Cnn Stock Quotes

In a report by Sarah Perez, a false story iReport, CNN's citizen journalism site, caused a major drop in Apple's stock. The report said that Apple CEO Steve Jobs suffered a heart attack, and spread across the online community like wildfire. The story has been removed, but before it disappeared it was fact-checked by Silicon Alley Insider, a blog. When asked, Apple quickly set the record straight: Jobs did not suffer a heart attack; it was just a maliciously spread rumor.

"But the damage was already done," says SitePoint blogger Josh Catone. "Apple's stock price fell about 10 percent as the bogus report spread across the Internet during the morning trading session (it has since recovered). Perez says that citizen journalism has failed us, noting that episodes like this reflect poorly on CNN and on citizen reporters who take their responsibility seriously."

"But," asks Catone, "was it citizen journalism that failed us? Or was it the Internet in general? The web is the latest in a string of new technologies over the past hundred years that have continued to shorten the news cycle from days (newspaper) to hours (radio/television) to minutes (blogs/cell phones) to seconds (Twitter)? There is danger in the ever shorter news cycle."

It's not the only time that time a company's stock took a tumble because of a rumor or error that spread widely and quickly as fact across the Internet. The web is hard to control, and a lot of the information on it is bogus.

"A month ago, United Airlines saw their stock plummet 75 percent after a bug in Google news surfaced a six year old story about bankruptcy. Whether caused by a bug in Google's technology or a shoddy content management system at the paper that failed to date, or put the wrong date on the old article is still up in the air. In the age of instant information, the point is that "news" on the Internet can have immediate or disastrous results whatever the source," Catone points out.

These are just but a few of many such incidences. "In May of 2007, a rumor reported on the widely respected blog Engadget -- which is owned by traditional media company AOL -- about delays for Apple's iPhone wiped $4 billion off Apple's market cap in just a few minutes. The stock recovered after Engadget posted a retraction, but again -- a shoddy source led to disaster in just minutes because of how fast information spreads," reported Catone.

"What all these anecdotes tell us is that on the web, rumor has become a very powerful and dangerous thing, Catone concludes. "Much more powerful than it was ten or twenty years ago, when rumors couldn't spread nearly so quickly and could often be squashed by pesky facts before doing much damage."