While heading up to my three times a week 6:00 AM basketball game at the YMCA yesterday, I couldn’t help but laugh again at one of PRWeek’s cover stories.

The headline screams “Countrywide initiates effort to counter critics.” For those with their head in the sand and don’t know there is a mortgage crisis, Countrywide Financial is one of many beleaguered mortgage lenders. They recently announced with great fanfare the hiring of Burson Marsteller and a new campaign dubbed “Protect Our Home” to ferociously defend it self from it legion of critics.

Well it seems to me based on what I’m reading and hearing, Countrywide, and BM by extension, are going to have a hard time “protecting their home.”

Remember the legend of Hans Brinker? It’s the story of the little Dutch boy who sticks his finger in the dike to prevent it from leaking. BM is the little Dutch boy and Countrywide is the dike. If I’m BM, I’m thinking what do I have to do to help Countrywide survive. Hell with the critics.

There are to many issues swirling around Countrywide and that’s why their survivability is being called into question. These include class action suits, federal regulators being urged to investigate stock trading by Countrywide Financial Inc. chief executive Angelo Mozilo, the precipitous drop of Countrywide’s mortgage lending from a year earlier and Countrywide announcing its intention to eliminate 10,000-12,000 jobs.

BTW, the layoffs are a complete reversal of what the company had been saying just a month or two ago when CEO Angelo Mozilo could hardly contain his enthusiasm about poaching top mortgage brokers from busted outfits like American Home Mortgage and New Century.

BM is going to fail. Not because they’re not qualified to handle such a mess, they are. But because Countrywide’s ability to maintain operations depends on Wall Street funding that can dry up in an instant.

Not only that, I also predict that within the next year we’re also going to see Countrywide folded into Bank of America.

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No matter what the media or pundits say, Madison Square Garden, the New York Knicks nor Isiah Thomas has a PR Problem. Yes, that’s right. There is no PR problem. No need to go into crisis communications mode or circle the wagons.

Now you might get the impression from reading or listening to the news, how can you not, that the world is coming to an end: nobody will ever again step foot in Madison Square Garden, season tickets subscriptions will be canceled, sponsors will drop like flies and no more ad dollars. It’s not going to happen.

The media and pundits don’t know what they’re talking about. What are the media and pundits basing their conclusions on? Kobe Bryant! I certainly hope not. Seems to me Mr. Bryant is doing OK for himself. Michael Vick? Let’s give it a few years.

Fact is, the New York media treat James Dolan, Cablevision, and the New York Knicks horribly, and this suit was fuel for the fire. Come to think of it, you could also include the New York Rangers but winning last season and the addition of high profile players over the summer has kept the media at bay.

My point is this. As long as the Knicks win, the Garden will be filled, season tickets whether they’re partial plans or full season will be bought, sponsors will not abandon the team and ad space on MSG Network will be sold.

As Oakland Raider owner Al Davis once said, “Just win baby.”

Mark my words, once the New York Knicks start winning on the court people will quickly forget. After all, people have short memories.

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The week before Labor Day is always a slow news cycle but things must have really been crawling at a snail’s pace for InformationWeek to run this story…

The gist of the story is eighty-seven percent of consumers said they lost respect for businesses after those companies lost customers’ personal information, according to InfoSurv’s survey of 400 consumers. Tablus, a company that provides systems for protecting software, backed the survey and announced the results Tuesday. According to Tablus, respondents’ comments indicated that a loss of personal information equals a loss of business because consumers believe businesses should place a high priority on maintaining trust and the confidentiality of their information. In fact, 96% of respondents said that protecting customers from data breaches should be a company’s highest priority. Ninety-five percent of respondents said there is no excuse for exposing customers’ confidential information, and 93% said that businesses are obligated to protect sensitive content. Ninety-four percent of respondents said if there’s a technology to prevent the loss of confidential and personal information, all businesses should use it.

Why isn’t this news? First, because it’s old news. A simple Google search would have shown this. Also companies such as Forrester Research, Gartner and Protegrity (full disclosure, Protegrity is a BlinnPR client) have been talking about this subject for months now. In fact, Forrester and Protegrity have actually calculated in real dollar amounts what a data breach could cost a company. And lastly, anybody who closely follows security and data breaches knows that at RSA 2006 and 2007 this topic was presented as part of a panel discussion. How do I know? Yes, I was at RSA but I was also a panelist both years.

This isn’t about bashing InformationWeek or being the ultimate arbiter of what they should or should not report on. I’ll leave that up to people who are legends in their own mind.

No, my point is this. We already know data breaches are harmful to a company’s brand. What we really should be concerned with is making data breaches part of a company’s crisis communications plan. I can tell you from first hand knowledge that data breaches are not and they should be.

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While playing 18 holes of golf at Van Cortlandt Park in the Bronx over the weekend, I read online that it took Monster.com about five days to disclose a data breach where the personal information of a whole mess of grumpy job seekers, hoping that posting their resumes on Monster would result in a life of happiness and prosperity, got stolen.

I can’t answer the question about whether five days was too little or too much, but I can give you an idea about what you need to know before you disclose to customers, the media and in most cases your bank and credit card companies. You need to know what happened, what and how much was stolen, who was affected, and what you are going to do to make sure it doesn’t happen again. Maybe not with 100% certainty what happened or who the perpetrator(s) were, but enough to know generally what broke, so that you can assure customers you will fix it.

This ultimately comes down to a trust game, and I’d advise anyone to have more information (even if it takes a few days extra), then less. Saying “we’re screwed, we just don’t know how big the pole is” doesn’t engender confidence in your customer base. If you can’t get that information after a certain amount of time, then you need to disclose anyway - but understand you’re going to be pummeled ala TJX.

That’s why I harp time and time again about crisis communications. It’s going to happen to you, it’s just not clear when.

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Credit for this entry goes to Henry Blodget at the Silicon Alley Insider…

Five days after Ukrainian hackers busted into a “rogue server” and stole contact info for 1.3 million Monster users, Monster told the users. But it did so in one of the most inscrutable press releases ever written.

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On the front page of this week’s PRWeek there is an article about how Ogilvy Public Relations Worldwide, through a joint venture with Tsinghua University in Beijing, has indirectly helped counsel government ministries and companies in China on communicating with various worldwide audiences about its recent spate of manufacturing debacles and product recalls.

How effective is the counseling when the former head of China’s top food and drug safety agency was sentenced to death this past May after pleading guilty to corruption and accepting bribes?

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Last week, Starbucks placed a video on YouTube responding to a video posted by the Oxfam Charity. The Oxfam video was launched in conjunction with ‘Starbucks Day of Action,’ held December 16th, when activists visited Starbucks locations across the world in protest of the coffee retailer’s alleged mistreatment of Ethiopian farmers.

The Starbucks video calmly addresses the Oxfam allegations, citing an impasse over Ethiopian trademark legalities. Starbucks claims the refusal to sign a trademark agreement with Ethiopia is a stumbling block they hope to resolve on behalf of the farmers. The coffee chain’s representative goes on to refute the contention that Starbucks refuses to pay a fair price for its coffee reserves and, in fact, routinely pays well above commodity price, and above fair trade price.

Unlike many recent ineffectual corporate reactions to social journalism and networking eruptions, Starbucks’ response is unique in that the corporation managed Oxfam’s unconventional assault in a very unconventional way, via YouTube. Regardless of the outcome of this particular incident, the move on Starbucks’ part comes off as unmistakably in touch with today’s communication modes and methods.”

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