Viral or AstroTurf ?

Over the past few years, it has become increasingly difficult to easily distinguish between genuine viral phenomena and astroturfing.

I had my suspicions several years ago, but it reached a head with the “Peter Schiff Was Right” video. Even before he announced he was running for Senator in Connecticut, I strongly suspected the heavily edited video was part of a PR offensive, one orchestrated by a Marketing/Public relations firm, designed to look like a grassroots effort.

What were the hints?

• Lots of emails from total strangers — all of whom had garbage (i.e., Hotmail) email addresses — none were from corporate emails;

• Very similarly worded messages; even where the language was not identical, the syntax was;

• Emails typically Blind Copy (BCC) recipients.

It happened again just last week. Lots of emails about this video regarding the FDIC liquidation of insolvent bank IndyMac, which was sold to bidders and renamed OneWest Bank (See The Indymac Slap in our Face. 02.08.10 http://www.thinkbigworksmall.com/mypage/player/tbws/23117/-4630).

The video was inflammatory, filled with accusations of inside dealings and taxpayer giveaways. The tone and background music is ominous, the math goes by too quickly — the entire thing comes across as if its a giant scam that was uncovered.

I noticed right away that many of the “facts” cited in the video were wrong or at best misleading (no, the FDIC is not funded with taxpayer dollars).

Before I wasted too much time fact checking, I looked at the source of video — a site called “Think Big Work Small.” The header on the page is titled “Video Marketing and Mortgage News Designed for Mortgage and Real Estate Sales.” They sell a product called Database Marketing 2.0. (See nearby graphic).

Hence, the obvious first errors combined with what these folks do for a living screamed AstroTurf to me.

I have no problem with self-promotion (‘though I choose not to use a PR firm). However, getting this many facts wrong as part of a campaign to create viral buzz to sell your product strikes me as cynical and sleazy. It was so inaccurate, it forced the FDIC to issue a statement with specific detailed facts about the OneWest transaction.

Entrepreneurs making money is what capitalism is all about. Its perfectly fine if companies want to buy insolvent firms from the FDIC (a competitive bidding process) and can make a profit on the purchase. And I cheer those folks with the savvy and chutzpah to buy distressed assets in the midst of a panic.

Imagine that, a profit on the purchase of distressed assets at a time when no one else wanted to assume the risk !

But Astroturfing in the middle of an enormous and complex political and economic problem? That strikes me as profiteering hucksters distorting hot button issues for personal gain.

That’s quite a difference from what the buyers of Indy Mac accomplished . . .

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Sources:
Supplemental Facts about the Sale of Indymac F.S.B. to OneWest Bank
FDIC, 2/12/2010
http://www.fdic.gov/news/news/press/2010/onewest_lossshareb.html

FDIC Provides Additional Information on its Loss Share Agreement With OneWest Bank
FDIC, February 12, 2010
http://www.fdic.gov/news/news/press/2010/onewest_lossshare.html

Charges in Web Video Bring Unusual Rebuttal From F.D.I.C.
SEWELL CHAN
NYT, February 14, 2010
http://www.nytimes.com/2010/02/15/business/15fdic.html