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The ancient arts of persuasion, surprise and (some might say) illusion are clearly comprehended by Bill Cahan, "the Steven Spielberg of annual reports," as one client describes him. Cahan & Associates' extraordinary paperback-sized annual report for General Magic, a voice-technology company, is a case in point. The lavish, 22-foot-long design (which needed hand-gluing in seven sections) was as much a technical accomplishment as a political one (General Magic reported a net loss of 538.9 million for 1998). But Cahan was able to persuade the company that a full-size report containing a hopeful message was warranted nonetheless. "After sifting through information about their technology, we came down to one word: voice." The format, which contains closely cropped photos of people speaking their minds and giving vent to their emotions, was inspired by the can-and-string telephones used in schoolyards, says Cahan designer Bob Dinetz.