August 10, 2012 (Google Will Pay $22.5 Million to Settle FTC Charges)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for FRIDAY, AUGUST 10, 2012

Headlines is taking Mondays off in August; we will return TUESDAY, AUGUST 14, 2012


PRIVACY
   Google Will Pay $22.5 Million to Settle FTC Charges it Misrepresented Privacy Assurances to Users of Apple's Safari Internet Browser - press release
   Can Google be trusted? - analysis
   How to Detect Apps Leaking Your Data [links to web]
   Shopper Alert: Price May Drop for You Alone

INTERNET/BROADBAND
   Across the planet, broadband is getting faster & faster
   The state with the fastest Internet is...
   Internet attacks from China and US increased in first quarter of 2012, report says
   The United Nations and the Internet: It's Complicated - op-ed
   Cable And Telephone Companies Distort Reality

ELECTIONS AND MEDIA
   This Political Ad Brought To You By… - analysis
   Romney: Campaigns shouldn’t run ads that fact-checkers say are false
   President Obama to blanket Tampa airwaves for convention [links to web]
   Friends of Democracy Super PAC Makes First TV Buy [links to web]
   Belo Offers Candidates Free Airtime [links to web]

WIRELESS/SPECTRUM
   The Campaign to Digitize Your Wallet Is Intensifying - analysis
   The Mobile Payments Committee: AT&T, Verizon, Sprint, T-Mobile unite for the future of payments [links to web]
   Apple vs. Samsung Trial Forces Companies to Open Up the Books
   Software titans enter the physical world
   T-Mobile loses subscribers, smartphone sales fall flat [links to web]
   Growing Wireless [links to web]

RADIO/TELEVISION
   A public-private partnership
   The Whole Story: Moms, Radio And Recency [links to web]
   Is TV News Making More Mistakes? Or Are They Just More Obvious?

EDUCATION
   Why Web Literacy Should Be Part of Every Education - op-ed
   Smashing Silicon Valley’s biases

STORIES FROM ABROAD
   Scrutiny for Vodafone and Telefónica deal
   Madrid accused of media interference

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PRIVACY

GOOGLE SETTLEMENT
[SOURCE: Federal Trade Commission, AUTHOR: Press release]
Google has agreed to pay a record $22.5 million civil penalty to settle Federal Trade Commission charges that it misrepresented to users of Apple’s Safari Internet browser that it would not place tracking “cookies” or serve targeted ads to those users, violating an earlier privacy settlement between the company and the FTC. In addition to the civil penalty, the order also requires Google to disable all the tracking cookies it had said it would not place on consumers’ computers. Google did not admit to violating the law. The FTC said Google broke the terms of a 2011 settlement over privacy missteps related to the now-defunct Buzz, a social networking tool. FTC Commissioner J. Thomas Rosch filed a dissenting statement because he said the FTC should not have accepted Google’s denial of liability, which he called “inexplicable.” Google has said its actions were unintentional and had resulted from a change in Safari of which Google was unaware. When the issue was brought to the company’s attention, it said, it stopped using the cookies and showing personalized ads on Safari browsers. David Vladeck, the director of the commission’s Bureau of Consumer Protection, said he had little patience for Google’s explanation, and referred to other privacy violations about which Google has also said it was unaware, like collecting personal data with its Street View cars.
FTC Chairman Jon Leibowitz said the penalty is meant to send a message that “No matter how big or small, all companies must abide by FTC orders against them and keep their privacy promises to consumers, or they will end up paying many times what it would have cost to comply in the first place.”
benton.org/node/131926 | Federal Trade Commission | NYTimes | Wall Street Journal | Washington Post | LA Times | The Hill | ars technica | GigaOm | Politico
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CAN GOOGLE BE TRUSTED
[SOURCE: Politico, AUTHOR: David Saleh Rauf]
Moving forward, trust is going to be more important than ever for Google. Regulators at the Federal Trade Commission and the European Commission are weighing the biggest threat to the company to date: Potential antitrust cases related to whether Google unfairly used a dominant position in search to harm competitors. European officials, who have been working in concert with the FTC on the Google probe, are engaging in settlement talks with Google. The FTC, however, has stayed mum on what’s it’s planning to do, although the agency earlier this year hired a big gun — former Justice Department prosecutor Beth Wilkinson — to pursue the antitrust investigation. If the FTC decides to settle rather than go to court, observers say any deal will need to incorporate a powerful enforcement tool to make sure Google doesn’t run afoul of any agreement. “A lot of folks would say Google is not trustworthy in terms of voluntary actions and consent decrees,” said a senior Judiciary Committee staffer. And if Google needs a quick lesson in how credibility can impact high-stakes antitrust scenarios, it doesn’t have to look any further than one of its biggest rivals: Microsoft. There is “a certain trust-based relationship, and when you diminish that with government enforcers and the people that are in charge, it absolutely affects government enforcement decisions,” said Makan Delrahim, who served as a top Department of Justice antitrust regulator under the Bush administration. “The government isn’t just some inanimate object,” Delrahim said. “They’re people. And just like in your personal life, if you are unfaithful to them the first time, you may make it work, but the fact that you did will always be in the back of their mind. Usually, if you repeat it a second time, then that’s the end of the trust between the two.”
benton.org/node/131967 | Politico
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PERSONALIZED PRICING
[SOURCE: New York Times, AUTHOR: Stephanie Clifford]
Airlines, hotels and rental cars have offered variable prices for years. Those prices, however, are almost always based on capacity and timing, or are given to groups — seniors get one discount, frequent users another. Now grocers like Safeway and Kroger are going one step further, each offering differing methods to determine individualized prices. Hoping to improve razor-thin profit margins, they are creating specific offers and prices, based on shoppers’ behaviors, that could encourage them to spend more: a bigger box of Tide and bologna if the retailer’s data suggests a shopper has a large family, for example (and expensive bologna if the data indicates the shopper is not greatly price-conscious). The pricing model is expected to extend to other grocery chains — and over time could displace standardized price tags. Even though the use of personal shopping data might raise privacy concerns among some consumers, retailers are counting on most people accepting the trade-off if it means they get a better price for a product they want.
benton.org/node/131973 | New York Times
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INTERNET/BROADBAND

FASTER INTERNET AROUND THE WORLD
[SOURCE: GigaOm, AUTHOR: Om Malik]
Akamai’s latest State of the Internet Report finds:
A 6 percent increase globally from the fourth quarter of 2011 in the number of unique IP addresses connecting to Akamai, growing to over 666 million.
The global average connection speed was 2.6 Mbps
The global average peak connection speed increased to 13.5 Mbps.
South Korea had the highest average connection speed at 15.7 Mbps, while Hong Kong had the highest average peak connection speed, at 49.3 Mbps.
In the first quarter of 2012, average connection speeds on known mobile providers ranged from 6.0 Mbps down to 322 kbps.
Average mobile peak connection speeds during the quarter ranged from 32.2 Mbps down to 2.2 Mbps.
Mobile data traffic almost doubled from the first quarter of 2011 to the first quarter of 2012 and was up 19 percent quarter-over-quarter.
In the first quarter, Hong Kong took the top spot for average peak connection speed (49.3 Mbps), dropping South Korea (47.8) to second place. The remaining top 5 included Japan (39.5 Mbps), Romania (38.8 Mbps) and Latvia (33.5 Mbps).
Globally, high broadband (10 Mbps or higher) adoption increased 19 percent to 10 percent in the first quarter, and South Korea had the highest level of high broadband adoption, at 53 percent.
Global broadband (4 Mbps or higher) adoption grew 10 percent to 40 percent, with South Korea having the highest level of broadband adoption, at 86 percent.
Nine of the top 10 countries saw high broadband adoption levels increase quarter-over-quarter, ranging from a 7.6 percent increase in Hong Kong (to 28 percent) to a surprisingly large 63 percent jump in Denmark (to 15 percent). Overall, 42 qualifying countries saw quarterly growth in high broadband adoption, from a massive 149 percent increase in South Africa (to 0.7 percent) to a 3.4 percent increase in Ireland (to 10 percent).
Nearly 60 percent of US connections are above 4 Mbps while 15 percent of US connections are about 10 Mbps.
benton.org/node/131917 | GigaOm
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FASTEST INTERNET
[SOURCE: CNNMoney, AUTHOR: Erin Kim]
According to Akamai’s State of the Internet Report, Delaware is the state with the fastest connection speeds. Delaware had an average connection speed of 10.2 megabits per second in the first three months of 2012. Delaware clocked in nearly 9% faster than the average speeds in New Hampshire, the state with the second-fastest Internet connections. Vermont, Utah and Rhode Island round out the top five U.S. states. At 3.6 Mbps, Arkansas is the state with the lowest average connection speed.
18 US states had average peak connection speeds above 30 Mbps in the first quarter, while 31 states had average peak connection speeds above 20 Mbps.
19 total states saw high broadband adoption increase between 100 percent and 200 percent year-over-year.
benton.org/node/131916 | CNNMoney
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ITU AND THE INTERNET
[SOURCE: Foreign Policy, AUTHOR: Rebecca MacKinnon]
[Commentary] The immediate threat to the Internet as we know it is the World Conference on International Telecommunications (WCIT) scheduled for December in Dubai by the International Telecommunication Union (ITU), a U.N. body whose remit has thus far been limited to global telephone systems. Members meet behind closed doors. Their policy proposals were until recently accessible only to members -- until activists forced transparency upon them through a website called "WCITLeaks." The leaked documents reveal how a number of governments -- in league with some old-school telecommunications companies seeking to regain revenues lost to the Internet -- are proposing to rewrite global international telecommunications regulations in ways that opponents believe will corrode, if not destroy, the open and free nature of the Internet. This is by no means, however, the first attempt by powerful governments to assert power through the ITU. China, Russia, and many developing countries have complained for nearly two decades that the new, nongovernmental multistakeholder institutions are dominated by Americans and Western Europeans who manipulate outcomes to serve their own commercial and geopolitical advantage. These critiques converge with the interests of former and current state-owned phone companies wanting to restore revenues of yore before email and Skype wiped out the need for most international phone calls.
benton.org/node/131909 | Foreign Policy
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Internet attack traffic
[SOURCE: IDG News Service, AUTHOR: Loek Essers]
China and the U.S. were the two largest sources of Internet-attack traffic in the first quarter of 2012, increasing to account for 16 percent and 11 percent respectively, according to Akamai Technologies. Attack traffic from China increased three percentage points compared to the last quarter of 2011 and attacks from the U.S. increased one percentage point in the same period, Akamai said in its First Quarter, 2012 State of the Internet report. Russia ranks third in the top ten and generated 7 percent of all attack traffic, a slight increase compared to last year's results. Over the past four years the U.S. has been responsible for as little as 6.9 percent of attack traffic and as much as 22.9 percent, Akamai said. The highest concentration of attack traffic generated from China was observed in the third quarter of 2008 when the country was responsible for 26.9 percent of attack traffic, it added.
benton.org/node/131962 | IDG News Service
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DISTORTING REALITY
[SOURCE: InformationWeek, AUTHOR: Jonathan Feldman]
[Commentary] The incumbent telecom providers are acting like a bunch of irrational adolescents who won't let go after it's clear that the game is over and the stadium has cleared out. Their convoluted, customer-hostile, and reality-distorting arguments are starting to get old. I'm tired of seeing them spend money on lobbyists and spin instead of innovative business services. For example, AT&T, Comcast, and a state lobbying group in Georgia are requesting that the state's public service commission require rural telcos to raise their rates. Apparently, little Chickamauga Telephone Co. doesn't charge enough. Next thing you know, they'll be begging regulators to require non-incumbents to make data speeds slower. Instead of continuing their adolescent attempts to bend reality, the incumbent telecoms should start joining the innovators and the folks who actually own the assets that broadband travels upon to create something new and great. Because if they don't, someone else will.
benton.org/node/131946 | InformationWeek
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ELECTIONS AND MEDIA

THIS POLITICAL AD BROUGHT TO YOU BY…
[SOURCE: Benton Foundation, AUTHOR: Kevin Taglang]
[Commentary] With our history so closely tied to advertising and broadcasting and our mission focused on enhancing democracy, the Benton Foundation has always had an eye on the impact of media on elections. So we take a moment this week to reflect on advertising and the 2012 elections. In 1937, near the peak of radio’s “Golden Age,” William Benton argued, "If the great universities do not develop radio broadcasting in the cause of education, it will, perhaps, be permanently left in the hands of the manufacturers of face powder, coffee and soap, with occasional interruptions by the politicians." Although we leave the full implications of that quote for another day, we see that for the next 12 weeks at least that those “occasional interruptions by the politicians” will be more frequent than ever.
http://benton.org/node/131933
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ROMNEY AND MISLEADING ADS
[SOURCE: Washington Post, AUTHOR: Greg Sargent]
Yes, Mitt Romney really said this:
“You know, in the past, when people pointed out that something was inaccurate, why, campaigns pulled the ad,” Romney said on the radio. “They were embarrassed. Today, they just blast ahead. You know, the various fact checkers look at some of these charges in the Obama ads and they say that they’re wrong, and inaccurate, and yet he just keeps on running them.”
I sympathize with Romney’s plight. I’ve said that the Priorities USA ad suggesting Bain is to blame for the steelworker’s wife goes too far. I agree that the Obama ad labeling him as an “outsourcer in chief” was false. It was unfair and misleading of Dems to quote Romney this way: “I like being able to fire people.”
And yet it remains puzzling that Romney would go here. After all, fact checkers have called out his ads as wrong, inaccurate, misleading or false again and again and again and again and again and again and again. If Romney pulled any of those ads, I’m not aware of it.
benton.org/node/131953 | Washington Post
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RADIO/TELEVISION

KICKSTARTER AND 99% INVISIBLE
[SOURCE: The Economist, AUTHOR: ]
Crowdfunding platforms like Kickstarter, where contributors earn rewards in kind, are often likened to fundraisers for public broadcasting. "99% Invisible" flips this logic on its head. The quirky, design-oriented public-radio show has raised $160,000 through Kickstarter to produce the next season. Other public-radio types are taking notice. Roman Mars, who produces and hosts "99% Invisible", turned to crowdfunding as an experiment to gauge the audience's interest in a third series of the program, which runs 4.5 minutes on broadcast radio (with a separately edited longer podcast version available) and considers topics such as audio poetry of sounds made by escalators, the origins of the use of cavemen in GEICO ads and reasons for the limited supply of Trappist beer. Mars, who runs the show on top of his part-time involvement with the Public Radio Exchange (PRX), a non-profit that helps stations share programs, wondered if it had enough of a following to bypass the footwork necessary to secure regular underwriters (firms and individuals who receive short sponsor messages during broadcasts) and to raise extra revenue to hire additional help. Should the Kickstarter drive have flopped, Mars says he would have been winding the show down. Its roaring success means Mars is able not only to make more episodes, but think beyond the third season and into new related projects, such as a book. He is not, however, planning to tap Kickstarter again. Since the show will have proved its viability and popularity, underwriters should be knocking on Mars's door.
benton.org/node/131948 | Economist, The
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TV NEWS MISTAKES
[SOURCE: The Wrap, AUTHOR: Tim Molloy]
Is TV news making more mistakes? Or are they just more obvious? There are at least two possibilities at work, both involving the crush of tweeted, Tumbl'd and wall-posted information that besieges anyone with access to a laptop or a nice phone.
One: The old-school, TV elite are making more mistakes because of the pressure of competing not just with each other, but with the unwashed, unedited and un-vetted masses breaking stories from their parents' attics.
Two: Traditional journalists are making the same number of mistakes they always have. But the same motley confederation competing with them to break news is also holding them more accountable than ever before. That, fans of accuracy would agree, would be a good thing.
It could be a combination of both. And it remains to be seen whether that will lead to a golden age of accountability in which everyone is kept honest, or an Idiocracy in which people throw up their hands and refuse to believe anything.
benton.org/node/131910 | Wrap, The
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WIRELESS/SPECTRUM

DIGITAL WALLET
[SOURCE: New York Times, AUTHOR: Brian Chen]
Starbucks joined forces with Square, a technology start-up that lets you pay for things with a smartphone. Coming from a company whose cafes seem to be on every corner, that’s a powerful endorsement. Does that mean your phone will soon replace your wallet? That’s hardly certain, because any company offering mobile payments faces a big challenge: convincing people that paying with a phone is safer and more convenient than using cash or a credit card. But the partnership will clearly give a lot more exposure to Square, a company in San Francisco with about 300 employees, and to the idea of mobile payments in general. “The biggest friction has been places to pay,” said Jack Dorsey, the founder of Square, in an interview. He said that with so many different companies trying to get a piece of the market, paying with a phone has been a “fragmented” experience. But the Starbucks partnership should widen the use of Square specifically, he said. Indeed, businesses of all kinds, including big companies like Google, Microsoft and Sprint and small start-ups like GoPago and Scvngr, are hoping to profit from mobile payments — if only they can figure out what kind of system appeals to consumers and merchants.
benton.org/node/131970 | New York Times
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APPLE-SAMSUNG UPDATE
[SOURCE: Wall Street Journal, AUTHOR: Ina Fried]
Everyone knows Apple and Samsung sell a lot of phones. Thanks to earnings reports there is even a pretty good sense of how many both companies sell in total each quarter. However, the Apple-Samsung trial is providing a great deal more detail, including how many of each model both companies are selling, at least here in the U.S. during the time frame at issue in the suit.
Documents filed by Samsung lawyers reveal that, from June 2010 through June 2012, Samsung sold 21.25 million phones, generating $7.5 billion in revenue. On the tablet side, the company sold 1.4 million Galaxy Tab and Galaxy Tab 10.1 devices, producing $644 million in revenue. In terms of individual phone models, the largest in units were the Galaxy Prevail with 2.25 million phones sold, the Epic 4G with 1.89 million phones sold and the Epic 4G Touch variant of the Galaxy S II, which sold 1.67 million units in the U.S. All told, Samsung sold 4.1 million Galaxy S II devices, when all models are included.
From 2007 through the second quarter of 2012, Apple sold a total of 85 million iPhones in the U.S., worth a total of $50 billion in revenue, along with 46 million iPod touches producing roughly $10.3 billion in revenue. From its 2010 launch, Apple sold 34 million iPads, generating $19 billion in revenue.
benton.org/node/131969 | Wall Street Journal | Reuters
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SOFTWARE TITANS ENTER THE PHYSICAL WORLD
[SOURCE: Financial Times, AUTHOR: Chris Nuttall, Sarah Mishkin]
Their brands may look more familiar on a website or a software package, but the names and logos of Amazon, Google and Microsoft are appearing increasingly on hardware as they pursue their mobile ambitions. Not content with providing just the media, services and software for today’s smartphones, tablets and laptops, all three are defining such devices themselves with models like the Nexus smartphone, Kindle Fire and Surface tablets. The imperative is to claim a greater a degree of control and influence over an exploding category – one where, unlike during the PC era, users’ experience of web-based services are shaped not just by the layout of a website but also the weight, size and design of the mobile device they hold in their hands. Internet companies are having to rethink their place in the world, which in turn has led to a revision in how they view hardware.
benton.org/node/131968 | Financial Times
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EDUCATION

WEB LITERACY
[SOURCE: Fast Company, AUTHOR: Cathy Davidson, Mark Surman]
[Commentary] Like reading, writing, and arithmetic, web literacy is both content and activity. You don’t just learn “about” reading: you learn to read. You don’t just learn “about” arithmetic: you learn to count and calculate. You don’t just learn “about” the web: you learn to make your own website. As with these other three literacies, web literacy begins simply, with basics you can build upon. For some it can lead to a profession (i.e. becoming a computer programmer) while for most it becomes part of the conceptual DNA that helps you to understand and negotiate the world you live in. Making web literacy the fourth literacy begins with the premise that not only are humans capable of learning together--we’re doing it, contributing to peer learning online, every day of our lives. That is a major educational paradigm shift, the great gift we’ve been given by those who built the web on open architecture. Web literacy explains the world we live in and gives us the tools to contribute to that world.
[Davidson is a professor at Duke University. Mark Surman is the executive director of Mozilla.]
benton.org/node/131913 | Fast Company
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SMASH
[SOURCE: Washington Post, AUTHOR: Vivek Wadhwa]
[Commentary] Blacks and Hispanics constitute only 1.5 percent and 4.7 percent respectively of the Silicon Valley’s computer workers—even lower than the national averages of 7.1 percent and 5.3 percent. The Silicon Valley elite -- like the children at elite prep schools rarely get to interact with minorities, so stereotypes get propagated, which only serves to make the problem worse. Venture capitalists invest in people who fit the “patterns” of successful entrepreneurs that they know, and hiring managers bring in more of the same types of people they have seen achieve success — in other words: people like them. Mitch Kapor established a program called SMASH—the Summer Math and Science Honors Academy at UC Berkeley. SMASH focused on providing project-based learning and integrating science and math into contemporary issues rather than an intensive curriculum oriented towards standardized tests. SMASH provides full funding for high-achieving, low-income high school students of color to spend time on campus for five weeks during the summers after their 9th, 10th and 11th grade years. They are immersed in science, technology, engineering, and mathematics (STEM), conduct experiments and participate in group discussions. They are taught by leading scholars and provided access to the most advanced research equipment. Then they are provided with year-round academic support including SAT prep, college counseling, and other support to ensure their academic success. The results speak for themselves: 100 percent of SMASH graduates have been accepted to competitive four-year colleges, and the overwhelming majority persist as STEM majors. Kids from under-performing public schools who are eligible for free lunches have often never heard of MIT or Middlebury or Morehouse, but those are campuses now populated with SMASH alumni.
benton.org/node/131955 | Washington Post
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STORIES FROM ABROAD

SCRUTINY FOR VODAFONE-TELEFONICA
[SOURCE: Financial Times, AUTHOR: Daniel Thomas]
Vodafone and Telefónica will next week move a step closer to completing a deal to pool their network infrastructure in the UK, although they must convince regulators that combining these assets will not add up to anything like a merger. The concern for regulators is that fewer separate networks would mean a risk of reducing differentiation in network quality, some analysts warn. The other two mobile operators in the UK – Everything Everywhere and Three – already share masts. This would mean, says one senior telecoms executive, that there could be fewer groups at the infrastructure level in the mobile market than there would be in the fixed-line market in the UK. They are expected to submit their plans to the Office of Fair Trading early next week. Those close to the process say that the OFT interest is routine, and that their submission is a move to guarantee a regulatory timetable. Analysts, however, warned that the deal to merge basic broadcast networks could be scrutinized carefully by the regulators.
benton.org/node/131960 | Financial Times
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MADRID MEDIA INTERFERENCE
[SOURCE: Financial Times, AUTHOR: Miles Johnson]
Spain’s government is facing mounting criticism for political interference in the country’s main state broadcaster after a string of high-profile departures of journalists considered critical of the ruling Popular party in recent months. Several of the broadcaster’s most prominent news journalists have left on acrimonious terms, following a move by the government of Mariano Rajoy earlier this year reversing a law making key appointments at the state Radio y Televisión Española network subject to approval by a two-thirds majority in parliament.
benton.org/node/131958 | Financial Times
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