Blink and you’d have missed it. Apple’s shares briefly fell 10 per cent Friday morning after a CNN-owned website published a false report claiming that Steve Jobs had suffered a heart attack.
Apple quickly denied the report, which appeared on iReport.com, a CNN-owned website that allows citizen journalists to publish “unedited, unfiltered news.” Shares in the company later recovered to trade down just 3 per cent on the day. The SEC is investigating, according to CNN, which called the report “fraudulent.”
Since blogging and other forms of low-cost online publishing broke into the mainstream earlier this decade, investors have grown used to taking unsourced online reports with a grain of salt. But Friday’s incident underlined the risks faced by news outlets that are increasingly deciding to lend their imprimatur to such unfiltered content.
CNN has sought to distance itself from the rogue report, arguing that iReporter.com was set up as a community distinct from CNN itself, with guidelines that allow users to post material free from editorial control.
The guidelines may state that “CNN makes no guarantees about the content or the coverage on iReport.com,” but as Henry Blodget, the former Wall Street analyst turned tech blogger points out, iReport’s affiliation with CNN is inescapable, even to the most casual of web surfers.
“CNN does not profess to be directly responsible for iReport, but its name is at the top of the site. It’s possible that reports like this will significantly damage CNN’s credibility, and we wouldn’t be surprised if this caused them to pull back from association with ‘citizen journalism,’” he says. CNN later said it does not intend to make any changes to iReport. It said that any iReport content used on CNN itself was subject to thorough vetting.
Proponents of deeper integration of user-generated reports with traditional newsgathering argue that the trend is inevitable. “The audience really can generate content, that’s a fact of life,” says Marc Cooper, a professor of journalism at the University of Southern California. In such a world, news companies, investors and the general public all have a role to play in separating fact from fiction. As Dan Gillmor writes:
I don’t know too many details about CNN’s iReport internal systems, but I do know that CNN has been running this kind of risk for some time. The labeling of the site has never been, in my view, sufficiently careful to shout at readers that they should not take for granted that anything they see is necessarily true — or that readers who might make any kind of personal or financial decision based on what they see on the site are idiots.
But, he adds:
The shareholders who panicked are fools. Not the first time. Maybe when enough people get burned after believing things they should ignore, we’ll all recognize that we have to be skeptical of everything — but not equally skeptical of everything.
