Just to Clarify

Musings on Media

Can you guess what the swine flu, the Horizon gulf oil spill and the Toyota recall crisis all had in common?

They are all examples of what I am calling media feeding frenzies.  What do I mean by media feeding frenzy?  (MFF)  They are events that typically exhibit the following characteristics:

1/  They burst into public’s awareness

2/  They tend to have an emotional component

3/  The “noise” escalates quickly

4/  Reports of the damage/risks escalate

5/  Often Congress will jump in and hold hearings

6/  Coverage dies suddenly

Let’s look at swine flu as an example.  We first started hearing about this risk in 2009.   It was emotional because it involved death.  News mentions skyrocketed. We were told that as many as 200,000 people could die.  (Just in the USA.)  No hearings in this case, as many of the reports were coming from the government.   Then suddenly, it falls from our radar screens.

Or how about the gulf oil spill? It shot into the news.  It was emotional because it involved livelihoods.  We saw pictures of oil-covered animals.  Estimates of the damage stretched to the hundreds of billions of dollars.  We heard that tar balls would be found up and down the Eastern seaboard.  (Carried in the Gulf Stream.) 

And the example we are asked about regularly is Toyota.

This is a case where I can give you some back-story.  Toyota is a company that for years was lauded for its manufacturing prowess.  They are a company that takes its time to study an issue.  Once it has determined a solution, it implements decisively.  These movements usually occurred in precise increments that added up over time.

Over the decades this worked very well for Toyota.  But one requirement is that the facts are known.  In the absence of facts, Toyota would get stuck in the “study phase.”

Now extend this to the issue of unintended acceleration—the issue at the heart of Toyota’s troubles earlier this year.  Unintended acceleration (UA) is a catch all for an occurrence when a vehicle accelerates unexpectedly and in a manner the driver can’t control.  Characteristic of UA is that it can’t be replicated.  The driver reports a problem that does not reoccur.

This means that root causes are impossible to determine.  And because the problem can’t be determined, no solution can be developed.

In such a situation, Toyota’s culture offered no guidance, other than to keep studying. 

In other words, a complex, hard to replicate problem like unintended acceleration was tailor-made to trip up a previously sure-footed company like Toyota.

What was really happening?

First, UA is a problem that is felt across the industry.  Every car company gets complaints about UA.  Earlier this year we learned that some Toyotas—and other manufacturer’s vehicles, frankly—have a gas pedal design that allows stacked floor mats to slide up and jam the pedal.  This might explain why over the past few years why complaints for UA with Toyotas have climbed above the industry average. 

We also had not one, not two, but four separate congressional hearings to look into this issue.  Toyota and NHSTA, the government agency responsible for safety both took heat for dithering in the face of complaints. 

But did we learn what was actually behind this industry wide problem?  No.  Toyota was fined, but not for building defective vehicles.  The fines were for delays in notification.  (This is why we launched a $1M prize earlier this year.  The prize will be awarded to submitters that can identify a repeatable cause of UA.)

I have listed three examples of media feeding frenzies.  I am sure you can think of many more.  They are not a new occurrence.  They have been occurring for years.  But the pace of occurrences has been accelerating.

As with many things, we can blame the Internet.  On the Internet, the rewards are great for being first.  (Rewards being traffic, and more pointedly, money.)   Ad networks mean anyone can start a blog, and easily monetize their traffic.

Moreover, traffic flows to the pieces that are the most extreme; the headlines that are the most alarmist.  Extreme is a relative measure.  What was once extreme becomes the new norm.  So the race to be first and the most extreme means creating a spiral that exaggerates and pushes the boundaries of the truth.

And here is my real point:

Undoubtedly swine flu, the gulf spill and UA are all bad things.  But when the truth is obscured, bad policy can result.  With swine flu, we had 71M doses of vaccine that went to the landfill.  (Even after contributing over 60M doses to poorer countries.)  With the gulf oil spill, we had the government—by their own reports—buying skimmers that were not needed so as to be able to be shown to be acting.  And with Toyota we have been spinning once again around an issue we are no closer to solving. 

I can see the risks, but I don’t have a solution.  Are we all to develop a cynical shield?  To stop being unduly influenced by news reports, will we just become desensitized?

What is your take?

Even Today, Reporters Need to Get the Story Right

Last week I was writing about modern media.  A central idea was that even today, there is a need for reporters to get a story right. 

I did an interview last week that was triggered by a piece in Investors Business Daily.  The piece is a good example of getting the story wrong.

There are legitimate points in the article.  Should tax dollars be used to subsidize the sales of vehicles that feature favored technologies, for one?  (The article features the Volt, but there are dozens of vehicles that currently qualify—at least in theory—as you can see from this list.)

Where the article goes off the rails is when it goes after the Volt’s fuel economy claims.  The official EPA ratings are not yet available, but the article uses the findings of various publications.  What the article doesn’t bother to clearly point out is that these are figures showing possible mileage when the Volt is in gas mode; when the batteries are fully depleted.  This puts the vehicle in the worst possible light, as you are basically hauling around—at a minimum—a heavy set of batteries that are serving no purpose. 

I suppose if you purchased a Volt and never plugged it in, you could expect this kind of mileage.  But, really, how likely is that?

Now I understand that vehicles are complicated.  It is easy to get confused.  And that GM has set itself up for some of this by over-promising on a couple of the Volt’s key features. 

But this article comes off more as a rant than reporting.

You can read the IBD article here.

A Role for Brands in Media

The Internet has certainly “democratized” publishing.  Anyone can start a blog and instantly be a reporter.  (Even me.)

As I pointed out yesterday, there is more to being a good reporter than simply having a blog or a column.  It also means getting the story right, being skeptical and verifying facts.

This is where brands play a role.  They can give consumers a signal as to which media consistently conform to these standards—and which do not.

At least it should work this way.

I have been surprised over the past few days at the level of confusion over the government’s $7,500 tax credit program.  Not just among blogs, but traditional media as well.  The idea being proposed was that if the government is offering a tax credit of $7,500 to buyers of the Chevy Volt then the government has designated the Volt as an EV.

Obviously these reporters did not check their facts.  At its core, the tax credit program is about spurring battery development—not engines.  As such, it is largely based on the size of the batteries in a vehicle.  The vehicle must have an electric motor, but can also be powered by a gas engine.  The Nissan Leaf gets a $7,500 credit.  So does the Chevy Volt.  The Toyota Prius Plug-In Hybrid also gets a rebate.  We are estimating around $2,500—a lesser amount as the vehicle has smaller batteries.  Bottom line, this program makes no attempt to limit the credits to EVs.

We issued a press release yesterday to try to clean up the confusion.  You can read it here.

If you are interested, you can find a list of all the vehicles that currently qualify for tax credits or other government subsidies here.  (The list is longer than you might think.)

Finally, if you want an example of a story that got the tax credit story wrong, you can read one here.  (The article also missed that GM does now acknowledge that the gas engine provides power to the wheels in some circumstances.)