Why data-caps SUCK

Brian sez, "I made an animated presentation about broadband and mobile data caps - specifically, how they discourage innovation, how the excuses used to justify data caps don't hold water, and the real reasons that ISPs and mobile providers are moving towards caps."

This is really good stuff. It might need an edit for time, but if you've got 11 minutes, this is what you should spend 'em on.

Why Data Caps Suck: The Animated Examination (Thanks, Brian!)


    1. It’s why I visit mostly american websites. All those extra ‘u’s in British and Canadian websites really add up, especially if they’re in bold.

  1. The absurdity is that I get a discount for my internet service by subscribing to basic cable that I don’t even have hooked up to a TV because I have the internet hooked up to my TVs.

  2. This move towards charging for electricity based on usage will stifle innovation, and cause doubt every time the consumer thinks about turning on a light switch or firing up the microwave. Wait I think I got something mixed up…

    Internet access costs too much, it’s true. There is too little competition, it’s true. That doesn’t mean charging per GB is inherently a bad thing, it’s just that the current implementation by the oligopolies is a bit evil. I should have to pay more because I torrent (and take up much more steady-state capacity) than my parents, who just read a web page now and then.

    1. First off, unlike ISPs, the electric company doesn’t charge a substantial monthly fee just to be eligible to receive electricity; you pay for what you use, plus taxes and fees, unless you’re on an estimated plan or the like.

      Second, the electric company doesn’t suddenly increase my cost per kilowatt-hour, simply because I use a lot of power.

      Third, the electric company doesn’t bitch at me if I use power exactly as fast as their lines deliver it to me, as long as I don’t blow any circuits.

      ISPs complaining about overuse of a product where they have [i]complete[/i] control over delivery, when it’s outside your house walls, rings quite hollow.  After all, as the animation above suggests: not only is the network automatically load-balanced, they can always simply scale back ALL connections some set %; those who are using more bandwidth will see a much larger amount of slowdown.

      Yes, of itself, there’s nothing inherently wrong with paying by the MB/GB/whatever.  But I guarantee that it will ALWAYS be abused when implemented, just as it was in the past.  Anyone remember CompuServe?

      1.  Also the electric company is NOT continuously promoting and selling me products that use more electricity than they used the previous year. The ISP’s are putting a lot of money into delivering HD video and streaming music.

    2. This argument has merit in a debate, but not in the real world. Stop the Cap! has been exploring and fighting data caps since the summer of 2008 and helped coordinate a successful repeal of a cap experiment by Time Warner Cable in 2009. We have absorbed all sides of the argument to better understand different views and have come to the conclusion data caps are really about monetizing broadband usage — nothing more, nothing less.

      The original argument for caps was congestion relief. But with fiber and DOCSIS 3 upgrades, there really is no congestion issue on wired broadband networks if carriers spend reasonable sums to manage their networks. We recently learned Time Warner Cable has a 95 percent gross margin on its broadband service. It costs the company next to nothing to provide broadband on already paid-for infrastructure, for which it reaps fat profits. They have no congestion problem or even flinch about traffic growth, because the costs to deliver the service on a per customer basis have plummeted, even with traffic spikes. The exact same thing is true for Verizon, AT&T, and Comcast.

      A truly metered system where customers pay for only what they use is not objectionable to us, but no carrier will dare offer it because of the devastating impact it will have on ARPU — the average money collected every month from each customer. Instead, providers want to charge the same (or slightly less if you accept draconian caps) they do today -and- impose caps and overlimit fees. So no “pay for what you use.” Instead, you end up with an allowance and monthly price that guarantees today’s profits are well-protected and you are inconvenienced.

      A gigabyte of traffic today costs most major ISPs pennies at most. But many seek $1+ per gigabyte in their overlimit fees or charge for a huge additional chunk of allowance costing $10. That is all gravy.

      We have a usage-based pricing system in place today: speed-based tiers. That customer who reads a web page now and then can buy a “lite” account with slower speeds that work just as well for web browsing and email. Providers under-market these except as a retention tool.

      You are already overpaying for your broadband account with unlimited access. Now providers want to implement ways to charge you even more. Don’t be their sucker.

      Phillip Dampier
      Editor, Stopthecap.com

    3. Do you get a certain number of kilowatt hours per month, after which you’re charged an exorbitant rate per kilowatt?

  3. This video is a little bit deceiving. I’m from Australia and data caps are common. 

    The video rightly points out that the main issue driving costs is the number of users using at peak times. That is why in Australia there is ‘on peak’ and ‘off peak’ caps so that when the network isn’t congested you can use more data. This gives people an incentive to torrent in the middle of the night, reducing the need for peak capacity which reduces the cost of providing the service for consumers. In a competitive marketplace that is going to lead to cheaper prices. 

    The second misnomer here is the idea that data usage isn’t a good way of measuring strain on the service. The video claims that the number of users is the big factor without pointing out that heavy users are on all the time. So a light user might use their service a lot less than a heavier user who is spending hours and hours torrenting, and therefore they add to congestion less. You could come up with a similar metric “amount of hours used of internet” but it’s a lot easier to simply measure data throughput. 

    At one point the video suggests that if the ISPs were worried about congestion they’d try and get people to buy less internet. This is ridiculous. They want to increase revenue from customers so that they can fund more improvements to the service and make a profit. If they have less customers with less revenue they’re not going to be able to upgrade the service. 

    I’m not saying data caps are great, they’re ok. As long as they’re instituted fairly with a system whereby users get slowed after they go over their cap without incurring fees, they’re a pretty good way of ensuring that the users who use the service the most pay the most. That seems eminently fair to me. 

    The basic fact that this video ignores is that users who download lots tend to also use the service for long periods. That causes congestion. There’s nothing wrong with making heavy users pay more. 

    The real problem here is that you don’t have a competitive marketplace. Fix that, and forget about everything else.  

    1. Also, you don’t have to use TCP on the internet. Torrents, for example, mostly don’t. It’s not a good strategy to rely on all the clients being nice to each other. One could for example use an unfair web browser that repeats the timed out requests faster than the standard suggests. 

      I agree with Jonathan. Billing the ones using more of the service sounds fair. And the video didn’t really propose any alternatives. Should all the users pay the same? This would certainly require light users to pay more than they do today. 

      1. Your point that the video ignores non-TCP traffic (which is certainly a non-trivial proportion of all traffic) is perfectly true, however most BitTorrent traffic is still TCP-based and illustrates another major failing in the video’s explanation of how bandwidth is allocated: the video draws no distinction between users, applications and connections when claiming everybody gets their fair share of bandwidth.
        In fact, the bandwidth is shared between connections, so, for example, my BitTorrent client, which is set to use up to 240 TCP connections, is more equal than others.

      2.  I’ve got an idea! How about they bill people based on speed, and then limit them to that speed. That way, there’s a guarantee they can offer service to everyone on their network by simply having enough capacity to handle the given speed.

        “Light” users could buy a lower speed and then, if the ISP has spare bandwidth, they could generously let them use more, likely during off peak hours.

        1. Limiting the speed instead of the volume might be for two reasons:
          * With a volume limit, people are able to enjoy a better internet experience. To effectively fight network congestion, they would probably need to reduce the speed quite a bit. 
          * “Powerusers” might just buy a cheap, slow contract and load data 24/7. This also wouldn’t help to fight congestion.

          I’m not talking about broadband internet at home, but on mobile. Once the mobile network has enough capacity reserve, speed limits will definitely be the way to go. But as things are right now, without volume limit the connectivity would probably be as worse as in Manhattan at many more places. Imagine people would cancel their home contract and go mobile only for all their internet needs. The network couldn’t handle it. 

          For now, I’m just happy they stopped billing me by the minute and there is only one metric I need to keep in mind (only the used data, not the place where I used it or when I used it). Lets hope the marked keeps evolving. 

    2. Why the hell don’t mobile providers here have peak/offpeak hours?

      And why are the peak/offpeak hours so dumb (iPrimus’ offpeak was 2AM-10AM; everything else was ‘peak’. stupid.)

      Last line: true that.

    3. Australia and other nations in the south Pacific are a special case. You have data caps primarily because of international connectivity capacity restraints. Unlike North America, Australia and New Zealand send a huge amount of their broadband activity through limited capacity underseas fiber cables. With this bottleneck, ISPs implement data caps at times they assumed would generate the most traffic, but removed them during the overnight hours.

      Torrenting is no longer the primary factor driving broadband usage. Online video is, at least in North America. Torrenting created issues primarily for cable operators using DOCSIS 2 technology because torrent traffic can consume the maximum amount of available bandwidth to move bits back and forth. Since cable ISPs rely on shared last mile infrastructure, a few Torrent fans in the neighborhood had the potential of degrading service for other customers. This problem has been resolved with DOCSIS 3 and a growing trend away from peer to peer. Customers are now using broadband more for one-way online video streaming, which has less impact on upgraded networks, but may require additional capacity from the ISPs bandwidth supplier.

      The Australian government sees the Telstra-dominated marketplace of caps, throttles and limits as a major detriment to the country’s competitiveness in the digital economy, so the government is building its own National Broadband Network to replace copper infrastructure and deal with capacity issues.

      Consumers hate data caps and the government has listened.

        1. Yeah, I got what you meant. It’s just that it seemed to me a more natural way of putting it would’ve been ‘too long, didn’t watch’. So I went all Katzenjammer (‘didn’t vatch’) on yo ass! (I own a long chain of misfired quips).

    1. Brian Boyko definitely has an interesting voice and it’s fun to listen to him speak. I’d say he sounds more Patton Oswalt or Daniel Johnston than Kermit, though.

    2.  Did you guys have garbled gibberish text popping up every few seconds at the beginning in the video on the bottom of the screen?

  4. While I hate caps, Brian ignores a central problem: bandwidth costs.  Before, ISPs could over-commit on their central bandwidth without much issue.  Explosive growth in internet service subscribers has meant more bandwidth is needed into ISP data centres, more leased lines. In the UK this is especially difficult as unless you want to install all your own kit into BT’s telephone exchanges, you essentially have to buy leased lines to BT to get the connectivity to your customers.

    Over-commit is the issue.

    1.  They promised what they couldn’t deliver. Most people would see this as a problem. Not ISPs, though! No, they see it as an OPPORTUNITY!

  5. The elephant in the room is that ISP’s almost never provide the bandwidth they promise. And if you complain they have a toilet roll list of excuses to shut you up or shut you down… take your pick.

    1. This. Obviously sometimes my download speeds are sometimes limited at the server end or the uploader’s end. But otherwise, I ought to receive the stated “up to” speed. If my ISP is not capable of providing that stated speed to the people subscribed, at the same time, it should not be allowed to sign then up. If it is able to do so, then there is no non-rent-seeking reason to have a data cap or overuse charge, because running a network doesn’t cost “per GB.”

      1.  Admittedly it’s been a few years but the last time I was involved – yes – it does cost per GB to run a network – at least at the peering level you pay to hook into a peer relationship if your data volume is uneven – this is all in a contract.  So yeah if you host enough stuff that you send as much as you receive then you are typically able to peer for free – however if you are just a major straw you do pay for bandwidth to maintain your network. 

        That isn’t true for all network – or for most internet connections – however it does happen in the network world – just because you’ve never been exposed to it doesn’t mean it doesn’t exist. 

        I will add that the costs to the metered traffic were *always* going down.  If you lookup costs of web hosting even now you will see data caps (4-8 TB a month) and some offering ‘unlimited’ bandwidth – but those ‘unlimited’ sites would just cancel your service if you tried to run a big site on them – they aren’t going to host facebook for $100/mo – bandwidth does in fact cost still even if it’s cheap.

      2. What you think you want is uncontended bandwidth, but when you find out how much it actually costs you may change your mind.

        1.  If it costs to much to offer, maybe that’s what they should start advertising? I wouldn’t mind seeing legislation forcing them to be able to advertise only “guaranteed” speed – especially since the speeds they DO offer are utterly meaningless.

          1. Lucky for you, guaranteed speed is available! It costs just a couple thousand bucks or more up front to get a connection to a tier 2 ISP. Then, with a minimum commit of about 50Mbps at $10/Mbps, you’re good to go for only $500 per month! Of course, with 95th percentile billing, if you use more than that amount of bandwidth for 5% of the month, you’ll pay overage charges, so be careful! Good luck!

        2. So is the peak speed they advertise, then, the speed I’d get it no one else was using the network? What limits that? That number comes form somewhere, but I’ll be damned if I know where.
          Also, guaranteed bandwidth of, say, 5Mbps: probably not that much more than I’m paying now, especially since we in the US pay more and get less speed than most of the world.

      3.  Reminds me of my university. 1,500 parking spots on campus, 4,000 parking permits sold (at several hundred dollars a pop). In response to complaints that there was no parking? “Get here earlier and you’ll find a spot.”

        Flawless logic, there…

    2. Frankly, most of the time (on Comcast), I receive somewhat more bandwidth than advertised.  For instance, I’m on a 15 megabit plan currently, and regularly see 22-24 Mb. This has been the case in 3 different locations, one in a completely different state.

      *shrug* I’m not trying to excuse Comcast, they ARE greedy bastards, and I agree with the premise of the video, but I can’t agree with them “almost never” providing the bandwidth they advertise.  Hyperbole isn’t going to help the debate.

      Underperfomance certainly does happen at the ISP level but more often is really a user-side issue. For example, Windows (all versions to date) does NOT use the proper TCP/IP settings for broadband; try running TCPOptimizer (free, found at http://www.speedguide.net), and see if that helps.

  6. The real problem is, bandwidth isn’t provided free by local government.

    Networking is essential infrastructure like water, sewage, and roads. Leaving it in the hands of the former lords of the mass media age seems almost negligent. The economy can’t grow if the network doesn’t grow. And no matter how much bandwidth we use today, it will need to double tomorrow. It is driven by Moore’s Law as much as anything else.

    Some research suggests that we only fully explore how to use media if we are free to waste it. An example: browsing the web while audio conferencing with someone on the other side of the world. It is traditionally a very expensive phone call. But over the internet, you are free *not* to talk. You can ‘waste’ bandwidth. You are free to behave as if you were occupying the same room, rather than trying and failing to have a natural conversation via long distance telephone call, which is such a poor experience that it’s best avoided entirely. In contrast, over the internet, the call can be a very relaxing experience. The media is not terribly different. The way it used – based on the way the service is charged – is utterly different. One succeeds. One fails.

    In the UK, I have a 60GB cap on a 20Mbps line. The cap is generous enough it doesn’t modify our behaviour too much. Unmeasured after midnight. Not thrilled about the cap.

    1. Moore’s law dictates that computing power will double. It doesn’t dictate that computer requirements will double.

      A 3 Ghz quad core chip takes the same bandwith to IM as a 1Ghz Pentium III.

      Using free unlimited bandwidth, I still don’t want to extend video calls, because it just feels awkward.

      The difference between bandwidth and water/roads/sewage is that literally every person uses these three, in roughly similar amounts.

      Bandwidth isn’t like that at all: some people bittorrent all day and could chew through 1TB a month if they wanted to. Many just check emails and news and such and use less than 1GB. Some still do not use any, or only use mobile data. It would be really unfair for many of them, and would encourage a ‘tragedy of the commons’ effect in a way that free water would not.

      1. Literally every person uses roads in roughly equal amounts? Seriously? Haha. But yeah, no. That isn’t even remotely true.

        Nor, for that matter, is the water thing.

        I haven’t looked into it, but I guess at least for normal folks the sewer usage would be similar.

    2. Some research suggests that we only fully explore how to use media if we are free to waste it.

      By “research suggests” you mean “Venkatesh Rao made this observation on his blog,” right?

  7. Huffs fingernails, polishes them on shirt.  “Data caps?  What’s that?”

    /l love my ISP.  No caps, Fiber, only one or two ports are blocked (no, port 80 isn’t one of them), they don’t care what you do with the connection.  Well, unless it’s illegal.

    //Don’t use your cable provider as an ISP – they view your heavy use (for Internet TV) as competition.  Use either an ISP which only provides Internet service, or use common carriers.

  8. If I wasn’t pretty damn sure that most if not all congress critters were bought and paid for by lobbyists, I would say this should be required viewing for them. Because I’m also fairly certain that most if not all of them think the internet is a series of pneumatic tubes, so they could probably use the TCP/IP refresher ~.~  

  9. The solution, it seems, is simple.

    Keep data caps. They have a purpose. If everyone is running Torrents 24/7 downloading complete seasons of TV shows they never even watch, the casual users get screwed and the whole thing breaks down.

    However, alongside the data caps, keep a real time monitor of usage, and use that number to change a multiplier. At peak times, the multiplier is 100%. Off-peak, it goes down substantially. Maybe at 3AM the multiplier is 5%.

    Let this number be easily known to every user of the network, either Android widget or just a web page.

    This would have the natural effect of discouraging congestion, respecting the limited nature of bandwidth, while still letting people use surplus bandwidth freely.

    Not sure how workable this idea really is (considering the Internet is globally connected), but within the realm of localities and individual ISPs, it seems like a great idea.

  10. I know that with Comcast, the reason given for a 250G a month cap (the enforcement of which has been suspended for some time now) was because if you had a neighborhood full of people doing high bandwidth things all at once, that would slow down the internet for everyone.  It used to be that in the last few weeks of summer vacation and the first few weeks after Christmas, the internet speed at my den was ridiculously slow, as slow as 0.5mbps due to people doing high bandwidth things.  Thankfully, Comcast has put a lot of effort into upgrading their systems, slow internet in the evening is no longer an issue and the cap is no longer enforced.

    1. Wish my Comcast experience was the same. Definitely have slow down in the evenings. The holiday was super slow, too.

  11. The equal-allocation-of-shared-bandwidth argument is a little disingenuous.  If you and I share a pipe, then when you the casual user jump on to check your email, sure, you’re allocated half the bandwidth while you do that.  But if I’m maxing out my portion with 24/7 torrents, that means you will never get the same use of the full bandwidth that I do all the time you’re not checking your email.

    This shouldn’t be of any concern to the service providers, since they ought to be selling x-bps pipes instead of overselling shared bandwidth based on questionable forecasts of user activity.  Imagine if you spent a few thousand dollars for season tickets to see your favorite sportsball team only to be turned away at the gate because the team is unexpectedly doing well and management didn’t think all these people would show up vying for the same seats.

    1.  I’m actually pretty surprised this doesn’t already happen. I know it does for other non-sporting events, where they will sell beyond capacity based on some expected number of no-shows…

    2. Here’s a bad analogy to match yours.

      Imagine you run a nightclub. Some nights it gets really busy and you are full to capacity. Other nights the place is fairly slow. There’s a fairly predictable pattern though – Saturdays are busiest, maybe Tuesdays are slowest. If you graphed the turnout from night to night it would look like a regular repeating weekly wave*.

      Your club is getting popular. Saturdays are getting so crowded that people are complaining. You decide to build an addition to make more room. You go to a community meeting to present your expansion proposal, which includes more parking spaces, architectural plans, etc. Some guy named L_Mariachi stands up and proposes that what you actually need to do is determine how many individual customers come into the club during a given week and build out capacity as if they all showed up at the same time. So instead of basing your infrastructure on highly predictive graphs showing that you will have extra room above peak capacity even on Saturday, you are being told to spend more on capacity that will not be used.

      * Anyone who’s ever looked at a graph of aggregate internet usage for a large enough service or carrier knows what this wave looks like.

      1. You took a bad analogy and mangled it. The nightclub owner isn’t proposing to build an addition to accomodate Saturday night peak traffic, he’s proposing to levy a surcharge on customers (who have already paid the cover and bought drinks) who want to dance or sit at a booth for more than a couple of hours. Ideally, he’d like people to pay at the door, quickly down a couple of drinks, and leave as soon as possible, making room for the people waiting on line outside.

  12. I live in Ukraine and to me this discussion about benefits of data caps (waah! if not for data caps, network would collapse!) looks so bizarre. Maybe I’ve been lucky with ISPs (four since 2005, in two different cities), but data caps feel so outdated.

  13. Every week, there’s a BoingBoing article that reminds me how much I love my ISP. Sonic.net is just plain great. None of that six-strikes crapola, no data caps. Inexpensive.

    1. FYI: Sonic.net only provides service in CA… so far. It’ll be great when they expand, but until then, the other 49 states are just SOL. And I think I’m tired of hearing how great Sonic is in the meantime.

  14.  Can’t watch/listen to the video right now, but I can say this: it’s pretty clear to me that, at least here in Canada (where the data caps are much lower than they are in the US, on average) the main reason for the caps, even though it’s not stated, is that the main ISPs (the ones who own the networks) are also content providers: either they’re cable TV companies who also own their own channels (Vidéotron) or they’re telephone networks who also own their own channels (Bell).

    They really don’t want people to stop subscribing to their TV offerings, because that would mean competing with services like Netflix on an equal footing.  I mean, as far as I know, we don’t even have access to paid Hulu here, and I’m confident that data caps are the main reason.

    The CRTC (the Canadian equivalent of the FCC) really should be more neutral, and force the major ISPs to demonstrate the need for their data caps, or force them to go away except in actual cases of network congestion.  It’s unfair and prevents innovation.

    1. Bell owns more than just a telephone network and channels. They also own the largest satellite provider and in areas where they offer fibre, they offer tv through that. And they own a lot of channels. Both broadcast (CTV and CTV2) and a lot of cable/satellite channels (Discovery, Comedy, Space, MuchMusic, TSN, and more). And a bunch of radio stations. And a big chunk of the company that owns the Toronto Maple Leafs, Toronto Raptors, Toronto FC (soccer), Toronto Marlies (American Hockey League), and the Air Canada Centre. And a chain of retail stores called The Source (formerly Radioshack). Oh, and of course The Globe and Mail.

  15. Data caps impair system security.

    Widows updates, driver updates, software updates, anti-virus updates. Almost everything we have installed on our systems require updating. All those updates are sent out free. But they all count against your data cap, so you end up paying for them. And you pay large if those updates come along when you have reached your “allowance”.

    Data caps impair business.

    Netflix is only $8 a month. But how large are those movie files? Got kids? How about those free games? Star Wars – The Old Republic is approximately 28Gb large and is free to download and play. Unless you have a data cap. SWTOR would cost something like $200+ to download if you have a datacap. Your kids will just have to do without.

    Data caps not only cost us, but they also cost business.

  16. Great video, but I think they missed one of the most ridiculous abuses by these cable/phone companies.  A lot of them basically force you to buy LANDLINE telephone service to get their best/cheapest service.  Is there a more crippled technology out there?!  The fact that someone can almost force you to purchase a dying technology just because they have a monopoly on an industry that leaves you no other choice, is robbery.

  17. I was listening to This Week in Tech a few weeks ago when one of the guests was from Rackspace.  He, of course, is sold on the notion that we’re just going to put everything in the cloud.  We won’t own our own equipment, it’ll just be in the cloud.  Got a bit pie in the sky about how “the cloud” is “unlimited” (it’s still just bits on a storage device that someone pays for an maintains, after all) and how everything from our music to the family photos (straight from the camera to “the cloud”) is the future, but the conversation took a much different direction when the other guests started talking about the cost of transferring that data over the Internet.

    Getting a little sick of the “cloud” circlejerk, myself.  “The Cloud” isn’t some magical land with unlimited storage, bandwidth, and CPU cycles.  It’s a computer or computers, sitting on the Internet, with equipment that has to be powered up, maintained, etc just as it’s always been.  And someone has to pay for that.  Sure, that whole “doing shit costs money” thing stifles innovation.  Duh.

  18. If an ISP’s internal router (or any interface on it) gets saturated to the point where TCP is backing off for all connections through the router, it’s a problem. Someone will get paged, OSPF weights will be adjusted or whatever, etc. It is not the normal mode of operation implied by the video. Capacity planning involves adequate headroom on every node in the network.

    And yes, I’m obviously an ISP shill.

  19. Thankfully, Cable TV companies that sell you digital channels and Internet service haven’t caught on that they neglected to cap the crappy shows they offer otherwise they’d limit our access to “Fox News”, “Dancing with the Stars”, “Home Shopping Network” and “The 700 Club”….Digital bandwidth is digital bandwidth. So much BS.

  20. Charge by speed or charge by volume.  Pick one.

    Oh wait, they’re monopolies so they don’t have to.

    Keep bickering, peasants.

  21. I really wish I paid for internet the way I pay for electricity. Cable companies would still be free to sell me video subscription packages, but they would actually have to compete with each other.

  22. While i agree with the angle of the animation I find that the trend is moving away from limited.
    I have just moved from limited O2 mobile and plus.net broadband to unlimited EE and Virgin cable. I now have unlimited all I need.

    1. I think unlimited mobile is still pretty expensive, but I’m impressed by the price of unlimited broadband.

      In November I blew my 60 gig plus.net limit by 15 gig over the course of three consecutive afternoons of work meetings and not having to worry about the excess use charges means joining meetings from home won’t leave me worrying about cost.

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