The $100 PC That Wasn't and What You Can Learn From That

Coby Electronics Battles False Internet Rumor With Minimal PR, Crisis Management

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YORK, Pa. (AdAge.com) -- If a $100 mini-computer sounds too good to be true, that's because it is. But that didn't matter after a hot online story last week decreed one was on the way from Coby Electronics.

The story began on a small Indymedia website in Arkansas, but quickly spread across the tech digital world, including popular go-to tech sites Engadget and Gizmodo.

The online "article" foretold of a $99.95 Coby midget PC due out in grocery and drug stores by March, complete with quotes from executives, insiders and even competitors. NPD analyst Ross Rubin was quoted as saying that competing on low price is a dangerous gamble.

Analyst spots hoax
Mr. Rubin, one of the first to pick up on the phony story, did actually say that, but it was to the New York Times for an article about Coby Electronics in April 2006. He wrote about his suspicions the $100 PC report was untrue in his blog, "Out of the Box," citing "anomalies in the article" including his pilfered quote and that the supposed marketing executive quoted left the company, all which made him doubt the story's veracity.

A quick call to Coby by Mr. Rubin confirmed that indeed, the article's author, cited as Clarence Hummer, was taking more than poetic license with the facts. Since then Coby and its public-relations agency, Grand Communications, have spent many hours trying to undo the article damage.

"It goes to show just how powerful viral news can be ... and that reputable sites would pick up on it," said Mark Farish, senior marketing manager of Coby Electronics. "It wasn't misinformation, it was disinformation."

Inundated with phone calls, the first thing Coby did was issue a statement internally that the story was untrue. With a script to work from, Coby employees could then convey the truth to customers and suppliers. Retail partners, for instance -- Rite-Aid and Kroger -- were mentioned in the false story, at first causing buyers for those chains to question why Coby would release something like that. Grand Communications also went to work contacting specific news organizations and actively searching and rebutting the false story posts.

Asking search engines for help
Because of the way search engines lists stories with just a few lines, they've been asking sites to put up whole new post instead of just updates that might not be seen at first glance on a search page.

However, Gizmodo posted simply an update that the story was a "hoax," as did Engadget, although the latter tied the hoax update directly to the headline.

But the truth is that on the internet, a story never goes away entirely. Justin Seibert, president of Direct Online Marketing, said that like most online rumors it will remain in cyberspace despite best efforts. Still, he said, there are other things Coby can do to get its side of the story out.

Mr. Seibert said it could buy paid-search advertising against the Coby name, such as a simple text ad: "Heard the rumors? Click here for the truth," and then link to a press release on the company's web page. "What they'd really be trying to do from the search-engine optimization side, is push down as many false stories as possible and bring up the true ones," he said.

Forgoing the press release
Mr. Farish said Coby specifically decided against putting out a press release because the company did not want to give the story any credence. The story, in fact, never did make it past the online tech press and reach into the mainstream media. "We felt a press release would just be validating the fact that they could have that kind of power," he said.

Mr. Farish also said the company decided not to buy search ads against the Coby name to try to correct the story because "then it becomes an expenditure and where does that end? You find yourself held hostage."

In this case, Coby's reputation likely won't take a big hit, Mr. Seibert said, adding that there may even be an upside. "It could turn into a great thing for them," he said. "They can say this is absolutely erroneous, but let us tell you about some of the other good things we're doing here."

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