Posts Tagged ‘enterprise class’

News Analysis: FinancialForce.com ERP Arrives To Signal The Era Of Best Of Breed Cloud Suites

FinancialForce Debuts Its Full ERP Suite


On February 19th, San Francisco headquartered, FinancialForce.com announced the launch of its full suite of ERP offerings built on the Salesforce1 platform.  Backed by investments from UNIT4 and Salesforce.com, the cloud based vendor began as a single ledger financial management system built on the Salesforce.com Force.com platform.  The announcement and product launch shows how FinancialForce:

  • Delivers a full ERP suite on the Salesforce1 platform. The platform brings together a series of organic products and recent acquisitions in HR, supply chain, and project management (see Figure 1).  The December 2010 acquisition of Appirio’s professional services automation assets form the Professional Services Automation offering.  The 2013 acquisitions of Vana Workforce and Less Software brought the human capital management (HCM) and supply chain management (SCM) capabilities.

    Point of View (POV):
    The management team at FinacialForce.com was smart to bring in acquisitions built on the original Force.com platform.  Post merger integration was greatly simplified as the products shared a common architectural base.  More importantly, the acquired solutions were easily upgraded to the Salesforce1 platform to create an end to end ERP cloud based ERP suite.  Customers gain the full advantages of the Salesforce 1 platform and integration with the core Salesforce CRM offerings.
  • Demonstrates focus on long term growth and viability .  FinancialForce.com showed 80% year over year growth in revenue run-rate compared to 2012.  Headcount grew 62% year over year with over 260 global employees.  Furthermore, customers represent a global base with 27 countries and users in 45 countries.

    (POV):
    Cloud has gone mainstream and customers now expect their cloud companies to demonstrate viability.  The mergers and acquisitions required to build a full cloud ERP suite signal a maturity by FinancialForce.com and the market.  Early customers of the full suite provide positive references on both the synergies of the ERP offering and the flexibility of the Salesforce1 platform for extensibility.

Figure 1. FinancialForce.com Launches A Full Integrated ERP Suite

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Quips: Good Technology Data Validates That Apple iOS Is Still King of Enterprise Class Mobile in The US

Apple Grows In Net Activations In Q4 As Well As Overall

The February 12th, 2014 Good Technology Mobility Index report validates what many North American based enterprises know – Apple iOS is dominating Google Android inside the enterprise in the US markets.   While this data is limited to the Good Technology customer base, which has a strong US following, anecdotal inquires and formal polling by Constellation Research, Inc. validate that this data is directionally accurate.  Here are three graphics that illustrate the point:

  1. Net Activations By Type of Device Show iOS up in Smart Phone and Tablets While Android Drops
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News Analysis: New #IBMWatson Business Group Heralds The Commercialization Of Cognitive Computing. Ready For Augmented Humanity?

IBM Launches New Business Group In New York’s Silicon Alley

On January 9th, 2014, on top of 4 World Trade Place, IBM CEO Ginni Rommety and long time veteran, but newly minted, IBM Watson Group Senior Vice President Michael Rhodin, announced IBM’s commitment to putting an entire business unit around Watson (see Figure 1).  The arrival of Watson represents a culmination of artificial intelligence, natural language processing, dynamic learning, and hypothesis generation to take vast quantities of data to make better decisions.  The IBM Watson business unit is the tech giant’s multi-year $1 billion initiative to deliver cloud based cognitive computing products for industries such as healthcare, retail, financial services, advertising, travel, and hospitality.

Figure 1. IBM Watson Group’s, Senior VP Mike Rhodin With A Warm Welcome

Source: IBM

Three key insights emerge from the launch:

  • IBM is committed to creating a brand new category and ecosystem. Focused on cognitive computing, over 2000 professionals form the newest business unit at IBM headquartered in New York City’s Silicon Alley.  The Watson ecosystem launched on November 14th, 2013 has over 750 applicants and $100M in equity investment (see Figure 2).  The ecosystem includes the Watson Developer Cloud, Watson Content Store, and the Watson Talent Hub.  In addition, the new business group is headed by IBM veteran Mike Rhodin.  Mike is a senior and well rounded executive who led the software solutions group which included the Business Analytics, Smarter Cities, Smarter Commerce, and Social Business product lines.

    Point of View (POV):
    The ability to self learn enables continuously reprogramming.  Cognitive computing is more than a new category.  These advancements represents a new class of technology to enable human and machine guided decisions.  IBM’s commitment can be seen by the level of executive and the management team chosen to grow a brand new class of software, services, and apps.  Constellation believes that the IBM Watson team has put forth a wide range of innovative ecosystem partnerships across a diverse set of industries.  In fact, the client solutions center and design lab are key to clients experiencing how Watson can create disruptive business models and transform an industry.  Moreover, the establishment of a business incubator is key to attracting crucial talent, technology, and ecosystem to spark new ventures.

 

Figure 1. IBM Showcases The Entire Watson Family and Ecosystem

Source: IBM

  • IBM is putting considerable resources towards the commercialization of products and services. At the unveiling, IBM announced three new cloud-delivered Watson offerings to add to the IBM Watson Engagement Advisor launched on May 21, 2013.  IBM Watson Discovery Advisor uses cognitive intelligence to apply context on vast quantities of unstructured and structured data.  The goal -  identify patterns for research teams to advance their efforts in industries such as pharma, publishing, and education.  IBM Watson Analytics provides capabilities that allow users to verbally ask questions and receive high quality data visualizations and insights.  IBM Watson Explorer provides the toosl to find, extract, and deliver content regardless of format or data source.
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News Analysis: Acumatica Raises $10M In Series C Funding, Aims For 1B In Revenue By 2023

New Funding Round Fuels Road Map And Geographic Expansion


On November 18th, privately held Acumatica announced Series C funding from Runa Capital and Almaz Capital.  The  Kirkland, WA based Acumatica, has been quietly providing its partners a customizable, cloud-based ERP and CRM development platform for the SMB market.  Acumatica’s previous rounds were funded by Visma (a KKR company) and Almaz Capital (backed by Cisco).  The announcement is significant because Acumatica intends to:

  • Expand its partner base into new markets. Acumatica currently has offices in Washington DC, Singapore, and Moscow.  Through affiliates, resellers, and partners,  Acumatica is present in the US, Canada, Mexico, UK, Nordics, The Netherlands, Africa, Middle East, India, and Southeast Asia.  Sales come exclusively from partners.  Thus, the company intends to recruit more partners for high growth markets such as Asia and Latin America.  European expansion will focus on a replacement ERP market of aging systems

    Point of View (POV):
    Early success with Acumatica has come from the ease of use and functional footprint that accelerates a partner’s ability to take a solution to market.  However, future growth will require the leadership team to increase its investment in brand awareness and partner enablement.  Expect key hires in partner sales, support, and R&D.  Given the limited number of qualified partners in the market, Acumatica will have to convince partners from competitors to switch.  Early indications show this market traction.  In fact, since August 2013, Acumatica has added 50 partners, bringing the total to 270.

News Analysis: Sitecore Acquires Commerce Server In Quest Towards Customer Experience Management

Commerce Server Finds Its Logical Home

On Wednesday November 20th, 2013, Copenhagen, Denmark based Sitecore acquired Ottawa, Canada based commerceserver.net for an undisclosed price.  Originally known as the Microsoft Siteserver and Commerce Server 2000, the product was orphaned by Microsoft,  then Ascentium, the key development partner were given the rights to further develop and market the product.  Adding to the lore, Ascentium changed their name to SMITH in the Fall of 2012 and the product group was rebranded to commerceserver.net.

Sitecore’s acquisition continues a consolidation trend in the Matrix Commerce market where vendors are aggregating technologies to support a buyer centric approach to customer experience.  Constellation believes customers should pay attention because Sitecore:

  • Signals seriousness to deliver on end to end customer experience. Sitecore’s portfolio includes its core web content management offerings and an emerging set of digital marketing assets.  Commerce Server adds key B2C functionality for hard goods, digital goods, and web based services; B2B capabilities in trading communities and e-procurement; complex B2X scenarios; and personalized portals.

    Point of View (POV):
    Addition of commerceserver.net fills one key hole in Sitecore’s customer experience management portfolio.  Customers and prospects can expect additional acquisitions from the new management team.   In fact, the company has brought in heavy hitters such as a new CRO and CMO over the past 12 months.  Constellation believes that Sitecore is serious in completing key holes in the end to end customer experience story and moving up the stack to support a range of small to large enterprise customers.  In fact, Commerce Sever 10 scales up to support 220,000o orders/day on a 12 hour peak, 60 million user profiles, 10 million item catalogs, 100,000 catalogs and virtual catalogs, and hosting support for 100 active, 1000 provisioned.  Constellation believes the acquistion places Sitecore in the direct battle with Adobe, IBM, Oracle, and SAP for customer experience and commerce.
  • Ensures Commerce Server a friendly and natural home. Commerce Server brings its core Microsoft heritage.  Dependencies include Microsoft SQL Server, .NET,  Commerce Server Staging (CSS), and Component Object Model.  Commerce Server also plays well with other Microsoft server stack components including Biz Talk Server and Microsoft Office SharePoint Server.  Sitecore’s software is built on a Microsoft.NET platform.  Deployable in Microsoft Azure, the core CMS can use Oracle or Microsoft for the database and content can be stored in either .NET or XML objects.

    (POV):
    Customers should find relief that the Commerce Server assets return back to a product centric company.  While SMITH (formerly known as Ascentium), a digital experience agency, served as a reasonable owner and even delivered the latest version 10 release, software cultures and services business models often clash.  Why? The research and development investment required to take products to market work against the resource utilization and project focus required for successful services.  Constellation will measure integration success by how well the team builds and accelerates the original major release plans (see Figure 1).
  • Gains critical ecosystem assets. Commerce Server brings 3000 customers and 25 partners around the world.  Partners range from 17 enterprise providers, hosting providers, training, ISV, and consultants. Key industries for Commerce Server include retail, manufacturing, and e-government.  Sitecore brings over 3000 customers, 1000 certified business partners in 50 countries, 8,000 certified developers, and 17,000 active members in the developer ecosystem.

    (POV):
    Prior to the acquisition, Commerce Server product holes included content management, search, analytics, campaign management, and other key customer experience management capabilities.  Sitecore fills many of these product gaps and adds a larger ecosystem.  Customers can expect significant cross-training among the partners as they integrate the Commerce Server assets into their portfolios.

Figure 1. The Pre SiteCore Acquisition Commerce Server Road Map More…

Tuesday’s Tip: Understand The Five Generation Of Digital Workers And Customers

Age Is Not The Deciding Factor In Five Generations Of Workers

When discussing the future of work, most folks immediately jump to the discussion of millennials, generation Y, generation X, baby boomers, post war, etc.  However, the shift to digital business finds a different type of five generations.  This segmentation describes how digitally proficient people are with digital technologies and culture. Constellation sees five generations (see Figure 1):

  1. Digital natives – people who grew up with the internet, comfortable in engaging in all digital channels.
  2. Digital immigrants - people who have crossed the chasm to the digital world, forced into engagement in digital channels.
  3. Digital voyeurs – people who recognize the shift to digital, observing from an arms length distance.
  4. Digital holdouts – people who resist the shift to digital, ignoring the impact.
  5. Digital disengaged – people who give up on digital, obsessed with erasing digital exhaust.

Figure 1. Five Generations Of Workers With Different Expectations And Values

Source: R Wang, Insider Associates, LLC. All Rights Reserved.

The Bottom Line: Build Journey Maps For The Five Generations Of Digital Workers

Where you work, when you work, how you work, what you work on, and why you work have been disrupted in this digital world.  These five generations of workers have different people centric values that More…

Trends: Real World Lessons In Optimizing The Customer Service Experience From Kana Connect

Workshop On Optimizing Your Customer Service Experience Identifies Eight Strategies
At the 2013 Kana Connect event from September 15th to 17th, 2013 in New Orleans, I had the pleasure of co-leading a workshop with Scott Hays a Sr. Director, Product Marketing for KANA Software.  The goal of the session was to explore eight strategies to improve customer experience. 

By now, you are well aware that “experience counts.” Your customers’ loyalty and future purchases hang in the balance. In this session, we’ll explore the key things you can do to make sure their experiences are positive. Ray Wang from Constellation Research and Scott Hays from KANA guide an interactive workshop to invigorate your future initiatives.

Speaker(s): Scott Hays, Ray Wang, Constellation Research

The event began with a overview of  Constellation 9C’s of customer engagement  and then an overview of the eight ways to optimize your customer service experience.  Teams were broken up to documen current state and to rank future state.  Teams were told to identify the top three ways among these eight strategies:

  1. Effortless and personalized
  2. Channel convenience
  3. Channel consistency
  4. Social media
  5. Unified agent desktop
  6. Agent knowledge
  7. Process-driven
  8. Internationalization

Results Show Future Focus on Channel Consistency, Social Media, and Effortless and Personalized

Given the Kana customer base, current state priorities of agent knowledge, process driven, and channel convenience came as little surprise to the participants.  In fact, most workshop attendees have had More…

Event Report: Metaio’s #InsideAR Conference Hails The Future Of An Always On, Always Augmented Reality

Digital Business Arrives In The Always On Always Augmented World


On October 10th and 11th, 2013, over 800 attendees from more than 45 countries arrived at the Munich Olympic Park to share their passion and excitement about the latest augmented reality (AR) developments (see Figure 1).  Hosted by augmented reality pioneer Metaio, Inside AR 2013, has emerged as one of the world’s largest conferences dedicated to the business of AR.  The conference touched on key areas such as:

  • Wearable computing
  • Hardware advances
  • Applications and development
  • Global adoption
  • Future of digital business and AR
  • AR use cases from engineering to sales
  • Consumer AR
  • Future of print and packaging in AR
  • Public sector use cases

Figure 1. Full Flickr Stream Of InsideAR Including Demo Videos


<iframe align=center src=http://www.flickr.com/slideShow/index.gne?user_id=35408001@N04&set_id=72157636422322475&detail=yes frameBorder=”0″ scrolling=no width=”600″ height=”500″></iframe>

Source: Copyright © 2001 – 2013 R Wang and Insider Associates, LLC All rights reserved.

Augmented Reality Brings Contextual Experiences To Life

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Event Report: CRM Evolution 2013 – Seven Trends In The Return To Digital Business And Customer Centricity

Market Leaders Refocus On Digital Business and Customer Centricity

The annual gathering of the industry’s top thought leaders, users, and vendors of CRM converged at the Marriott Marquis in New York this past August 19th to 21st.  As with any good conference, the speaker tracks and the corridor conversations provided a glimpse of where market leaders and fast followers planned to make their future investments and provided key insights for 2014.  After speaking with over 100 attendees, the following seven trends emerged from this year’s event:

  1. CRM is dead, well not really. While the term CRM is loosely used to define many things.  Leaders realize that CRM is the technology.  Customer experience is the business process and journey maps.  Customer centricity is a state of mind that’s required of management and leaders.  While customer experience is the new term du jour, all three elements (i.e. technology, business process, and people leadership) are required for success.  Front office is more descriptive than Tom Siebel’s legacy term of CRM.
  2. Customers seek outcomes not products or services. Customers no longer buy products.  Customers expect products to be bundled with services.  Services providers now seek to sell experiences.  Experience providers now sell access to outcomes.  This evolution of what customer’s want and what’s delivered continues to accelerate.  With hipsters and millennials short on cash, access, experiences, and outcomes have emerged as one market category to deliver for in this growing sharing economy.  However, not all customers seek just access. A movement to move too far, will result in a backlash from a majority of customers who seek ownership without the shackles of renting.
  3. Transformation projects now rally behind the shift from social back to digital business. The social business and social crm era focused on a key aspect of CRM – the relationship.  In the past, CRM excelled at management, poorly accomplished customer, and failed at relationship.  Looking back three years,  the rise of social ties back to the need to address relationships.  Now that social moves to the mainstream, market leaders refocus to digital transformation of customer centric initiatives.
  4. Funnels make no sense in an asynchronous world. Classic sales, marketing, and service funnels force fit customers into unrealistic models.  Entry points will ebb and flow as channels and context drive demand into a variety of use cases.  Design must account for this constant state of change.
  5. Big data provides relevancy and context. All the hype on big data continues to miss the point.  Customer centricity requires context.  Context creates relevancy based on a customer’s roles, relationships, products, services, location, time, sentiment, and intent.  Without relevancy, acquisition, targeting, and personalization will fail.
  6. Front office still needs back office integration. Integration with back office is required for customer experience.  A customer who makes an order for a product or service that’s out of stock and billed twice for something they did not receive will most likely be upset.  Customer centricity is both a front office and back office exercise.
  7. Identity plays a key role. Identity plays a multi-faceted role for each individual. The business implications of identity after authentication, authorization, access, and availability touch on commerce, work lives, personal lives, and engagement with each other.  Identity is a unifying factor in the current transformation to a digital world and required for customer centricity.

The Bottom Line: Business Leaders Must Embrace Customer Centricity In Order to Differentiate In A Digital World

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Monday’s Musings: NSA PRISM Scandal Hurts US Cloud Companies And Hastens The Return Of On-Premises Software

Non-US Based Organizations And Even Some US Organizations Will Not Tolerate Snooping In A Post PRISM World

Since the Edward Snowden PRISM revelations, Constellation has received a steady stream of inquiries on cloud strategy.   In fact, nervousness runs high among many non-US based companies using services from US based cloud companies across the cloud stack.  In early August 2013, the Information Technology & Innovation Foundation put out its report “How Much Will PRISM Cost the U.S. Cloud Computing Industry” Assuming that 20% of current clients switch to a non US based provider,  the report estimates a loss of $22 to 35B by 2016.

Constellation agrees.  All signs point to an anti-US stance until the security issues is addressed.  The odds on the US government moving fast on this issue are as good as Major League Baseball players or Tour de France Cyclists honoring a performance enhancement drug use ban.  In fact, Constellation is aware of at least 50+ contracts that have been put on hold or cancelled in the past 30 days.  With the EU’s Nellie Kroes already sounding the alarm bells in a way she only can, cloud buyers have taken notice.

The Bottom Line: Clients Should Consider Alternatives To Pure Cloud Models And Encryption Technology

Interesting enough, fifteen years into the cloud revolution, talk has rekindled about building on-premises software in light of this scandal. Unfortunately, the last major on-premises software company to receive funding squandered it all in 2005 and retooled to the cloud. Furthermore, a few entrepreneurs are looking at VC funding to take some key systems back on-premises.

However customers do not have time to wait for new software to arrive in the on-premises deployment option.  In the meantime, a few near term strategies have emerged:

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Tuesday’s Tip: Putting the Kibosh On ERP Vendor Sales Reps Who Troll For Indirect Access

Constellation Sees An Alarming Increase In Inquiries

Constellation has received an alarming increase in inquiries about an unethical vendor sales practice coined as “trolling for indirect access”. Indirect access is when a vendor claims that a client is accessing their perpetually licensed software in an unintentional manner or inappropriately licensed manner.

One vendor uses a definition of, “any individual or machine that accesses the computing capabilities of the software must be a licensed user”.

Another vendor sees it as “any time a system is accessed by a non-vendor system, a license is required to access that data”

In fact, a rash of inquiries over the past two quarters has raised the alarm bells among software customers.

Unethical Sales Leaders Endorse This Practice To Make Their Numbers

While this practice is nothing new, the pickup by vendors raises serious issues as to why this practice remains in their sales play books. Constellation identifies five reasons why vendors continue this practice:

  1. Open up dormant accounts. After pleasant introductions, new sales reps will use this technique to further deals.  Former sales reps agree this is a shake down for cash technique.
  2. Drive sales through fear of audits. Audits are used to start the discussion.  Unsuspecting customers who no longer have context about the original contract may fear breach of contract.
  3. Scare customers into making additional purchases. Threats are used to set expectations.  The vendorsoften waives the issue if the customer buys additional licenses as a “compromise”
  4. Force compliance into new licensing policies. Vendors use this as a way to drive conformity to new license models.  The move from concurrent usage to named users was one example.
  5. Meet territory sales goals. Unscrupulous sales managers suggest this technique to meet their numbers.  Sales reps are told they are defending the vendors license rights.

It All Starts With An Innocent Sales Call From A New Sales Rep

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Monday’s Musings: The Controversy Surrounding Gartner’s CRM Market Share Analysis

The Gartner Market Share Analysis:CRM Software Report Raises Questions On Accuracy of Market Sizing Reports

The recent Gartner report “Market Share Analysis: Customer Relationship Management Software, Worldwide, 2012” has generated some controversy among the enterprise software set.  The report and other reports such as these, are often used for bragging rights by vendors and for buyers to gauge vendor viability.

This specific report attempts to rank CRM software spending by vendor using total software revenue worldwide.  The good news – the numbers are directionally correct with Salesforce.com claiming the top mantle from SAP this year with $2.525 billion in CRM revenue (see Figure 1). The bad news – many question the accuracy of the actual revenues numbers as listed in the press release, especially for the Microsoft Dynamics CRM business.

As Scott Bekker at Redmond Magazine reported, “Gartner put Microsoft’s CRM revenue at $1.1 billion, up from $900 million in calendar-year 2011.  That’s a sizable bump. As of May 2012, Microsoft was only claiming that all of Dynamics, which includes Microsoft’s established ERP products as well as CRM, amounted to $1 billion in annual revenues.”

Mssr. Bekker makes a polite but astute point.  The 26% bump in CRM revenue is significant.  However, the total revenues are questionable.  In any modest observation, that kind of overall growth in the Microsoft Dynamics unit would have Microsoft CEO, Steve Ballmer, shouting from the tops of Mount Ranier and probably have Kirill Tatarinov next in line to be Microsoft’s CEO.

Figure 1. Gartner’s Recent CRM Software Spending by Vendor, Total Software Revenue Worldwide, 2012 (Millions of Dollars)

Not to violate any copyright laws, despite fair use laws, here’s a link to the full table found in their press release. A recreated table below shows the rankings.

Bottom line it shows Microsoft in 4th place for CRM with over 1.1B in revenue.

Organization 2012 revenues 2012 marketshare (%) 2011 revenues 2011-2012% growth
salesforce.com 2,525.6 14.0 2,004.6 26.0
SAP 2,327.1 12.9 2,325.1 0.1
Oracle 2,015.2 11.1 1,870.0 7.8
Microsoft 1,135.3 6.3 900.9 26.0

The Market Sizing Game For Vendors And Legacy Analyst Firms Flawed With Faulty Methodology

In reality, the market sizing game for enterprise software is both an art with some science.  Having played this role as a vendor in an Analyst Relations capacity in a past life, one knows that executives can not disclose such financial information directly to a research or market sizing firm.  The research analysts must play a guessing game with the software executive and ask 100 questions to zero in on a number.  Unlike hardware, where individual counts are more obvious, software revenue sizing requires analysts to dig deep into financial statements and any conversation where growth rates have been discussed.  Revenues are hidden in bundling, suite sales,  discounting schemes, channel revenue deals, OEM arrangements, and inter-company transfers.  To complicate matters, SaaS revenue calculations can differ from how on-premises revenues are calculated.  Analysts must also determine the truthfulness of vendors who are trying to indirectly guide analysts to the “right” numbers.  In short, this is hard work.

As assumptions are built on previous numbers, one false guess in a previous year, cascades and geometrically inflates or deflates a set of future numbers.  In the case of these CRM numbers, one may speculate that past executives may have provided a higher number than actually generated, resulting in the current alleged inaccuracies.  Another speculation may come from previous and current analysts who may only focus on one area of the business and not have the total picture on the Microsoft Dynamics overall business.  There are many points of inaccuracy that can occur with software revenue market sizing and every legacy analyst and market sizing firm works hard to avoid these situations.  For market analysts, dissecting revenue from vendors such as SAP and Oracle is often difficult as these numbers and break outs are masked with multiple acquisitions and product lines.

To be clear, the SAP and Oracle numbers also seem inflated.   These numbers have been inflated over decades.  Given that these vendors also have many other lines of revenue aside from CRM, it’s hard to gauge the accuracy of their numbers without some digging.  Now one would assume a market sizing firm should be doing this right?

The Microsoft Dynamics CRM Revenues Do Not Meet The General Sniff Test

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