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General: S. Korea Tries To Control Gold Farming

In an article at ars technica there is talk about the South Korean Government hoping to pass a law that controls the exchange of virtual currency.

A controversial bill proposed by the Ministry of Culture and Tourism in South Korea aims to control the exchange of virtual currency. Described by the deputy director of the mMinistry's Game Industry Division as an attempt to "tighten regulations on hazardous gambling activities," the bill would prohibit the sale and purchase of virtual currency, but would not impose controls on item trading.



In recent years the phenomenon of gold farming has grown dramatically. As online role playing games with complex internal economies grow, so too do the number of companies that are looking to cash in on these new virtual economies. It turns out that some gamers are quite happy to pay real world money for in-game currency and/or items, and this has created quite a stir amongst gamers and politicians alike.



The South Korean bill has received strong support from some in the game industry, particularly companies that run multiplayer Internet games in which the commercial exchange of virtual currency can potentially disrupt balance and competition. On the other side of the issue are gold-farming companies that serve the growing market for virtual currency. An article in The Korea Times cites statistics from the country's Game Development and Promotion institute, which states that the size of the virtual item exchange market is roughly $1 billion and estimates that approximately 60 percent of item trading company profits come from gold farming.



As gold farmers are quick to point out, prohibition will not decrease the market for virtual currency, and somebody will always emerge to take advantage of it. Prohibition, anyone? By imposing penalties on virtual currency exchange, the Korean government will deprive native companies of access to a rapidly growing, $1 billion dollar market that will still be serviced by foreign companies. Many MMORPG developers already have policies forbidding the commercial exchange of virtual currency, and some might question if it is fair to the tax-paying public to shift the costs and burdens of enforcing those policies to the Korean government.



The bill is also relatively vague about what actually constitutes virtual currency. One wonders if this proposed prohibition would criminalize games like Second Life in which commercial transactions are a fundamental aspect of the experience.



As usual, this is probably a case of overly-concerned politicians trying to control what they don't understand. As a result of the growing controversy, the bill has essentially stalled while the debate continues. Like most other sectors of the technology industry, gaming is versatile and dynamic--a combination that makes it difficult to regulate. As trends change, anachronistic laws can become impediments that stifle progress. In order to prevent stagnation, Korea's legislators may have to depend on the invisible hand rather than an iron fist.


Read more here.

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Comments

  • SenuvenSenuven Member Posts: 51

    Nice article.

     

    I played Lineage 2 where the farmers own the economy. It is not only Korean, but alot of other asian and european companies.  People will always buy and sell the in game currency,  If it is shut down one place, another opens. Some people even think games like Lineage 2 make money from the people farming for protection from the mighty Ban hammer. if the farmers are banned, they will get new key codes and start over.

     

    I dont personaly feel that the virtual currency sellers would be hurt by this at all. Customers might though.

     

    At the end of the article, I think the whole paragraph is right on point. The games that make money off of it are not taxed, and this law could hurt them. The farmer companies wouldnt be to hard hit by it. But give them an excuse to raise the price, and you will see prices go up like the US Gas prices.

    To error is human, to forgive is devine. Neither are US Marine Corps doctrine.

  • CastorHoSCastorHoS Member Posts: 54
        This really should not come as a surprise to anyone that has ever played a game where currency farming has ruined an in game economy. The economy gets ruined and the game falls apart.





        Lineage II outside of Asia is a prime example.  There is no actual economy in it anymore. It is a haven for 50000000 dwarves with names like abcabcabc or xoxoxoxoxox to run around and farm while driving off any actual players.

        I have always asked why a gamer should be able to profit from a game they do not own. If you go out and try to resell music, books or anything else that someone else has rights on and if you are caught you are going to be paying fines. The difference, and this is the only difference, is simply that online games are only just approaching financial success that allows the companies who develop or publish them to carry enough weight that laws are able to be put in place to cover areas that have never been covered before.

        Mind you there is a place and time for selling of in game currency but it has no place being done by an outside group of people with only profit in mind. The company putting out the game and able to adjust what, when and how much you can buy and gauge it by the shape of the economy in the game should be the only way this should be done.

       



        For anyone who says that others will pick up where another company gets shut down........Keep this in mind. If someone has to purchase a new cd key every time they get an account banned or they lose a lot of accounts because an entire credit card or something else that links all the accounts together is banned then it will get to a point that they are losing money over any profit they try and pull in. No company or group of people will stick around when that happens. Just as is cheating or anything else within an online game, if you ban enough of them or companies take enough of them to court and you will see less of them to the point it is no longer a problem on a scale like it currently is.



       
  • DrowNobleDrowNoble Member Posts: 1,296

    About time some government decided to do something about this. 

    I don't think it will stop gold farming, but it's a start.  If more countries passed laws against this then companies would have a better legal ground to stand on.  Kudos to South Korea for this legislation! 

  • HejietHejiet Member Posts: 49

    Sadly I can only refer to WoW has my gaming experience with the problem.

    There was a big clean made a couple of months ago, and I don't think it changed anything really, beside I know the prices went up quite  a bit.

    Also, it amazes me when I see shouts and messages on General Chat from gold sellers. I mean, how can they even allow people to shout such a thing in public? I do believe that those account should be ban on the spot that someone get a good screenshot and report it. No questions asked.

    I was tempted once to buy gold as well, considering I was going to school and had a full time job, didn't have much time to grind gold, and buy it was cheaper than the time comsumption from grinding, although I didn't because I knew that somehow I would be exploited this way. I really think that all those that consider purchasing any kind of in-game currencies should consider it twice, and think about where it comes from, and what that kind of transaction doesn't to the game they love.

  • TaeraTaera Community ManagerMember CommonPosts: 1,078

    When I get that helmet I've wanted for 10 levels, and finally put it on for the first time, I feel proud.  I earned that helmet, whether through DKP, hours of saving my platinum, camping the named that drops it...if I just paid 5.99$, I don't think I'd feel half that satisfaction.

    Laura "Taera" Genender
    Community Manager
    MMORPG.com

  • SenuvenSenuven Member Posts: 51
    Originally posted by Taera


    When I get that helmet I've wanted for 10 levels, and finally put it on for the first time, I feel proud.  I earned that helmet, whether through DKP, hours of saving my platinum, camping the named that drops it...if I just paid 5.99$, I don't think I'd feel half that satisfaction.



    Exactly, and it comes down to the people playing. The ones behind the monitor, be it the full time student, a person who works alot of overtime or someone who just like to game, they all derive their satisfaction from the game they pay for to play differently. I know when I made my own gear, I was showing it off to everyone. I farmed the materials and the money, and I worked hard.

    With the asian MMO's you work hard, and most of the time get little reward. It took me several months of attempts to make armor that only had the option of 60% success. If it failed, back to square one. In Lineage, if you dont buy adena, you cant succeed. That is why they dont get my 3 accounts worth of subscriptions anymore.  In the Asian MMO's 10 levels of farming at high levels takes a very very long time.

    To error is human, to forgive is devine. Neither are US Marine Corps doctrine.

  • ReklawReklaw Member UncommonPosts: 6,495

    Great articel and do hope more to come and that gamedevelopers really start to listen to the hurt that is brought into their games.

    Goldsellers/spammers/buyers have no place in a gaming community,  because they have a hard time playing a game they truly that sad to just ruine the game purely cause they can not play the game.

    Every single person that ever had bought gold should consider him/herself a cheat and unable to game the way the game was ment.

    Does someone know how to contact : PharmaMaster, i do not like the spam he/she sends but i would like to contact this person so that he/she may spam all those goldselling sites as what he can do is pretty destructive( to bad this person uses his smarts to do harm against those that trying to do good, maybe he wakes up one day and understands that because he/she is that smart to terrorize a company, he might be able to do some good instead of bad and that is towards godlsellers:)

    Here is a articel about this person: http://www.securityfocus.com/news/11392

  • damijindamijin Member Posts: 37
    There are several things wrong with the responses in this thread.



    Kudos to Garrett for bringing up the news story but... it really means nothing! Korea has hinted at possible legislation of virtual markets before, but it hasn't gone anywhere yet. This one is just a knee-jerk reaction, made over some huge online gambling fiasco/conspiracy over there, and now all of a sudden they're on a witch hunt to regulate. But they have no idea how to do it properly, and it seems likely to me that it will not happen.



    Not yet anyway.



    But, to address you people in this thread, specifically the two first posters with their anti-L2 slander.

    You need to understand something. Farming is one of the cheapest investments you can make. For the price of a cd key (can be as low as $5 for a key to North American L2 in China), and a few time cards, you have the potential to make hundreds or thousands of dollars. It's a micro investment for a relatively large profit. It fits their economy so perfectly. You CANNOT ban them enough and make them go away. The investment to profit ratio is just far too rewarding. Pushing them will just make them smarter, more careful. It'll eliminate the smaller, more casual shops in China, and leave the RMT industry firmly in the hands of those willing to play dirtier. Like Garrett said, prohibition. It doesn't work in real life and it won't work in the virtual world.



    And how do you have the nerve to say Lineage 2's economy is dead? Lineage 2 has a thriving and vibrant economy. Players and farmers co-exist, and each stands a chance to make money. Maybe you just didn't understand how to play the economy, it's not simple like an auction house. It takes effort, and it's actually phenomenal for it's ability to function with farmers or with out them. I don't know how you can have bad things to say about an economy where prices of items is constantly fluxuating, meeting and experimenting with market demands. But I'll just assume you didn't have enough money at whatever level to afford the best gear that you needed, and you assumed that the sole blame was farmers making things too expensive.  In actuality, L2 is just not an easy game where you can have nice things without trying hard or getting help.



    There is no solution to RMT or gold farming, you cannot fully take away something that a man is willing to pay hard currency for. You can push it further and further underground, until the only people left in the business are really the people who are willing to steal your account, your gear, and your personal information, because that's the only way they can make money. Or you can leave it how it is, and adapt around it. There are ways to design games that allow farmers and players to co-exist. There are also ways to design games that discourage or lessen the advantages that purchasing gold will give you. These will be coming to light soon, so just be patient. In the mean time, don't encourage any governments to do anything stupid that you're going to regret down the road when you're closing all your credit cards and trying to rebuild your life after a nice case of identity theft. Really, RMT doesn't hurt you that much.
  • bakakakabakakaka Member Posts: 12
    maybee removing the ability to trade money with other players can be a good idea? =)

    it would remove beggars and farmers and scammers, and all would have to work for their money.
  • ReklawReklaw Member UncommonPosts: 6,495

    Before releasing a game put out a beta for farmers, see what the amount they would bring in for lets say a day and make that a max currency every player could get a day, if you want to have a succesfull econmy i think this would be the way, in real life "most" people earn the same amount each day, it would be wierd if someone at the same job would make 100x more then you do at the same job, why is this so hard to achive in games?? wouldn't this ban or atleast stop goldsellers/spmmrs/buyers as they can not get more then the max amount given to them a day to reach.

    Goldsellers/spammers/buyers are bad for the econemy regardless what other people say, if they think it does not hurt they might need to look for something else then online gaming as they probebly never can and never will be a real part of the gaming community

  • damijindamijin Member Posts: 37
    The damage farmers do is honestly debatable in my eyes.



    Before farmers existed, there were still problems. There were uber clans who dominated raids and dungeons, and often times they actually sold gear on ebay too! This was all before people from lower income economies, like China, got involved in the industry.



    Farmers, in general, try not to have an affect on other players in day-to-day gaming. They don't want to bother anyone and don't want to be bothered. They do one thing, increase the amount of currency within the game system. MMO economies are designed for inflation, the faucet/drain economic system accounts for inflation, it has to! All farmers do is accelerate that inflation.



    They don't break the economy, because the economy still works. They do allow people to gain an unfair advantage, but it's hard to measure the actual economical damage that they cause. They accelerate an inflation process that is destined to happen whether the y are there or not. I've been in power gaming guilds that have had far more devastating effects on a game economy by locking down dungeons and being general assholes than I think farmers will ever do.



    Farmers are not desirable, I think everyone gets that. It'd be nice if you could just wish them away with magic fairy dust. But that can't and won't happen. Government regulation will likely result in even an even less desirable situation, especially when executed incorrectly by lawmakers who don't really understand what's going on.
  • SabbicatSabbicat Member UncommonPosts: 290
    I wonder if this will start a virtual fight in the Korean Parliment. They like thier fights.
  • ginfress01ginfress01 Member Posts: 203
    Instead of grabbing those that sell gold companies should ban those that buy the gold.
  • SenuvenSenuven Member Posts: 51

    You have your opinion Dam, and I have mine. Judging by the begining of your post, you have got an odd sense of being. There are no "wrong" responses to any article. In your opinion it may be wrong, but in someone elses opinion your not correct.

    If you have played Lineage 2 for any length of time, and have a char in the high 60's or 70's you would know that if you did not purchase virtual currency, you would have almost an impossible time getting items like the A grade helmet. The nightmare helmet, if you bought it from a player around chronicle 4 would cost about 150 + MILLION adena. The average mob drops for that level is about 1000 or so adena, assuming you dont have a team to split it with. The recipe alone prices from about 80-100 MILLION adena, and you need two of them or need to have a dwarf that has one in his book. (by the way, that 1 clicks to craft it in a shop cost about 1-3 million adena just for the afk warsmith to combine those items) My character is a lvl 68 warsmith and I know the game economy because that is how I make my money.

    There are not enough high dollar item drops, so lets say you make on a full good hunting day 100k adena for yourself, after selling off the things you dont want or need. If you dont use soul shots, heal pots, haste pots, arrows or any other consumables, you would be fine. You would have your your nice new helmet in about 6 months, if you never spent anything. Or if you try and craft and it fails (all A grade and up recipes are 60% chance of success) your back to square one.

     

    If you place an item like this in your sell shop, a window pops up to let you know that you are trying to sell an item way above what the game thinks market price is. Now when you try and sell anything at the price of the economy, you will have the window come up warning you and making sure you know the price is to high or to low.

     

    As far as farmers wanting to be left alone and leaving you alone. I would like you to ask any veteran of L2 from probably any server if they tried to do any of the raid bosses, or Baium, or Orfen etc to get the rings and do class change quests you had to make a deal with the farmers, and you had make sure you didnt even appear to loot the corpse because they would PK you. You had to ask permission to have them allow you to come and do a quest you need to get your end game. Heaven forbid another farming agency came to the same boss at the same time, as then everyone dies.

    To error is human, to forgive is devine. Neither are US Marine Corps doctrine.

  • CastorHoSCastorHoS Member Posts: 54
    Damijin I have no clue what games you have ever played to make a statement such as "L2 has a thriving economy" but L2 has no had a real economy since they announced no wipes from open beta to release.



    The only "economy" L2 has is the one dictated by the farmers. No many other games have things that are about 500% over priced because of what farmers sell items for. They jack up the prices and force people to purchase adena from them in order to get anything and as someone else stated they then camp and farm a majority of the major drop areas or quest areas in order to ensure they are they only ones able to get certain things.



    This is not healthy for any game and is exactly why L2 will not last much past the next round of games due for release.



    You can say that the economy is stable but it is stable at a very over inflated way.



    I still stick to the rule that if you mass ban enough accounts that are all linked together and you keep that enforced then these farmers will start to lose money.
  • LeuricLeuric Member Posts: 8
    Well I believe that are many ways to avoid the farm and the damage done by it. Because:



    If a game forces the player to have the latest uber-epic items gear then we start to have a problem.

    If this ultra gear can be only gained from staying many hours and years in the same and few spots

    killing a monster or raiding then the problem grows.



    Because, here enter the farms, they will with the right time, they will not only have the gear, they will

    start to monopoly the places...But  which already is going bad, can turn even worst.



    If the player capacity to gain gold is reduced, either by the fact that npcs buy loot by low prices or because

    gear or items which could help to raise gold are very rare, then the problems grows even more. Then

    farms can dictate the price, in this way force the players to buy their gold.



    In others words, to avoid farms, the easiest way is to plan the way which gear/item to work different. Either

    by using the so called  "exclusive item/gear" (item/gear which only could be used by the player which find,

    principality for uber gear), give more  ways to obtain gear (maybe npcs selling, one time quests, craft), or

    make  a game where gear and gold aren't so vital. Why not some "anti farming codes"? (or make the game

    work in a way which if you stay too much time at the same place, the drop rates fall, forcing him to move on,

    and so reducing the amount of loot which the farmer can get).



    Off course, this won't resolve, but would reduce the damage.
  • ReyzoulReyzoul Member UncommonPosts: 4
    Does anyone have  a reference (prefereably translated) for this article that was cited for the source of of the 1 billion dollar quote?

    An article in The Korea Times cites statistics from the country's Game Development and Promotion institute, which states that the size of the virtual item exchange market is roughly $1 billion and estimates that approximately 60 percent of item trading company profits come from gold farming

    I am rather skeptical.  If there truly is a billion *real* dollars changing hands over items that are not even real.

    The claim is that 60% of the billion dollars is in gold farming alone? That would be $600,000.  At current rates for WoW gold for example,  4000 gold is $1420.88 (IGE's rate for Hellscream/Alliance).  Now I personally can not imagine why anyone would pay that but lets just extend the benefit of the doubt...



    It would take 423 purchases of that amount of gold to get to $600,000.  That means 1,6 Billion gold (1,692,000) farmed up and redistributed into the gaming worlds.  Really?



    And if you figure that most gold buyers really purchase with smaller amounts.. say.. 100 gold at a time.  100 gold is $36.67 on Hellscream/Alliance.  Calculating with 100gp purchases comes out to 164,622 people would need to buy 100gp to reach the $600,000 mark.  That means again, 1.6 Billion gold being bought or farmed and sold within the gaming worlds.



    Assuming the original source of the article is correct and that is where I suspect we are having a fault.  Have any of us read this article which came up with the 1 billion dollar claim?  Are its facts accurate?
  • DrowNobleDrowNoble Member Posts: 1,296
    Originally posted by Taera


    When I get that helmet I've wanted for 10 levels, and finally put it on for the first time, I feel proud.  I earned that helmet, whether through DKP, hours of saving my platinum, camping the named that drops it...if I just paid 5.99$, I don't think I'd feel half that satisfaction.



    Hit the nail right on the head Taera! 

    Oh and I think the $1 billion is a total across all servers?  Estimate all the gold sold on every server for the last 2 years and I think you can hit 9 figures easily.

  • CastorHoSCastorHoS Member Posts: 54
    Originally posted by Reyzoul

    Does anyone have  a reference (prefereably translated) for this article that was cited for the source of of the 1 billion dollar quote?



    An article in The Korea Times cites statistics from the country's Game Development and Promotion institute, which states that the size of the virtual item exchange market is roughly $1 billion and estimates that approximately 60 percent of item trading company profits come from gold farming

    I am rather skeptical.  If there truly is a billion *real* dollars changing hands over items that are not even real.

    The claim is that 60% of the billion dollars is in gold farming alone? That would be $600,000.  At current rates for WoW gold for example,  4000 gold is $1420.88 (IGE's rate for Hellscream/Alliance).  Now I personally can not imagine why anyone would pay that but lets just extend the benefit of the doubt...



    It would take 423 purchases of that amount of gold to get to $600,000.  That means 1,6 Billion gold (1,692,000) farmed up and redistributed into the gaming worlds.  Really?



    And if you figure that most gold buyers really purchase with smaller amounts.. say.. 100 gold at a time.  100 gold is $36.67 on Hellscream/Alliance.  Calculating with 100gp purchases comes out to 164,622 people would need to buy 100gp to reach the $600,000 mark.  That means again, 1.6 Billion gold being bought or farmed and sold within the gaming worlds.



    Assuming the original source of the article is correct and that is where I suspect we are having a fault.  Have any of us read this article which came up with the 1 billion dollar claim?  Are its facts accurate?







    If you actually look at the amount of groups or "companies" doing this and the amount of games they cover then $1 billion is not such a large sum.  L2, EQ & EQ2, DAoC, CoH, DDO, and many many games from Asia are all covered by these people. As a world wide disease it has spread to every game in every area of the world.
  • equinixequinix Member Posts: 5

    Gold selling is a big problem and its hugely affects games, by having to compete with the farmers. I would mind the option of buying stuff from the actual develper but not a farmer. Only people who can really crack down on this would be the developer in my opinion and it would have to be done on the back end tracking finacial transation of characters and the account owners. I pretty sure patterns could be detected with some DB queries. Look how muc h GIL FFXI took out of the system just from this last sweep..........

     


    Dec. 20, 2006 03:00 [PST] From: FINAL FANTASY XI
    User Agreement Violators Terminated (Dec. 20)

    Today, a number of accounts which were confirmed to have violated the user agreement by using unauthorized third-party software tools within FINAL FANTASY XI to enable abnormal in-game movement were discovered and have been suspended or permanently terminated.



    Based on the results of our investigation, over 7,450 PlayOnline accounts were terminated while over 250 accounts were temporarily suspended indefinitely.



    The breakdown for the suspensions is as follows:



    -   Accounts confirmed using third party tools to illegally move their characters:

    400 cases



    -   Accounts confirmed using third party tools to give an unfair advantage over other 

    players in order to get claim on Notorious Monsters.

    4400 cases



    -   Accounts confirmed using illegal means to obtain items

    100 cases



    -   Accounts from people that were previously confirmed to have RMT connections, or that had violated the user agreements but re-subscribed to PlayOnline.

    2800 cases



    The results of our investigation resulted in the confiscation of over 6.2 Billion gil

     

     

  • SenuvenSenuven Member Posts: 51

    I agree with Castro, and think that even the 1 billion dollar figure is conservitive. You have many companies selling adena on L2. Every one in my clan was talking about the best deals they got for items. Add in the charge for power leveling services, and then add the L2 servers. Spread that out across the MMO world, and 1 bil is not a hard figure to come up with. I think L2 does millions a year alone.

     

    As Castro said, L2 probably wont survive the new games coming out. If you go to any starter town you will only see a few farmers, and no real new players.

    I played EQ when the shiny brass halbred and serp bracers were awesome items. I have played EQ2, Eve, WoW, L2, AO, DAoC and even Earth and Beyond (Beta only) and I have seen currency trading in all of them except E&B.

    To error is human, to forgive is devine. Neither are US Marine Corps doctrine.

  • DrowNobleDrowNoble Member Posts: 1,296
    Well come to think of it I've never seen item buying/selling in City of Heroes/Villains.  It may exist, but probably the way the game is designed there isn't really much to buy per se.  The influence/infamy (CoX cash) is pretty steady coming in and also many high levels will give away some Inf to lowbies since they have little use for it.  Myself I've paid lowbies 50k infamy each to team with me so I could get the mob spawn count up on a mission I wanted to solo.  Its chump change to my 44 MM, but a fortune to a lvl 10. 
  • MajorBiggsMajorBiggs Member UncommonPosts: 709
    Originally posted by DrowNoble

    Well come to think of it I've never seen item buying/selling in City of Heroes/Villains.  It may exist, but probably the way the game is designed there isn't really much to buy per se.  The influence/infamy (CoX cash) is pretty steady coming in and also many high levels will give away some Inf to lowbies since they have little use for it.  Myself I've paid lowbies 50k infamy each to team with me so I could get the mob spawn count up on a mission I wanted to solo.  Its chump change to my 44 MM, but a fortune to a lvl 10. 



    i agree. I never had a problem with the economy (was there actually one?) and money system in CoH/V. Maybe because the money was simplistic, or the way to earn it was, or...if it was money at all idk.

    But I've never seen anyone try to sell something besides accts. for CoH/CoV.

  • adrianemeryadrianemery Member Posts: 250

    My Server on the EU side of world of warcraft is plaugued by bot gold farmers. Blizzard talk big by saying that they have banned 107,000 accounts in November but why is it then that all these lvl 60 bot farmers are still sitting in the lvl 50+ zones farming away 24/7 weeks after I hav ereported them to GM's.

    All that these people is jack up prices by increasing the amount of gold sloshing around the server causing massive inflation, reduce the amount of money that you can get and drstically reduce the chance of getting a world drop epic for yourself as these people seriously skew the chances in their favor by being on all the time.

    There should be more GM's tasked with the investiagtion of gold farmers and bans implemented in days rather than the normal weeks or months it can take by that time all the gold they have farmed is long gone.

  • DrowNobleDrowNoble Member Posts: 1,296

    Well the problem with WoW is they ban the account and not the player.  So Bob Farmer got banned, he shrugs, just makes a new account and proceeds as usual.

    I read an article in GameInformer magazine where they investigated the secondary market and powerleveling services.  After they contracted a 40 warlock to be powerleveled, they actually reported themselves to see what Blizzard would do.  Nothing happened and a week later they had a 40 gnome lock with apparently random talents. 

    Probably Blizzard is just overwhelmed by the sheer number of players? 

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