We’ve seen a trifecta of failures and/or screwups over the past couple of weeks, from three of the world’s technology giants: Apple was shown to be keeping a log of the location of millions of iPhone users, Sony’s PlayStation platform was hacked and millions of customer accounts were compromised, and Amazon’s (a amzn) cloud-hosting service EC2 went down for hundreds of companies. The reasons for these screwups were different, but the reaction from the companies involved was remarkably similar: a conspicuous lack of timely response. Like many others, these tech giants don’t seem to have realized that crisis response is real-time now too.
Apple, of course, is notoriously close-mouthed about this kind of thing, as was seen in the “Antennagate” affair last year, when Apple stonewalled on the issue of its new iPhone 4 antennas and flaws in the unit’s design. And the initial response from Apple co-founder and CEO Steve Jobs in that case was also classic: he reportedly said “Don’t hold it that way.” In this case, there was virtually no response from the company whatsoever to the location-data issue for days, until — again, in classic Jobs style — a statement was made to a single news outlet effectively saying the issue was overblown and/or the result of a few bugs, and that everyone should just calm down (my colleague Bobbie Johnson disagrees). Oh, and a response took so long because it’s really complicated stuff.
Given its past behavior, it’s possible that Apple is beyond help in this area. The company’s approach seems to be that people will unfailingly line up to buy its products regardless of how it handles such PR gaffes, so it may be a lost cause. But Amazon and Sony arguably have a lot more to lose.
Sony in particular — a former technology leader — has not been doing well on a number of fronts for years now, as Apple has taken over virtually every market segment that the technology company used to own. Not only that, but the company is already infamous in computer security circles for its last major fiasco in 2005, the “Sony rootkit” affair, in which users had a virus-like software program installed on their computers without their knowledge if they played a CD. So you might think that the company would try hard to get out in front of the most recent issue — which venture investor and technology analyst Paul Kedrosky described as “among the worst such debacles in modern financial/technical history” — as quickly as possible. Oh, but it’s really complicated too.
Amazon is not nearly as desperate as Sony, but the company has still pinned a lot of its hopes for the future on the success of its cloud-hosting and cloud-based services business, and seeing hundreds of major companies and websites fail — and lose critical data — is a huge issue. And yet, while Amazon eventually did release something that was much closer to an actual apology than anything Sony or Apple came out with, the company still avoided discussing the issue for what seemed like an eternity in Internet time. One Internet analyst said that Amazon’s “anemic public response” was a major flaw, and that arguably wasn’t the only one.
This isn’t an issue just for Apple, Sony and Amazon — it’s something that companies of all kinds are still struggling to deal with. The reality is that social media such as Twitter and Facebook have increased the ability of customers and users to speak out about such issues, and decreased the amount of time that companies have to deal with them. And that means the old approach of taking days to hold “war room” meetings and come up with elaborate PR plans just doesn’t work any more.
Those things still have to be done, but they have to be done a lot faster, and while they are being done someone has to respond, even just to say “We are sorry, we are looking into the problem” (and if you don’t know when to respond, try this flowchart the U.S. Army came up with for responding to blogs). You don’t just get to reap the benefits of real-time when you are a technology company: you also get to see the other side of that double-edged sword when you screw up. And it cuts just as deep.