal reasons MS sees it necessary to drag this process out but it seems so counter-productive. If they came to me last year and offered me severance so I could look for another job, that would have been fine and it would have been a Win-Win. But instead we have this insane dance where I don't want to be there and they don't want me there and one is waiting for the other to blink. It just seems so darn inefficient. I guess they are assuming that I will just quit and I guess enough people do that it makes financial sense for them.

But this is such a ridiculous situation. I no longer have any skin in the game so I'm just doing the bare minimum and not a bit more. Writing my last MYR was a joke. I was tempted to add a Commitment that said "Will get laid off with dignity" :)

If someone gets a U-10 in September is it typical that they get canned during the next MYR? Or does it drag on till the next review in September?

Anonymous said...

Hey, while we're on the topic of COBRA, how possible is his scenario?

You get a new job elsewhere, take their health insurance for self and spouse, but COBRA for child.

Anonymous said...

"If someone gets a U-10 in September is it typical that they get canned during the next MYR?..."

I believe there are multiple dependencies as to whether you're canned and when - regardless of performance.HR has to be careful to manuver around these legal technicalities. Are you a protected class? (Race, Age, Disabled, etc.),or are an anomoly in a group (age 50 in a group of 30year olds)or did you take a protected action in the recent past(FMLA, EEOC, Whistleblower, mention discrimination to HR recently - words like "unfair reveiw" HR ignores despite how credible your proof is - if you think you're being 'discriminated' against, say it.) All of these items can remarkably slow down your being pushed out the door.
You are right to stay employed until something better comes along or they actually fire you. Quitting will make unemployment harder to come by, or you'll have to fight for it, pay COBRA sooner, and most possibly be denied unemployment. All requests for previous MS work history go through third party agencey anyway, so whether you quit or get fired - same result to next employer.

Anonymous said...

"Alright Mini: time to take your lips off the Kool-Aid jar and send out another post! Earnings are out soon!"

I wish we didn't all post anonymously just so we could see posters eat crow once in awhile. However, what's with the 4 year treand where beating expectations leads to a stock price drop and poor results resulting in a bump? Is the hunger for restructuring so strong on Wall Street that bad news is promising?

Anonymous said...

If someone gets a U-10 in September is it typical that they get canned during the next MYR? Or does it drag on till the next review in September?


It is hard to say how things are playing out these days. In FY10 things moved fast in the Windows Division as they wanted to get a significant percent (20%?) out to make room for new people as attrition was non-existant.

In my case, I got put on the U10 train in the Mid year, U10 in sept and was canned by next years Mid year.

Later on I heard from folks in Windows that this was causing "morale" problems and they slowed on this practice. But every time has to provide the 10-20 headcount and it is left to the president to determine how long they want to keep these folks.

Good Luck to all with the Mid Year finishing up!

Anonymous said...

DevDiv is having "overnight" team building at Tulalip Resorts on 3/31-4/1 even though the division is still walking folks out the door. Unbelievably out of touch!

Anonymous said...

"I wish we didn't all post anonymously just so we could see posters eat crow once in awhile. However, what's with the 4 year treand where beating expectations leads to a stock price drop and poor results resulting in a bump? Is the hunger for restructuring so strong on Wall Street that bad news is promising?"

It's a 10 year trend, not 4, and it's called the Ballmerization of Microsoft. He needs to go head-up Wal*Mart or the like and get the hell out of tech.

Anonymous said...

You get a new job elsewhere, take their health insurance for self and spouse, but COBRA for child.

This is what I did..

Anonymous said...

Noticed how Lisa swings left and right while she's talking and how cameraman tries to follow her, and how nervous she is?

Anonymous said...

"1-5 scoring system, only reverse this time."

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