Consumer Groups file Petition to Set Aside CRTC Rogers-Shaw TV merger
OTTAWA, April 27, 2022 – The Public Interest Advocacy Centre (PIAC) and the National Pensioners Federation (NPF) today filed a Petition to the federal Cabinet to set aside a CRTC decision to approve Rogers’ acquisition of Shaw’s broadcasting assets as part of the broader Rogers-Shaw merger. These assets include certain broadcasting undertakings, as well as broadcasting distribution undertakings (BDUs) including cable TV services, and satellite TV services, and to a lesser extent, Internet protocol-based TV services (IPTV).
“Consumers shouldn’t pay for these mergers,” said John Lawford, Executive Director and General Counsel of PIAC. “This Petition is a result of our concern that the CRTC failed to impose enforceable conditions to protect consumer affordability of TV services.”
In both written and oral submissions, NPF-PIAC raised serious concerns about the impact of the acquisition on affordability of TV services, especially for Shaw’s current TV-only customers, that is, customers who subscribe only to cable or satellite TV without any underlying or additional Internet services from Shaw.
NPF-PIAC filed survey evidence with the CRTC demonstrating Canadians, especially seniors, were concerned about price increases in TV service as a result of the deal – and that this concern was greatest for Shaw TV customers.
Petition text: NPF-PIAC Petition re BD CRTC 2022-76 Rogers-Shaw – 27 April 2022 FINAL
Supporting Appendix A (spreadsheet): App A – Environics PIAC Telecomm Merger Tables ST Sept 8-21
Supporting Appendix B (spreadsheet): App B – Environics Phone Survey – Charts for Shaw Customers_12 Apr 2022
For more information, please contact:
John Lawford
Executive Director and General Counsel
Public Interest Advocacy Centre (PIAC)
(613) 562-4002 ext. 125
jlawford@piac.ca
CRTC Approval of Rogers-Shaw Broadcasting Deal Hurts Consumers
OTTAWA – 24 March 2022 – Consumers, especially in the west, will be hurt by the CRTC’s decision today to approve Rogers Communications Inc.’s (Rogers) take-over of Shaw Communications Inc.’s (Shaw) broadcasting interests, including cable TV, IPTV and satellite TV distribution based largely in British Columbia, Alberta, Saskatchewan and Manitoba, said the Public Interest Advocacy Centre (PIAC).
“Shaw customers should get set for higher TV and internet prices, and a ‘forced march’ to Rogers’ Ignite TV platform,” noted John Lawford, Executive Director and General Counsel of PIAC. PIAC intervened, along with the National Pensioners Federation (NPF), before the national communications regulator, the Canadian Radio-television and Telecommunications Commission. The hearings were the CRTC-regulated part of the larger proposed Rogers-Shaw acquisition.
“We were particularly disappointed that the CRTC appears to have completely ignored the potential cost effect on consumers – in particular during a time of extreme reliance of Canadians on broadcasters in Canada to get news and information on critical events such as wars and pandemics,” continued Lawford. “There is an uncritical acceptance of bald assurances of ‘improvements’ to the broadcasting system that we are convinced were disproven by our evidence, that of other broadcasters and independent producers, and the majority of those Canadians who expressed their opinion on the deal.”
PIAC will study its options for continuing to oppose the broadcasting take-over as well as to oppose, before the Competition Bureau and elsewhere, the merger as detrimental to the interests of all Canadians, including in particular seniors and vulnerable consumers.
For more information, please contact:
Public Interest Advocacy Centre (PIAC)
John Lawford
Executive Director and General Counsel
Public Interest Advocacy Centre
(613) 447-8125
jlawford@piac.ca
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PIAC joins in Open Letter to Finance Minister requesting OBSI be designated only bank ombuds
OTTAWA – 24 February 2022 – Today the Public Interest Advocacy Centre (PIAC) joined leading Canadian consumer groups in an Open Letter to Finance Minister and Deputy Prime Minister, Chrystia Freeland, requesting the Minister designate the Ombudsman for Banking Services and Investments (OBSI) as Canada’s only consumer banking complaints Ombuds service.
“We have been asking for the Department of Finance to ensure independent, fair and expeditious resolution of consumer banking complaints by creating a single ombudsman service for over ten years,” said John Lawford, PIAC Executive Director and General Counsel. “We almost gave up hope, but in the Finance Minister’s Mandate Letter, it directed the Minister to create ‘a single, independent ombudsperson, with the power to impose binding arbitration, to address consumer complaints involving banks.’ So, we are requesting the Minister go ahead and right this historical consumer problem.”
PIAC recently recorded an episode of its “We Fight for That” podcast discussing consumer banking complaints in Canada in detail.
For more information, please contact:
Public Interest Advocacy Centre (PIAC)
John Lawford
Executive Director and General Counsel
Public Interest Advocacy Centre
(613) 447-8125
jlawford@piac.ca
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Wireless prices fell by 25%? – Big claims going down.
The Canadian government has been patting itself on the back for what they say in a recent press release is delivery on a promise to ‘reduce cell phone wireless plans by 25%’, three months ahead of its two-year target ending March 2022. To be fair, this headline is qualified in the text of the release which says that they only committed to “track and reduce the costs of mid-range wireless plans by 25% over two years”. But even this limited goal is misleading when the full facts are known.
The claim of success is based mainly on a measurement that is mechanistic and overly restrictive regarding what matters most to Canadians using cellphones today: mobile data. The Government’s measure does not take into account the fact that Canadians use, and expect, more mobile data each year at the same or reduced cost. Likewise, Canadian cellphone companies have for years increased data allowances for roughly the same price every year. In short, a true price cut, let alone one that would drop real prices per contract by 25%, would require a ‘data inflation’ factor. Without allowing for increasing data requirements, one can claim prices have ‘dropped’ if prices stay the same but data allowances rise. This is precisely what has happened, and the normal, expected data inflation dynamic is what the government is claiming as a success and a price drop. It is not a success and prices have not “dropped” in light of data usage growth.
The proof? “Average revenue per user” (ARPU), the industry’s own profitability metric, has remained relatively stable during the past 2 years of COVID-19, with one carrier even reporting an ARPU increase of slightly more than 1% last year. Other cell companies have been attributing 5-10% ARPU reductions to the pandemic cutting into roaming and overage revenues (people are staying home, so they don’t travel and get roaming charges, and many use their cellphones on home WiFi data) as well as the adoption of unlimited data plans. Prior to the pandemic, however, Canadian carriers had the highest ARPU for the least data used in the world in 2017, and probably also in 2019-20. Canadians are actually paying quite a lot for below-average data use.
But what the heck, let’s track the original goal set out in the 2019 mandate letter to the Minister of Innovation, Science and Industry (ISED): “…to reduce the average cost of cellular phone bills in Canada by 25 per cent.” Let’s ignore data inflation. Let’s look then at the remaining sleights of hand the government has used to claim they have achieved even this non-data inflation-adjusted reduction.
First, their pricing data tracks only the average cost of (and note these are all conditions, and if you don’t meet all of them, the data doesn’t go in the data set, thereby vastly decreasing the size of the data set): 1. post-paid; 2. bring your own device (BYOD); 3. unlimited talk and text 4G/LTE plans; 4. in the 2 to 6 GB range; 5. offered by certain ‘flanker brands’ of major wireless providers, namely, FIDO (Rogers), Koodo (TELUS), and Virgin (Bell). [Note, plans from alternative flankers Lucky Mobile (Bell); Chatr (Rogers); and Public Mobile (TELUS) are also generally not included in these flanker plans as they tend to be pre-paid services, operating at 3G speeds.]
Data limits are too low
Canadians’ data consumption is growing each year as networks gain capacity, making tracking 2GB – 6GB plans increasingly irrelevant. As ISED points out “in 2020, the average Canadian used 3.8 GB of mobile wireless data per month.” This is likely much higher in 2021 and 2022. But this 2020 average tells you very little about plan selection. More specific numbers show that in 2020 approximately two-thirds of mobile subscribers had wireless data plans that were 5GB or larger compared to 40% in 2018. If only a third of Canadian mobile users have data plans under 4GB, why are lower prices for small data plans touted as a victory, overall?
5G plans not included
The data tracked does not include 5G service despite its growing availability and demand for the increased speeds and reliable connections it offers. For example, TELUS recently announced that its “blazing fast and reliable 5G network” now reaches 70% of the Canadian population and connects 744 Canadian communities. The absence of this information means a major variable is missing from ISED’s calculations.
Only includes flanker brand plans
The dataset does not include the three premium or ‘flagship’ brands – Rogers, TELUS and Bell and the so-branded plans offered by them. While its often difficult to extract information about flanker brands from the big three, we know that in 2019 and 2020, without the help of their flanker brands, the Big 3 received ~65% of retail mobile revenues (see: CRTC Communications Market Reports, Open Data – Retail Mobile Sector). It is deeply troubling that the providers’ most profitable plans were not tracked.
The data also does not include Shaw’s Freedom Mobile or Shaw Mobile, which collectively had 1,821,514 subscribers in 2020.
You likely won’t get these plans anyway
These plans are offered only to those who “switch” or are new customers. Customers of the same provider (including flagship brands of the same company, as far as we can tell) do not qualify.
In PIAC’s view it is not clear from the government’s materials to what extent existing customers can gain access to the reduced-price plans tracked by ISED. For example, the flanker brands state that select plans (some called ‘starter plans’ or other unattractive names) are available only to new activations, suggesting that the cheaper plans are only accessible to customers who are willing to switch companies (and pay the activation fee, where applicable). ISED does not mention this. In effect, we have Potemkin pricing plans – probably largely maintained by the companies at the target prices to placate the government and give the impression that there are in-market plans with ‘falling’ prices.
And flanker brands are often heavily DIY-service based, meaning unless the customer can navigate the company’s self-serve website, they may have to pay for customer service. Other disadvantages of flanker brands include default to electronic billing, a paucity of unlimited plans, higher data and voice plan overage charges and reduced handset choice (if you are not doing ‘bring your own device’ (BYOD)).
Includes hidden costs and barriers to access
The narrow data selection is further squeezed by the focus on only “bring your own device” plans. Switching during a prior contract where the customer has not yet fully paid out their smartphone, just to do BYOD for this flanker deal, can dissuade many customers from switching if the payout costs to their first, contracted carrier would be high (that is, more than a very few months remain on their initial contract, if it included a ‘subsidized’ smartphone). This further reduces the number of customers likely to use these flanker plans.
Another issue is that companies are able to charge for data overages on these plans. The frequency and quantity of these overage charges are not tracked, meaning ISED has not captured what Canadians with these plans are actually paying. Data overage charges on flanker brands are typically very high.
StatsCan data is misleadingly called in aid
The ISED media release also trumpets: “Wireless prices in general have declined across the board. The Statistics Canada cellular services price index showed a 26.9% decline from February 2020 to December 2021. The government has also observed decreases generally in the range of 22 to 26% for plans 10 GB and larger, which builds on past reductions of 31% for 10 GB plans in 2019.”
Here are some methodological problems with the StatsCan consumer price index (in relation to wireless):
1. StatsCan dropped the cost of handsets from its costing methodology in 2018. As noted above, most customers also buy handsets on installment plans and don’t BYOD. So, the true baseline cost of the wireless market (most consumers ‘finance’ a smartphone with their carrier) is not measured. We note handset prices have been rising to very high levels in recent years and consumers pay these off, usually monthly, over a 2 year period as per the CRTC Wireless Code.
2. The only measure of ‘price changes’ therefore is the change in service prices. But StatsCan compares “consumer profiles” of static data and texting and voice minutes allowances due to the many, rapidly changing offers and the possibility for individually-tailored contracts meaning StatsCan does not account for expected data use growth or, as we label it, “data inflation.” This creates a false impression of ‘falling prices’ – true only if a consumer does not follow normal consumption trends and does not use or demand more data each year or at least at the end of each contract.
What’s the result after two years?
Canadians are still paying some of the highest rates for cellphone service in the world (see: Rewheel’s “Is Canada the most expensive wireless market in the world?” from April 2021).
What’s likely to happen after the Government’s “price drop” measuring period ends in April 2022? Expect even these limited lower-price flanker plans to disappear from carriers’ offerings. Prices on flagship brands likely will remain high and likely will be heavily marketed with smartphones as part of a payment plan. Lately, these plans have been offered with an optional requirement to return the phone after 2 years in order for the customer to pay a reduced amortization of the phone cost. As a result, if this option is taken, unless the customer pays out a final balloon payment to buy the phone outright at the end of the contract, the customer more likely will trade it in and undertake a new financed smartphone with the same carrier, not take a purchased smartphone to market seeking BYOD rates.
What really needs to be done?
To paraphrase Lenin, “What is to be done [about high cellphone prices in Canada]?” The pat answer is “competition”; more specifically, what other commenters have suggested, is competition delivered by:
1. a forced sale of Shaw’s mobile assets to another wireless carrier as a condition of approval of the Rogers-Shaw deal by the Competition Bureau. But it is hard to anticipate which present competitor in Canada could undertake a nationwide rollout of service as a 4th wireless player; and, doing so as a “pure play” wireless operator would be even more challenging, from a market and regulatory standpoint, and extremely expensive and risky; or
2. entry of mobile virtual network operators (MVNO) into the Canadian market. In simple terms, MVNOs are alternative service providers that buy access to other companies’ network infrastructure and offer services via network software and over other carriers’ spectrum, instead of building physical networks or purchasing spectrum themselves. Unfortunately, last year the CRTC issued a decision that claimed to create an ‘MVNO access regime’ that was nothing of the kind – it effectively excluded non-facilities-based competitors and required carriers who did own some facilities to purchase spectrum, at least eventually. We told the government that this decision is irreconcilable with the aim of reducing wireless pricing in our submission supporting Data On Tap Inc.’s petition to cabinet to reverse this ‘MVNO’ aspect of the CRTC decision.
Neither of these options may happen at all; even if one or both do, based on historical events in the wireless market, Canadian competition law and wireless regulation in Canada, neither is likely to succeed.
Rewheel has recently suggested:
“In order to be effective, remedies must include as a minimum the upfront creation of a new maverick mobile network operator. The creation of a new operator can be realized through the divestment of spectrum and mobile network assets to a domestic or foreign owned interested party, passive site collocation obligations and a time-limited national roaming obligation at competitive data rates. The Canadian Radiotelevision and Telecommunications Commission (CRTC) [actually, ISED manages spectrum, not CRTC] could complement the structural remedy by setting aside 5G spectrum for the new entrant and alleviate the short-term competition concerns by mandating MVNO wholesale access obligations at competitive data rates”.
Maybe, but as noted above, a fourth, independent, quasi-nationwide mobile operator might assist, but would face major regulatory and market challenges and past efforts have failed in Canada.
That said, PIAC agrees with Rewheel’s assessment that “Effective competition in the Canadian wireless market can only be achieved by a set of very significant (bold) structural remedies.”
So, how about thinking more radically? Nationalization of the wireless carriers by the federal government? Structural separation of the backbone operations of the wireless carriers from any retail operations, including their own retail wireless carriers, to which they must sell equally and fairly along with all retail wireless providers? Price regulation of all retail wireless services?
Anything short of these remedies, it seems, will only produce these political shell games.
Seniors, persons with disabilities, customers without home Internet get free paper bills for communications services
OTTAWA – 10 February 2022 – The Public Interest Advocacy Centre (PIAC) and the National Pensioners Federation (NPF) today hailed today’s Canadian Radio-television and Telecommunications Commission (CRTC) decision that requires all communications service providers (Internet, wireless, home phone and TV companies) to provide seniors, persons with disabilities and certain customers without home Internet to get free paper bills from their CSPs.
“This is the best result we could get after an unnecessary five year battle with telecom and TV providers in Canada to do the right thing and provide Canadians who said they rely on paper bills to continue to receive them, free,” said John Lawford, Executive Director and General Counsel of PIAC. “We are pleased the CRTC ordered, effective today, that many customers will get free paper bills, but disappointed that all customers will not get this choice and may have to adapt to electronic bills.”
Trish McAuliffe, President of NPF, claimed the decision as a clear victory for seniors rights to important services: “Seniors told us they need paper bills to make sure they understand and pay their bill on time. They rightly said they should not have to pay more for a paper copy of a bill that they then must pay. They are responsible people and now can demand their TV and Internet providers treat them responsibly too.”
PIAC and NPF originally fought for a requirement to provide paper bills in 2018. The CRTC denied this initial application.
“We will continue to argue for consumer rights in telecommunications and broadcasting services for as long as it takes to convince the regulator of the need to vindicate the public interest. We are pleased the CRTC finally put consumers first today,” added Lawford.
The Public Interest Advocacy Centre (PIAC) is a national not-for-profit corporation and a federally registered charity that protects consumer interest in regulated industries such as telecommunications, energy, financial services, privacy and transportation.
The National Pensioners Federation (NPF) is a national, not for profit, non partisan, non sectarian organization of 350 seniors chapters, clubs, groups, organizations and individual supporters across Canada with a collective membership of 1,000,000 seniors and retirees devoted entirely to the welfare and best interests of ageing Canadians.
Public Interest Advocacy Centre (PIAC)
John Lawford
Executive Director and General Counsel
Public Interest Advocacy Centre
(613) 447-8125
jlawford@piac.ca
National Pensioners Federation (NPF)
Trish McAuliffe
President
National Pensioners Federation
905-706-5806
Trish.mcauliffe@npfmail.ca
Campaign: Revising the Criminal Rate of Interest
OTTAWA – (8 December 2021) – Today the Public Interest Advocacy Centre (PIAC) joins ACORN Canada, Momentum and over 30 groups representing anti-poverty, low-income, disability, immigrant and refugee, labour, tenant, progressive policy and related groups to advocate for reform of Canada’s regulation of high cost lending and to create safe and fair credit alternatives for lower-income Canadians.
The campaign and coalition formed around chronic issues of abusive lending and poor access to fair and safe credit but was catalyzed by the Government of Canada’s Budget 2021, which promised federal government review of the criminal rate of interest, payday lending and installment lending in Canada.
The campaign has four major recommendations for advancing credit justice for lower-income Canadians:
- Lower the maximum interest rate to an Effective Annual Rate (EAR) of 36%. Ensure that the maximum rate includes all lending costs.
- Clarify and better enable enforcement. Remove the requirement of an actuarial certificate and approval of the attorney general to prosecute.
- Repeal section 347.1 which provides an exemption for payday lending.
- Ensure access to safe and affordable credit for all Canadians.
The campaign not only seeks to eliminate extreme credit costs to those Canada who can least afford to pay high interest rates, but also to create a new credit facility for lower-income Canadians and to provide a government-backed bridge to consumers who may have become dependent on harmful forms of credit such as payday loans and installment loans.
A full description of our recommendations is found in the attached document: “Revising the Criminal Rate of Interest in Canada” (December 2021).
For more information, or to add your group to the coalition, please contact:
John Lawford (he/him) Executive Director/General Counsel Public Interest Advocacy Centre 285 McLeod Street - Suite 200 Ottawa, ON K2P 1A1 jlawford@piac.ca 613-562-4002 ext 125 [new!] Fax 562-0007 Cell: 613-447-8125Fighting for consumer rights@CanadaPIAC
Judy Duncan, ACORN Canada, canadaacorn@acorncanada.org 416-996-6401
Courtney Mo, Momentum, courtneym@momentum.org 403-204-6180
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CCTS Annual Report 2020-21 Shows Consumer Internet Issues
OTTAWA, 6 December 2021 – Consumers are struggling with Internet services during the continuing COVID-19 pandemic, said the Public Interest Advocacy Centre (PIAC), citing today’s release of the 2020-21 Annual Report of the Commission for Complaints for Telecom-television Services (CCTS).
The CCTC Annual Report shows a 9% year over year increase in consumer complaints during the months of August 1, 2020 to July 31, 2021. Customers raised 12% more Internet-related issues during COVID-19 lockdown, with nearly one quarter of these concerning poor service quality and complete loss of service at a time when Canadians rely on internet services to complete essential activities.
“Increased home internet usage by Canadians during COVID-19 restrictions highlights serious problems with Canada’s Internet industry and regulation,” noted John Lawford, PIAC’s Executive Director and General Counsel. “The CRTC’s ‘Internet Code’ had only 18 confirmed violations despite consumers raising over 13,000 Internet issues – or less than 0.2%,” he added. “That’s a ridiculously low number that we think means the Internet Code has no real substantive consumer protections while consumers are led by regulators and industry to think that it protects them.”
Wireless services continued to be the most complained about service, at 44% of consumer complaints overall, versus 31% for Internet services and 12% each for TV and home phone service. Disclosure issues continue to worsen as they were the top consumer concern (14% of all issues for all service), followed by incorrect charges (13%) and poor quality of service (11%). Within the service quality category, complaints relating to Internet quality of service saw a whopping 48% increase.
PIAC notes that disclosure concerns also are a common issue again this year despite a Canadian Radio-television and Telecommunications Commission (CRTC) Report on Misleading or Aggressive Retail Sales Practices of Canada’s communications providers that clearly described flaws in industry behaviour.
For more information, please contact:
John Lawford
Executive Director and General Counsel
Public Interest Advocacy Centre (PIAC)
613-562-4002 ext. 125 (New)
(613) 447-8125 (cell)
jlawford@piac.ca
C-10: The Legal Issues
Join us and FRPC for C-10: The Legal Issues, a legal conference on Bill C-10, an Act to Amend Canada’s Broadcasting Act!
PIAC supports Data On Tap Inc.’s petition to reverse MVNO Decision
The Public Interest Advocacy Centre (PIAC) today filed a submission to the Governor in Council supporting Data On Tap Inc.’s (DoT) petition to the government to reverse a decision of the Canadian Radio-television and Telecommunications Commission (CRTC) that will prevent more wireless competitors from offering service in Canada
PIAC’s submission supports DoT’s petition to open Canada to true “mobile virtual network operators”, or “MVNOs” which are new cellphone competitors seeking to serve Canadians across Canada.
“The CRTC issued a ‘fake MVNO’ decision to favour only existing cellphone companies and to stop innovative wireless providers like Data on Tap from entering the Canadian market,” stated John Lawford, PIAC’s Executive Director. “But the Rogers-Shaw merger blew up this fiction and showed how fragile the expensive Canadian wireless market is and how far the regulator had to go to prop it up,” he added.
Data On Tap’s application asks the federal Cabinet to overturn the CRTC’s restrictive MVNO definition and to allow true MVNOs, like DoT and many others that could bring Canadians cheaper wireless service now, which the government, recently returned after an election, claimed to support.
PIAC’s submission in support of DoT’s petition is found here and is also posted on the Department of Innovation, Science and Economic’s “Spectrum and Telecommunications – Petitions to the Governor in Council“.
For more information, please contact:
John Lawford (he/him)
Executive Director/General Counsel
Public Interest Advocacy Centre
285 McLeod Street – Suite 200
Ottawa, ON K2P 1A1
jlawford@piac.ca
613-562-4002 ext 125 [new!]
@CanadaPIAC
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Submission of the Public Interest Advocacy Centre (PIAC) to the 2021 Ontario Privacy Consultation
PIAC recently commented on the Ontario Government’s “Public Consultation – Modernizing Privacy in Ontario”. Please find attached three documents:
1) Comments of the Public Interest Advocacy Centre on the above-noted consultation, entitled “Provincial Privacy Reform: A Path to Disorder?”;
2) PIAC’s comments from the 2020 Ontario “Consultations to Strengthen Privacy Protections of Personal Data;” and
3) PIAC’s comments from the Information and Privacy Commissioner of Ontario’s “Strategic Priority Setting Consultation.”
PIAC is strongly opposed to a fragmented privacy regime in which each province adopts their own private sector privacy laws. PIAC has already discussed this position in detail in our submission to the previous Ontario consultation, “Consultations to Strengthen Privacy Protections of Personal Data,” launched on August 13, 2020, and closed on October 15, 2020. For reference, PIAC’s 2020 submission is attached to our submission for this present Consultation. We stand by our position today.
Rather than pressing forward with new provincial legislation, Ontario should focus on strengthening the province’s privacy regime under its existing framework, to better leverage the IPC’s existing mandate to address current weaknesses in key priority areas. There is undoubtedly a great deal of work to be done. PIAC directs the MGCS to, firstly, our October 2020 submission which specifically called for private sector employment privacy reform (which is not done at the federal level and is a lacuna in Ontarians’ privacy protection) and also our attached submission from the IPC’s “Strategic Priority Setting Consultation,” which concluded in January of this year.
PIAC recommends that the Ontario government refrain from taking direction from the reform approach in Bill C-11.
