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BlackBerry back to normal, top execs finally go public

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BLACKBERRY services returned to normal Thursday after four days of global outages, but the maker of the popular smartphone faces a new set of challenges as it tries to clean up a public relations headache.

Research In Motion's two co-CEOs -- Mike Lazaridis and Jim Balsillie -- emerged from more than three days of silence to answer questions and apologize again about the biggest outage in the Canadian company's history.

As the troubles wore on this week, RIM (TSX:RIM) offered only a few updates on what was happening as a growing number of BlackBerry users turned to their Facebook and Twitter accounts to express their frustrations.

The Waterloo, Ont.-based company has about 70 million BlackBerry subscribers around the world, and though the technical glitches did not affect everyone, the word of discontent spread fast.

RIM has now stepped into territory where many other major companies have trod in recent years, commonly known as "crisis management" in the public relations industry. It's caused by an event or series of events that could potentially prove disastrous to the organization, if fumbled.

Co-CEO Balsillie defended RIM's decision to wait until the problems were nearly fixed before coming out publicly in a bigger way. He said the company will now turn its attention to addressing BlackBerry users.

"It's a priority, but I do want to say our priority right up until this moment was making sure the system was up and running and operating globally." Balsillie was speaking on a conference call with Lazaridis, a relatively rare appearance of both executives together.

That attitude may have worked in the past, but with the rise of social media in recent years, the urgency of major companies addressing their customers' concerns has reached a new level, some observers say.

"It's important for brands to be perceived as being responsible and perceived as if they care very much about the brand community," said Sidneyeve Matrix, a professor of media and mass communications at Queen's University in Kingston, Ont. "The damage that can be done to the brand is something worth worrying about."

RIM sent out its chief technology officer, David Yach, to explain the problem on Wednesday, the third day when the outages went global. It wasn't until the outage was basically resolved on Thursday that Lazaradis went on YouTube to give an update.

The scripted video, in which Lazaridis spoke directly to the camera while wearing a black polo shirt emblazoned with the BlackBerry logo, was the first instance in which one of the company's co-CEOs appeared publicly to address the outage.

The two executives then quickly scheduled a conference call that was accessible to both the media and the public through the company's website.

Balsillie assured that the outage had nothing to do with the company scaling back its workforce. RIM recently cut more than 2,000 jobs.

The length of the problems has bruised Research In Motion's reputation for reliability and could give consumers and businesses another reason to switch to Apple or Android devices.

RIM had initially told customers its systems were back to normal after an outage affected Europe on Monday, but instead the problems spread to other countries and eventually most of the world.

RIM has long been criticized for keeping customers in the dark over the status of its technical problems, but the dual video and conference call marked a significant change in the way it operates.

"We know that you want to hear more from us and we're working to update you more frequently through our websites and social media channels as we gather more information," Lazaridis told users in the YouTube video.

Shares in Research In Motion closed down 15 cents to $24.12 Thursday on the Toronto Stock Exchange.

RIM rival Apple has become the world's second most valuable company, in part because of its excellent technology, masterful global marketing and strong brand awareness that makes its products a must-buy to millions of consumers.

Apple's success and mounting competition in the consumer tech market has put intense pressure on RIM's business and led to calls from some shareholders of the Canadian technology icon to sell the company or split it up.

In Thursday's conference call, RIM explained that the widespread outage was caused by a technical failure and a backup-system failure in Europe, which caused a massive backlog of emails and texts around the world.

The outages then spread to the Middle East, Africa and hit Canada on Wednesday. Parts of South America, as well as Asian markets, including Hong Kong, Japan, Singapore and India, were also affected.

Lazaridis said Thursday he wanted to apologize to BlackBerry customers.

"All the services are back up globally," he said. "We are and will take every action feasible to address this quickly, efficiently and to minimize the risk of something of this magnitude happening again. "

-- The Canadian Press

Republished from the Winnipeg Free Press print edition October 14, 2011 B4

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