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The Recycled News Effect: United Declares Bankruptcy … Again

News doesn’t really go away ever, it just gets pushed further down search results. If you had to single out one of the greatest impacts of the Internet on the traditional news media, it would likely be that now just about anyone has access to an instant archive of information from just about any time. Forget microfiche, or library archives, or any other outmoded form of archiving you may have known before … if I want to find a piece on online promotion that I published in Australia 8 years ago, I would go online and find it. Along with this instant archive, however, comes a dangerous side effect that United Airlines (and the entire news media and financial industry) learned about yesterday.

It turns out that yesterday for some unknown reason, an old story that ran in the Chicago Tribune on December 12, 2002 was picked up by the South Florida Sun-Sentinel and run on their homepage as "news." A reporter at an investor information service did a Google search, saw the story and assuming it was current, he posted it with the headline "United Airlines: Files for Ch. 11, to cut costs by 20%" and posted it to subscribers of the Income Securities Advisor, and through Bloomberg terminals. Within an hour, the story spread across the financial industry, setting off a selling frenzy of UAL stock. As Forbes Online reports, "in the span of 10 minutes, 24 million shares changed hands. The stock, trading at $12.45, crashed to $3, according to Nasdaq. So severe was the market’s response that Nasdaq halted trading from 11:06 a.m. to 12:30 p.m."

All this because a single reporter in Florida took an old story from a credible source, assumed it was recent without fact checking and posted it. Though ironic that in this case it happened to be a reporter, you could just as easily imagine this situation coming from a blogger posting an old piece of content as new. What’s the lesson in all this? Perhaps that in today’s world of instant access to news archives, it’s no longer enough to pay attention to what people are saying about your brand today … you need to also focus on what they said yesterday that might be getting recycled so you can correct it before something bad happens to your stock or your business.

Read the full story on Forbes.com >>

Related Story on Mashable: Google Wants To Index Millions Of Old Newspapers >>
 

4 thoughts on “The Recycled News Effect: United Declares Bankruptcy … Again”

  1. Wow, what a debacle. No matter how far technology advances there is still a lot to be said for remembering the basics of reporting news. Where was his editor? It also reminds me that even though most of the news I read is web-based there’s still a very human element involved (for better or for worse). I hope this guy got fired, his position obviously carries a lot of responsibility that he was not careful with. What do others think?

    Cheers,
    Nicole Landguth
    @wondrgirl

    p.s.- I wish I could have gotten in on the $3 UAL stock!

    Reply
  2. I think this is an excellent example of why we should not “forget microfiche, library archives, or any other outmoded form of archiving.â€￾ Search engines make everything a jumble; libraries (or any kind of systematic archiving) make things organized. I say, remember what libraries do, if not the tools they use to do it. Forget microfiche the tool, sure, but remember the benefit of organized information. The folks at that Florida paper realized this benefit the hard way.
    Also, the “librarianâ€￾ bit of my job title requires me to add the tired but true: not everything is online. Publications focusing on web marketing probably are, but all sorts of other industry publications only live in print or restricted databases.
    Excellent note about historical brand management – and a good lesson indeed. Thanks!

    Reply
  3. It seems like the heavens aligned to create this situation – it was believable considering the state of the airline industry, the mistake went unnoticed by multiple editors, no one bothered to call United to double-check the veracity of the news, and the investor looked over the date of the story.

    I guess it goes to show how important online reputation management is – that is, using tools to keep track of online news and tidbits that are released about your company.

    Does anyone know the protocol for handling the settlement of the trades that occurred during those ten minutes? Do the trades stand? It seems like if you took a minute to check the source of the information instead of shooting from your hip, you stood to make a lot of money.

    Reply

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