Could RIM have responded better to outage?

Users suddenly confronted with life without email

As of late Wednesday afternoon, U.S. Eastern Time, Research in Motion had offered no explanation for the cause of the BlackBerry e-mail service outage that affected users in North America.

Throughout the outage, which started Tuesday evening at about 8:15 p.m. ET and lasted through at least midmorning Wednesday ET, the RIM and BlackBerry Web sites lacked any information regarding the outage. Multiple inquiries to press representatives made via telephone and e-mail were not answered through Wednesday afternoon, although RIM did issue a statement to European reporters earlier in the day, confirming the outage, saying service had been restored to most users and that it was looking into the cause of the problems.

One crisis management consultant said customers expect more details in crisis situations. "The general rule is, if it's really bad get [information] out fast," said James Lukaszewski, CEO of The Lukaszewski Group in New York. "It'd be a far less large situation if they communicated more."

However, another offered the opposite viewpoint. While more communication might help to contain a news story, RIM's focus might instead be on reassuring stock markets, said Mark Towhey, president of the Towhey Consulting Group in Toronto. His company provides crisis management advance and he thought RIM's response seemed appropriate for the circumstances.

If the company didn't know the cause of the problem, whether "something broke" or its network was attacked, it may be better to say little. "In either case, they don't want to sound like they don't know what they're doing," he said.

For customers who don't use their BlackBerries when they aren't working, the outage might not have been a major issue, he said. A BlackBerry customer himself, Towhey learned about the outage when he read news reports Wednesday morning and about an hour later, the service was back.

"For me as a customer, it seems like a minor hiccup," he said.

According to some who posted at BlackBerry message boards -- ironically, one of the larger such boards was on the fritz at least part of Wednesday -- the hiccup wasn't quite so minor. While some posters urged perspective on the situation, others found their ability to work was adversely affected.

While non-BlackBerry users might not quite get the fondness for the handheld devices that leads to them being dubbed "CrackBerries," a Web poll taken Wednesday by telecom expense management firm ProfitLine found that 81 percent of respondents representing enterprise IT and telecom professionals reported operations were disrupted by the outage, with 44.5 percent saying that the effect was "moderate or substantial."

Those findings indicate that "wireless communication has gone from a travel convenience to a mission critical communications tool," Randall De Lorenzo, ProfitLine's vice president, Mobility Strategies said in a statement about the "webinar" poll, which had, coincidentally, been scheduled before the outage. Between 70 and 100 enterprise IT or telecom managers responded to the poll, according to a ProfitLine spokesman.

When a company in a crisis -- which the outage was for at least some users who rely on BlackBerries for e-mail and Internet connectivity -- doesn't give out information, the media might turn to others who speculate about what's going on, Lukaszewski said. Indeed, many press accounts of the outage include speculation from analysts or others in the telecommunications or handheld industries about what might have caused the outage and how the situation could have been better handled.

"Customers want information -- they want to know what's going on," he said. "They expect reputable companies to communicate."

A challenge is presented when a company doesn't have many answers, but even details about the steps being taken to correct problems and estimates about when those might be resolved is better than no information, Lukaszewski said.

At this point, RIM is in the aftermath stage, he suggested. "The issue now is how do they get forgiveness? How do they get their customers to like them again?"

The love so many BlackBerry users have for their devices will be a saving grace, said telecom analyst Jeffrey Kagan. "BlackBerry will take a hit, but it will probably come back because the users are almost rabid. Palm and other competitors should be up on the news. However, the bottom line is, after the next few weeks, we will all go back to trusting again. Until the next disaster."

The very success of BlackBerry devices could well be a factor, he and others suggested. There are some 8 million BlackBerry subscribers worldwide, with more than 1 million added in the quarter that ended March 3, said RIM, which is based in Waterloo, Ontario, when it announced its most recent quarterly financial results. Revenue for the quarter was up 66 percent to US$930.4 million, with net income before adjustments of $187.9 million.

Wall Street at least was proving forgiving. With about 20 minutes to go in the trading day on the Nasdaq exchange, shares in RIM (RIMM) were trading up 2.68 percent at US$134.79.

(Robert McMillan in San Francisco contributed to this report.)

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Nancy Weil and Grant Gross

IDG News Service
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