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The BlackBerry Problem | The Mistakes Series · Revisionist History

• 0:15
  Speaker 1: Pushkin.
• 0:20
  Speaker 2: It dawns on all of us at some point before
• 0:23
  Speaker 2: adolescence that there is something called smart, and it is
• 0:27
  Speaker 2: really rare. Only a small number of people are smart.
• 0:31
  Speaker 2: And then a few years later you have an even
• 0:34
  Speaker 2: more important realization, which is that smart comes in many
• 0:38
  Speaker 2: different varieties. I feel I spent my adolescence cataloging all
• 0:43
  Speaker 2: the varieties of smart. There was my high school friend
• 0:46
  Speaker 2: who had a mind that was a giant sponge that
• 0:48
  Speaker 2: could soak up what seemed like an infinite amount of knowledge.
• 0:52
  Speaker 2: Then I got to college, I met a guy who's
• 0:54
  Speaker 2: thinking seemed effortless. He could be distracted or procrastinating, or
• 0:59
  Speaker 2: dancing at a party, it didn't matter. Somewhere in a
• 1:01
  Speaker 2: back room in his brain was a giant computer that
• 1:04
  Speaker 2: just quietly hummed along, solving one problem after another. Oh
• 1:09
  Speaker 2: then I had a friend who to mind that she'd
• 1:11
  Speaker 2: attached to a giant V eight with like eight hundred horsepower.
• 1:15
  Speaker 2: I'd never seen smart attached to energy like that before.
• 1:19
  Speaker 2: I spent a lot of time in college working on
• 1:22
  Speaker 2: my taxonomy of smart, and along the way I had
• 1:24
  Speaker 2: a third realization that every kind of exceptional intelligence has
• 1:30
  Speaker 2: a downside, a price that person had to pay for
• 1:34
  Speaker 2: being one of the chosen few. And every time I
• 1:37
  Speaker 2: think of that third role, I think of my old
• 1:39
  Speaker 2: college friend Jim Balsley.
• 1:43
  Speaker 1: My mistake in naivety was to think that people were
• 1:48
  Speaker 1: with me. So you're flying around the world, You're trying
• 1:52
  Speaker 1: to get people on side, and you think they're on side,
• 1:56
  Speaker 1: but they're not, and you get blindsided.
• 2:03
  Speaker 2: My name is Malcolm Gladwell. You're listening to Revisionist History,
• 2:06
  Speaker 2: my podcast about things overlooked and misunderstood. This episode is
• 2:10
  Speaker 2: the fourth in our series on mistakes, inspired by Michael
• 2:14
  Speaker 2: Linton and Josh Steiner's book From Mistakes to Meaning, And
• 2:18
  Speaker 2: this story is about the big mistake, the change the
• 2:21
  Speaker 2: life of my old college friend Jim, who I will say,
• 2:25
  Speaker 2: without reservation, is possessed of one of the most remarkable
• 2:28
  Speaker 2: minds I have ever met, and paid a price for it.
• 2:36
  Speaker 2: What was it like for you growing up? You grew
• 2:41
  Speaker 2: up in Peterborough, Yes, I did. And you went to
• 2:45
  Speaker 2: public high school in Peterborough.
• 2:47
  Speaker 1: Yes.
• 2:48
  Speaker 2: Peterborough, For those unfamiliar with southern Ontario is just over
• 2:52
  Speaker 2: an hour east and north of Toronto. It is to
• 2:55
  Speaker 2: Toronto roughly. What I don't know Poughkeepsie is to New
• 2:58
  Speaker 2: York City.
• 3:00
  Speaker 1: My dad was a tradesman, My mom was a homemaker.
• 3:03
  Speaker 2: Your high school, I suspect was a lot like my
• 3:06
  Speaker 2: high school. We're not talking about Exeter No, although actually
• 3:12
  Speaker 2: I don't mean to diss it, because I got an
• 3:14
  Speaker 2: amazing education from fabulous teachers. So what was it like
• 3:19
  Speaker 2: to be you were the smart kid in high school?
• 3:24
  Speaker 1: Yes?
• 3:24
  Speaker 2: What was that like?
• 3:29
  Speaker 1: I don't think they know what to do with you,
• 3:33
  Speaker 1: So I think you're just I think there's a premium
• 3:36
  Speaker 1: on compliance. I think we've learned now that high energy
• 3:40
  Speaker 1: kids need to run around and when they're young, until
• 3:43
  Speaker 1: they're tired. But kind of making them sitting at a
• 3:45
  Speaker 1: desk all day is when they're young, it's really really difficult.
• 3:50
  Speaker 1: Are you talking about yourself? Yes, very much so. And
• 3:54
  Speaker 1: it was just incredibly boring and you just look at
• 3:58
  Speaker 1: the clock and count minutes and.
• 4:00
  Speaker 2: Yeah, did you get in trouble in high school?
• 4:04
  Speaker 1: Yeah? Yeah, a few times. One time, when I was
• 4:06
  Speaker 1: in grade seven, a teacher did a long formula across
• 4:11
  Speaker 1: three or four boards and he said, where did I
• 4:15
  Speaker 1: go wrong? And from the back of the class, I said,
• 4:17
  Speaker 1: when you were born? And Malcolm and he took me
• 4:24
  Speaker 1: out of the class and he held me up by
• 4:26
  Speaker 1: the scruff of the neck and I was my fever
• 4:27
  Speaker 1: off the ground against a locker, and he had me
• 4:30
  Speaker 1: taken out of the math class. And I was just
• 4:33
  Speaker 1: it seemed funny at the time. And then and then
• 4:37
  Speaker 1: a couple months later there was there was a provincial
• 4:40
  Speaker 1: math contest for you know, the ten million people in Ontario,
• 4:43
  Speaker 1: and as a grade seven I came first in grade
• 4:48
  Speaker 1: seven and eighths in Ontario.
• 4:50
  Speaker 2: He was the best math student in the entire province,
• 4:54
  Speaker 2: but he wasn't allowed in his own math class. What
• 4:57
  Speaker 2: did your parents make of you?
• 5:00
  Speaker 1: When I was four years old, they took me to
• 5:05
  Speaker 1: some child psychologist, which was they didn't know what to do.
• 5:10
  Speaker 2: What were you doing for that led your parents to
• 5:13
  Speaker 2: take you to a child psychologist?
• 5:15
  Speaker 1: I don't know, I don't know. We're we're kind of
• 5:18
  Speaker 1: Presbyterian southern Ontario, so you don't really talk a lot,
• 5:23
  Speaker 1: you don't sort of you just sort of carry on
• 5:26
  Speaker 1: and so you don't it's not like this rich unpacking
• 5:30
  Speaker 1: of psychologists kids or something like that. Everybody's just, you know,
• 5:34
  Speaker 1: it's kind of go play outside and you know, try
• 5:37
  Speaker 1: try to make it home for a dinner kind of thing. Right.
• 5:39
  Speaker 1: It was a very different era, very different era.
• 5:42
  Speaker 2: In my taxonomy of smart, Jim has a whole category
• 5:45
  Speaker 2: to himself. I don't mean this in a derogatory way,
• 5:49
  Speaker 2: but Jim has cunning. My brain I was beginning to
• 5:52
  Speaker 2: understand at that time likes to take the long way home.
• 5:56
  Speaker 2: Jim only took shortcuts if life was amazed. Most of
• 6:00
  Speaker 2: us stumble along, retracing our steps from one dead end
• 6:03
  Speaker 2: to another dead end until we finally get to the
• 6:06
  Speaker 2: other side. Jim would see the right path instantly, or
• 6:10
  Speaker 2: more accurately. He would recognize that there's actually a gap
• 6:13
  Speaker 2: in the hedge right at the start, which no one
• 6:15
  Speaker 2: had ever noticed before, with a straight shot to the finish,
• 6:19
  Speaker 2: and he'd just cut through there. And by the time
• 6:21
  Speaker 2: the rest of us stumbled to the end, he had
• 6:23
  Speaker 2: won the trophy, gone home, changed, and was having a beer.
• 6:27
  Speaker 2: This is Canada, remember. Not long after college, Jim met
• 6:32
  Speaker 2: an engineer named Mike Lazaritas who had a little company
• 6:35
  Speaker 2: called Research in Motion RIM, as it was known. Jim
• 6:39
  Speaker 2: becomes co CEO, and to the surprise of absolutely no
• 6:42
  Speaker 2: one who knew him, builds RIM into a multi billion
• 6:45
  Speaker 2: dollar juggernaut. Remember fifteen years ago when everyone had a BlackBerry,
• 6:51
  Speaker 2: first real smartphone with those clickety clackety buttons. That was Jim,
• 6:56
  Speaker 2: So why don't you use a BlackBerry anymore? In the
• 7:00
  Speaker 2: business school case studies about the fall of BlackBerry, there
• 7:03
  Speaker 2: are pages and pages on the rapidly shifting smartphone landscape
• 7:07
  Speaker 2: of the early oughts, miscalculations, the cloud of Apple, all
• 7:12
  Speaker 2: the things that business goal case studies like to dwell on.
• 7:15
  Speaker 2: But I think there's a simpler explanation. I think you
• 7:19
  Speaker 2: need to understand something about my old friend Jim set
• 7:24
  Speaker 2: the stage for me.
• 7:26
  Speaker 1: Sure, it's interesting because when you talk about mistakes, and
• 7:34
  Speaker 1: I do think the biggest mistake in my career when
• 7:39
  Speaker 1: I look back with Rim, we had a fork in
• 7:43
  Speaker 1: the road and I mismanaged the board relationship at a
• 7:48
  Speaker 1: time where I wanted to go left and they decided
• 7:52
  Speaker 1: to go right. And that not only changed the trajectory
• 7:57
  Speaker 1: of the company, it changed the trajectory of the global
• 8:00
  Speaker 1: technology industry.
• 8:18
  Speaker 2: So tell me what do you mean by you wanted
• 8:21
  Speaker 2: to go left and they wanted to go right? And
• 8:22
  Speaker 2: what we're talking about?
• 8:23
  Speaker 1: What?
• 8:23
  Speaker 2: First of all, let's date this what ear are we
• 8:26
  Speaker 2: talking about.
• 8:27
  Speaker 1: We're talking twenty eleven, and a couple things were going on.
• 8:35
  Speaker 1: One our hardware business had grown a lot, but it
• 8:39
  Speaker 1: was under pressure, huge pressure, and there were new operating systems,
• 8:46
  Speaker 1: one from Apple and one from Google. They were putting
• 8:49
  Speaker 1: tremendous pressure on our hardware sales. But our services business
• 8:54
  Speaker 1: was where we made all our money, our messaging services.
• 8:57
  Speaker 1: So that year twenty eleven, we had more profit from
• 9:01
  Speaker 1: our services business than Facebook had total revenue at that time.
• 9:05
  Speaker 1: We're going to talk about BlackBerry, the belaguered smartphonemaker.
• 9:08
  Speaker 2: BlackBerry CEO himself has admitted one of the reasons they're
• 9:11
  Speaker 2: struggling is because they didn't innovate fast enough.
• 9:14
  Speaker 1: I mean, givening like two do twelve prediction with the
• 9:18
  Speaker 1: company that brings us the BlackBerry, and predicting that they
• 9:20
  Speaker 1: were going to be on the bridge of bankruptcy.
• 9:23
  Speaker 2: There were two sides to BlackBerry in those years. There
• 9:26
  Speaker 2: was the phone that rectangular plastic block with the physical keyboard,
• 9:30
  Speaker 2: and there was also a messaging function BlackBerry Messenger BBM.
• 9:36
  Speaker 2: That was what Jim is calling this service business. Hardware
• 9:39
  Speaker 2: and services were separate, and Jim thought that BlackBerry should
• 9:42
  Speaker 2: get out of the physical phone business, which wasn't making
• 9:45
  Speaker 2: any money anymore, and just be in the BlackBerry Messenger business.
• 9:49
  Speaker 1: And so I'd spent a year and a half buying
• 9:55
  Speaker 1: companies to avail a service, to make it an open service,
• 10:00
  Speaker 1: and I'd spent time with the carriers, and they were
• 10:03
  Speaker 1: going to launch it with SMS, call it SMS two
• 10:06
  Speaker 1: dot zero, and it had storage and rich media phone.
• 10:09
  Speaker 2: What he was imagining was turning BlackBerry Messenger into the
• 10:13
  Speaker 2: backbone of the entire smartphone ecosystem.
• 10:16
  Speaker 1: So it's effectively what we know of as social media
• 10:20
  Speaker 1: right now. And there was a small emerging player called
• 10:26
  Speaker 1: WhatsApp that worked cross platform, but we had a multiple
• 10:30
  Speaker 1: of users as they did. And so yeah, I'd beavered
• 10:34
  Speaker 1: away on it. And I thought the board was on side.
• 10:41
  Speaker 1: I thought everyone was on side.
• 10:43
  Speaker 2: Apple had just come out with the first iPhones. Jim
• 10:47
  Speaker 2: was thinking that there was no way little BlackBerry, as
• 10:49
  Speaker 2: fast as it was growing, could compete with Apple or
• 10:52
  Speaker 2: giants like Samsung. But BlackBerry Messenger was a different matter.
• 10:57
  Speaker 2: BlackBerry was dominant in that space and in the version
• 11:00
  Speaker 2: of the world Jim imagined your texting and social media
• 11:04
  Speaker 2: would come bundled with your wireless contract. So the minute
• 11:08
  Speaker 2: you hooked up your new iPhone or Samsung phone to
• 11:10
  Speaker 2: a wireless provider, you'd be using BBM. Stop there, and
• 11:15
  Speaker 2: let's go back, and I want to make sure everyone
• 11:16
  Speaker 2: understands what we're talking about here. So it's in twenty eleven.
• 11:22
  Speaker 2: Many of us still have a BlackBerry, and there's two
• 11:28
  Speaker 2: components here. There is the physical phone and there's also
• 11:34
  Speaker 2: you're talking about a service that could live, a messaging
• 11:38
  Speaker 2: service that could either live on a BlackBerry or live anywhere. Correct, Yeah,
• 11:43
  Speaker 2: that would be the equivalent of WhatsApp became.
• 11:47
  Speaker 1: Is that the math model Facebook and WhatsApp became. That's correct.
• 11:52
  Speaker 1: What at the time was BBM effectively what social media.
• 11:58
  Speaker 1: And the difference would be is it would be in
• 12:00
  Speaker 1: your subscription plan as part of your texting rather than
• 12:04
  Speaker 1: an ad supported social media service. Yeah.
• 12:08
  Speaker 2: So that the goal here or the play was to
• 12:12
  Speaker 2: make the BlackBerry services business the backbone of basically new media,
• 12:21
  Speaker 2: of new social.
• 12:22
  Speaker 1: Media, that's correct, and it would be embedded in your cell,
• 12:26
  Speaker 1: your plan. And I worked with the carriers, the major
• 12:29
  Speaker 1: CEOs throughout Europe and already had two of the big
• 12:35
  Speaker 1: three committed in US. So all you need is enough
• 12:38
  Speaker 1: to keep it going and it eventually tips. So yeah,
• 12:41
  Speaker 1: people would have said, I'm migrating to an android. I'
• 12:44
  Speaker 1: might degrading to an iOS. I'll just take my BBM
• 12:47
  Speaker 1: with me. I'll maintain all my contacts, all my and
• 12:50
  Speaker 1: you remember you had digital voiceover IP happening on those
• 12:55
  Speaker 1: things at that time. You had pictures, you could store them,
• 12:59
  Speaker 1: you established groups, you had status of delivery. All the
• 13:03
  Speaker 1: things that were social media that was emerging at that time.
• 13:06
  Speaker 1: We had that in the BBM.
• 13:09
  Speaker 2: Well, how many users BBM users did you have at
• 13:12
  Speaker 2: the beginning of twenty twelve, say, or the beginning of
• 13:14
  Speaker 2: twenty eleven, eighty million?
• 13:16
  Speaker 1: Eighty million.
• 13:17
  Speaker 2: So you what would you put the probability of of
• 13:22
  Speaker 2: BBM becoming the dominant becoming this kind of dominant player
• 13:26
  Speaker 2: in the in the telecommunications world if you had gone
• 13:30
  Speaker 2: that route, do you think you could have how big
• 13:32
  Speaker 2: do you think you could have grown it?
• 13:34
  Speaker 1: Well, it's the probability that it would have stayed a
• 13:38
  Speaker 1: major force is one hundred percent.
• 13:41
  Speaker 2: That's the vision, he pitches to the board. We're trapped
• 13:44
  Speaker 2: in the maze along with everyone else. Here's the shortcut.
• 13:48
  Speaker 1: Was he right?
• 13:49
  Speaker 2: Of course he was. Jim's always right.
• 13:52
  Speaker 1: So yeah, in the immortal words of the Yoki Barrow,
• 13:56
  Speaker 1: when you reach the fork in the road, you got
• 13:59
  Speaker 1: to take it.
• 14:02
  Speaker 2: So you go tell me about the board meeting. You
• 14:05
  Speaker 2: go to the board, You go to the board, and
• 14:07
  Speaker 2: what happens.
• 14:10
  Speaker 1: Well, they we'd had the board, had brought in consultants,
• 14:17
  Speaker 1: and I was explaining this and presenting this and talking
• 14:22
  Speaker 1: about the strategy, thinking they were with me, and really
• 14:28
  Speaker 1: I was just speaking into just a vacuum of perceptivity
• 14:35
  Speaker 1: and interest to it.
• 14:36
  Speaker 2: Why weren't they with you?
• 14:39
  Speaker 1: I think it was too radical what I was trying
• 14:42
  Speaker 1: to do. I'd not spent near enough time with them
• 14:47
  Speaker 1: explaining it and debating it, which is a lesson I learned.
• 14:54
  Speaker 1: And you've really driven the company strategies for twenty years
• 15:00
  Speaker 1: to a twenty billion dollar company, and you think they'll
• 15:05
  Speaker 1: just follow you.
• 15:08
  Speaker 2: They say, what are you talking about? We're a company
• 15:11
  Speaker 2: that makes phones. An SMS two point zero. Jim's vision
• 15:15
  Speaker 2: for the next stage of BlackBerry is killed just a
• 15:19
  Speaker 2: few weeks before it was supposed to launch.
• 15:22
  Speaker 1: I wasn't consulted. I didn't know it was happening. It
• 15:26
  Speaker 1: was just on the agenda, presented and decided and I
• 15:31
  Speaker 1: called the lead director after that and I said, what
• 15:35
  Speaker 1: what's going on here? This will kill the company? And
• 15:37
  Speaker 1: they say, the decisions made and so I resigned from
• 15:43
  Speaker 1: the board and sold my shares. The remaining shares at
• 15:45
  Speaker 1: that time, and they were extremely confident for a year
• 15:49
  Speaker 1: and a half, marketing campaigns, super Bowl ads, lots of
• 15:54
  Speaker 1: declarations of its future and its success and it's going
• 15:58
  Speaker 1: to be great. And there was just one board member
• 16:00
  Speaker 1: who was from the tech industry and from the telecom
• 16:03
  Speaker 1: industry who called me and said, there's nothing I can
• 16:07
  Speaker 1: do to stop it. This is Mattess. Yeah, And it
• 16:12
  Speaker 1: was just jaw on the floor. I just never experienced
• 16:16
  Speaker 1: anything like that, and I didn't see it coming. And
• 16:21
  Speaker 1: how could somebody be so blind to something like that
• 16:26
  Speaker 1: when it's such a consequential decision. We'll be right back.
• 16:43
  Speaker 2: Jim and I both went to Trinity College at the
• 16:45
  Speaker 2: University of Toronto, which was and still is the smallest
• 16:50
  Speaker 2: and the snobbiest of the colleges that make up the
• 16:52
  Speaker 2: University of Toronto. I met Jim in the first few
• 16:55
  Speaker 2: weeks of freshman year. I had just turned seventeen. I
• 16:59
  Speaker 2: just had eye surgery. So I had a huge scarveting
• 17:01
  Speaker 2: down the side of my face, a massive afro, lots
• 17:04
  Speaker 2: of acne, maybe one hundred and ten pounds, and all
• 17:07
  Speaker 2: the wrong clothes. I was from a small town way
• 17:10
  Speaker 2: off in the countryside. Here I was at swanky Trinity,
• 17:13
  Speaker 2: and I had no idea how the fancy kids dressed
• 17:16
  Speaker 2: and no money to do anything about it. I had
• 17:19
  Speaker 2: a moment of truth, I need to figure out how
• 17:21
  Speaker 2: to fit in. Jim lived across the hall from me.
• 17:25
  Speaker 2: He taught me how to play backgammon. I played endless
• 17:28
  Speaker 2: games at touch football with him. I had a beloved
• 17:31
  Speaker 2: jade tree that I called William F. Buckley, and he
• 17:34
  Speaker 2: used to steal Buckley from my room and put him
• 17:36
  Speaker 2: in some perilous place. And I think the reason that
• 17:40
  Speaker 2: I felt a certain affinity with Jim is that I
• 17:43
  Speaker 2: since he shared my urgency about fitting in, only it
• 17:47
  Speaker 2: was going to be much harder for him than me.
• 17:50
  Speaker 2: First of all, he was from Peterborough. Nobody was from Peterborough.
• 17:54
  Speaker 2: He had further to climb. And second, he was really
• 17:58
  Speaker 2: really ambitious. I mean I was ambitious, but not like Jim.
• 18:02
  Speaker 2: Jim wanted it more. Do you remember what was it
• 18:07
  Speaker 2: like when you came to university. What's your account of
• 18:13
  Speaker 2: your kind of first year at Trinity.
• 18:15
  Speaker 1: Ah, well, it was very intimidating. I found these people
• 18:18
  Speaker 1: from tremendous privilege and just very very intimidating and meeting
• 18:23
  Speaker 1: people with stellar backgrounds. I'd never been on an airplane,
• 18:27
  Speaker 1: I've never been outside of Ontario. Very modest background. Yeah,
• 18:33
  Speaker 1: just tremendously intimidating. I mean, I was smart, but then
• 18:36
  Speaker 1: you'd see Robertson Davies at high table and sometimes his
• 18:40
  Speaker 1: friend north of Fry there and it's like, con Dorothy,
• 18:44
  Speaker 1: this is not Kansas anymore.
• 18:47
  Speaker 2: Just so you know, Robertson Davies and north of Fry
• 18:50
  Speaker 2: were two of the biggest Canadian intellectual celebrities of that era,
• 18:54
  Speaker 2: and we'd see them out our window walking through the
• 18:56
  Speaker 2: college quadrangle God out for a stroll. For those of
• 19:01
  Speaker 2: us from the sticks, this seemed unbelievable. So we just
• 19:05
  Speaker 2: to remember you and I in You were across the
• 19:09
  Speaker 2: hall in our second year, and I remember there were
• 19:13
  Speaker 2: how many people were our floor? Thirteen people on our
• 19:15
  Speaker 2: floor or something like that. I remember telling my dad,
• 19:18
  Speaker 2: I Max Max Max maybe twelve. It was like private
• 19:22
  Speaker 2: school kids and kids who went up for Canada College,
• 19:26
  Speaker 2: you know, and kids who went to it was Did
• 19:30
  Speaker 2: you feel like you had to work harder to prove
• 19:36
  Speaker 2: yourself in that world? What was yours?
• 19:39
  Speaker 1: Yeah? Well, I worked all the time as a kid.
• 19:42
  Speaker 1: I had five or six paper roots, four or five
• 19:44
  Speaker 1: paper roots almost all the time. And then I got
• 19:48
  Speaker 1: summer and winter jobs from grade and seven on. I
• 19:50
  Speaker 1: bought my own clothes. I still to this day have
• 19:53
  Speaker 1: my own pants and darn socks. Yeah, I can darn
• 19:57
  Speaker 1: socks with the best of them. I sew my own
• 19:59
  Speaker 1: buttons on because you learn how to do it. And
• 20:02
  Speaker 1: I'll sit there, watch the news and sew up my
• 20:04
  Speaker 1: clothes all the time. It's very, very funny. I just
• 20:07
  Speaker 1: enjoy sewing. And but I always so I had my
• 20:10
  Speaker 1: own clothes. I stitched in my shirts, I darn socks. Yeah,
• 20:16
  Speaker 1: it's a funny thing, right. And when something rips, I'll
• 20:19
  Speaker 1: you know, my wife says, why don't you buy a
• 20:20
  Speaker 1: new pair sweatpants and sid well, I can fix those,
• 20:23
  Speaker 1: and it's very funny. So I'll sit there with a
• 20:26
  Speaker 1: big thing and do a catch stitch on it, and yeah,
• 20:30
  Speaker 1: and then and so you work all the time, and
• 20:32
  Speaker 1: then you go to school and you you know, I
• 20:35
  Speaker 1: would I would do the math club, and I'd go
• 20:37
  Speaker 1: to basketball, and then I'd go out to a party,
• 20:40
  Speaker 1: and then I'd work all weekend. So yeah, I just
• 20:43
  Speaker 1: I just I work every day.
• 20:45
  Speaker 2: Jim went off to Harvard Business School right after graduation.
• 20:49
  Speaker 2: He could have gotten a job anywhere, but he chose Rim,
• 20:52
  Speaker 2: right near where I grew up in Waterloo, Ontario. And
• 20:55
  Speaker 2: RIM's rise was swift.
• 20:58
  Speaker 1: It's important to understand that that Apple launched the iPhone
• 21:06
  Speaker 1: in January two thousand and seven, and in response there
• 21:12
  Speaker 1: was a very aggressive selling and marketing and device function.
• 21:16
  Speaker 2: Apple supercharged the smartphone category the same way Starbucks supercharged cappuccinos,
• 21:22
  Speaker 2: and in the beginning, Rim was able to ride that wave.
• 21:27
  Speaker 1: So when they launched in two thousand and seven, we
• 21:30
  Speaker 1: were three billion sales. The next year we grew to six.
• 21:33
  Speaker 1: The next year we grew to eleven billion. The next
• 21:35
  Speaker 1: year we grew to fifteen. The next year we grew
• 21:38
  Speaker 1: to twenty billion. Fortune had us in the middle of
• 21:41
  Speaker 1: that time the fastest growing company in the world. Smarter
• 21:44
  Speaker 1: and sleeker now with real time turn by turn GPS navigation.
• 21:49
  Speaker 1: It has the intelligence you require with the beauty you desire,
• 21:53
  Speaker 1: the all new BlackBerry curve.
• 21:55
  Speaker 2: I would drive through Waterloo in those years and see
• 21:58
  Speaker 2: building after building after building with a big RIM logo
• 22:01
  Speaker 2: on it. Even today, my mom lives across the street
• 22:05
  Speaker 2: from a giant recreational center donated to the city by
• 22:08
  Speaker 2: Rim back in now that era Rim Park. It is
• 22:11
  Speaker 2: impossible not to have a certain amount of pride and
• 22:14
  Speaker 2: affection for the guy who used to steal your jade
• 22:16
  Speaker 2: tree and ended up a billionaire. And then at the
• 22:20
  Speaker 2: very height of BlackBerry's success, Jim wanted to go left
• 22:24
  Speaker 2: and the board of directors wanted to go right. But Jim,
• 22:28
  Speaker 2: b this is a good moment for a reflection here,
• 22:32
  Speaker 2: how are they not with you? You've built this thing,
• 22:36
  Speaker 2: You've been this strategic force behind this extraordinary company. You're
• 22:43
  Speaker 2: you know, the device is in the hands of President
• 22:46
  Speaker 2: of the United States. I mean, like, how how is
• 22:50
  Speaker 2: it that they could look at that, they would see
• 22:52
  Speaker 2: what you had done for the company and look at
• 22:54
  Speaker 2: come to this crucial fork in the road, and not
• 22:56
  Speaker 2: even they don't even seem interested in your option.
• 23:02
  Speaker 1: Yeah, Well, Mike and the new CEO Thorston didn't. They
• 23:05
  Speaker 1: were hardware people, and Mike did say right in the
• 23:13
  Speaker 1: end in a meeting before the board meeting, if we
• 23:15
  Speaker 1: do this, it'll kill hardware. And I said, hardware is
• 23:19
  Speaker 1: already dead. And and it's like I told him his
• 23:24
  Speaker 1: dog just got hit by a car.
• 23:26
  Speaker 2: When you look at your what you did, and where
• 23:30
  Speaker 2: do you think the mistake lay?
• 23:32
  Speaker 1: I think it's many things that you're touching on. One is,
• 23:36
  Speaker 1: for sure, you're busy because you're flying around the world
• 23:38
  Speaker 1: trying to enact this shift. I underestimated how a strategic
• 23:44
  Speaker 1: shift is hard for people. You'd much rather have a continuum. Yeah,
• 23:53
  Speaker 1: more time, for sure, more more preparation, more persuasion. I
• 24:00
  Speaker 1: did not spend the time I needed to. I'd always
• 24:05
  Speaker 1: driven the decisions, and they'd always been yes, of course,
• 24:09
  Speaker 1: we'll do what I'm pushing. But ultimately the board held
• 24:13
  Speaker 1: the power. So underestimated their power, underestimated how they were
• 24:18
  Speaker 1: sold in their way of thinking.
• 24:20
  Speaker 2: If we cut to the bottom line, here is you
• 24:24
  Speaker 2: you have a notion of where the company's future lies,
• 24:29
  Speaker 2: which turns out in retrospect to be accurate. Right, yours
• 24:32
  Speaker 2: was the only path. There was no path, the right
• 24:38
  Speaker 2: word fork in the road was only going to lead
• 24:40
  Speaker 2: to disaster. There was no path that BlackBerry was going
• 24:42
  Speaker 2: to emerge a winner by focusing on hardware.
• 24:44
  Speaker 1: Yeah, there's no there's no debate on that now.
• 24:46
  Speaker 2: Yeah, there was at least a decent probability it could
• 24:50
  Speaker 2: have come out on top or at least very healthy
• 24:52
  Speaker 2: in the other path you had. You came up with
• 24:55
  Speaker 2: this idea, You had an enormous amount of intellectual confidence
• 24:59
  Speaker 2: in the accuracy of your decision. But what you what
• 25:06
  Speaker 2: you overestimated, was that you you thought that having a
• 25:10
  Speaker 2: great idea, well supported by evidence would be sufficient to
• 25:15
  Speaker 2: win over a group of intelligent people. And what you
• 25:18
  Speaker 2: discovered was actually no, A room full of allegedly intelligent
• 25:23
  Speaker 2: people need more than an intellectual argument to win them over.
• 25:28
  Speaker 2: They need to have You need to go out to
• 25:30
  Speaker 2: dinner with them seven times and at a lovely restaurant
• 25:34
  Speaker 2: and hold their hand and kind of, you know, make
• 25:38
  Speaker 2: them feel like they're wanted and needed and that you're
• 25:40
  Speaker 2: someone who they can trust, et cetera, etcetera, et cetera.
• 25:43
  Speaker 2: That was the It was all that soft stuff that
• 25:48
  Speaker 2: you underestimated the importance of. You thought it was what
• 25:51
  Speaker 2: you needed was what you needed to be. You thought
• 25:54
  Speaker 2: what was what was most important was to be right.
• 25:58
  Speaker 1: Yeah, yeah, yeah, and yeah no. I do a lot
• 26:03
  Speaker 1: kind of in I do a lot in public policy.
• 26:05
  Speaker 1: And my wife makes a joke. She says, Jim's was
• 26:09
  Speaker 1: why convince when you can confuse?
• 26:13
  Speaker 2: By the way, what's Jim doing as all this is
• 26:15
  Speaker 2: going on trying to buy a National Hockey League franchise,
• 26:19
  Speaker 2: the Pittsburgh Penguins in two thousand and six, the Nashville
• 26:22
  Speaker 2: Predators in two thousand and seven, the Phoenix Coyotes in
• 26:25
  Speaker 2: two thousand and nine. In each case, the franchises were
• 26:29
  Speaker 2: struggling financially, and Jim proposed to move them to a
• 26:33
  Speaker 2: big city in southern Ontario called Hamilton. Was Jim right
• 26:37
  Speaker 2: to want to do this, of course he was. Southern
• 26:40
  Speaker 2: Ontario is home to fourteen million people and at present
• 26:44
  Speaker 2: has just one hockey team, the Toronto Maple Leafs, which
• 26:47
  Speaker 2: is absolutely bananas. They could easily be three or even
• 26:51
  Speaker 2: four more franchises in the Toronto region, and each would
• 26:54
  Speaker 2: be more successful than almost any franchise in the entire league.
• 26:58
  Speaker 2: But could Jim convince the other owners to let him
• 27:00
  Speaker 2: do it?
• 27:01
  Speaker 1: No? He couldn't.
• 27:04
  Speaker 2: I'm wondering, isn't the Penguins story a version of this that?
• 27:10
  Speaker 2: That was another case where you were right. The Penguin
• 27:14
  Speaker 2: should not be in Pittsburgh. The Penguins should be in Hamilton. Right,
• 27:18
  Speaker 2: You are a hundred percent correct. The future of the league.
• 27:24
  Speaker 2: This is a terribly run league by a bunch of
• 27:26
  Speaker 2: idiots who have not understood that Canada is the natural
• 27:29
  Speaker 2: home for has way too few hockey teams, and Hamilton
• 27:33
  Speaker 2: is would be one hundred times better as a home
• 27:37
  Speaker 2: for the Penguins in Pittsburgh.
• 27:38
  Speaker 1: Right.
• 27:39
  Speaker 2: So in both instances, the story of BlackBerry's Folk in
• 27:43
  Speaker 2: the Road and the story of the Penguins, you are correct.
• 27:47
  Speaker 2: And in both instances you cannot convince the board. In
• 27:51
  Speaker 2: one case the rest of the owners and the other
• 27:52
  Speaker 2: case the board of the company. You cannot convince them
• 27:56
  Speaker 2: of the one hundred percent accuracy of your position.
• 28:01
  Speaker 1: Had you done No, I think they're different because one
• 28:05
  Speaker 1: just was never meant One was just never meant to be.
• 28:08
  Speaker 1: It wasn't ever they weren't going to allow it to happen.
• 28:12
  Speaker 2: Was it never going to happen? Is the one blind
• 28:15
  Speaker 2: spot in the otherwise sublime mind of a man like
• 28:17
  Speaker 2: Jim that he can't see how he could have made
• 28:20
  Speaker 2: it happen. You were. Let me, let me, let me
• 28:23
  Speaker 2: let me just I just want to one last point
• 28:25
  Speaker 2: about Pittsburgh, the Penguins. I'm going to imagine a completely
• 28:29
  Speaker 2: different Jim. Imagine. I'm gonna imagine if you are the
• 28:33
  Speaker 2: schmoozer of schmoozers. You are the most kind of gregarious backslapping.
• 28:40
  Speaker 2: You're everyone you know.
• 28:41
  Speaker 1: You're like this.
• 28:43
  Speaker 2: Beloved social bluh. You spend and you had wind and
• 28:47
  Speaker 2: dined and got to know every single owner in the
• 28:50
  Speaker 2: in the NHL, and then you had said to them
• 28:53
  Speaker 2: you buy the Penguins. And then you say to them, guys,
• 28:57
  Speaker 2: this is a bad hockey market.
• 28:58
  Speaker 1: I think.
• 28:59
  Speaker 2: Let me talk to you about a future of the
• 29:01
  Speaker 2: league where blah blah blah blah. Right, is there not
• 29:03
  Speaker 2: a version if you can't do it, because that's not
• 29:06
  Speaker 2: who you are. But imagine a version of yourself where
• 29:09
  Speaker 2: I shave off forty IQ points and I give you
• 29:14
  Speaker 2: a a beer belly and an afshucks like you know,
• 29:19
  Speaker 2: and an endless appetite for Martiniz and steaks, and I
• 29:22
  Speaker 2: send you on a tour of all the good old
• 29:25
  Speaker 2: boys who run NHL franchises. Do you get your way
• 29:28
  Speaker 2: if you do it that way?
• 29:29
  Speaker 1: If you're that person in hindsight, I don't think I
• 29:33
  Speaker 1: see no chance.
• 29:35
  Speaker 2: Go on, really, Oh come on, Jim, this is your mistake,
• 29:41
  Speaker 2: This is your blind spot. Doesn't this drive you? Why
• 29:44
  Speaker 2: am I the only one who's driven crazy by this?
• 29:46
  Speaker 2: They are morons? They are morons. Well, it would have
• 29:49
  Speaker 2: been very, very profitable. There's no question. We had facility,
• 29:53
  Speaker 2: and we had the real estate. Yet it would have
• 29:55
  Speaker 2: been very very proper. It is concentration of hockey fans
• 29:57
  Speaker 2: in the entire world, with hockey fans with money in
• 30:01
  Speaker 2: an underserved market who can't get any tickets.
• 30:03
  Speaker 1: To That's the math. That's the math.
• 30:08
  Speaker 2: Several times times during our conversation, Jim used the word
• 30:11
  Speaker 2: heretic to describe the way other people at RIM, the board,
• 30:15
  Speaker 2: and everyone else viewed him, and I think it's the
• 30:18
  Speaker 2: perfect word. The heretic is the person who strays from
• 30:21
  Speaker 2: the orthodoxy, but not quietly or passively. The heretic does
• 30:26
  Speaker 2: it loudly, without regard for everyone else's sensibilities. I said
• 30:31
  Speaker 2: at the beginning that when Jim and I came to
• 30:33
  Speaker 2: Trinity from the sticks. Both of us were engaged in
• 30:36
  Speaker 2: the project of figuring out how to fit in. We
• 30:39
  Speaker 2: came in with chips on our shoulders, and we had
• 30:42
  Speaker 2: to find a way to remove them without calling too
• 30:45
  Speaker 2: much attention to ourselves. I think I was better at
• 30:49
  Speaker 2: that than he was. My j tree William F. Buckley
• 30:53
  Speaker 2: kept getting stolen because in nineteen eightys Canada, to openly
• 30:57
  Speaker 2: affiliate with a conservative like William F. Buckley was a provocation.
• 31:01
  Speaker 2: So when I got a second j tree, I called
• 31:04
  Speaker 2: it run Dmtree. I put the lyrics on the side
• 31:07
  Speaker 2: of the pot sucker. Jade tree can't grow much higher.
• 31:11
  Speaker 2: All you other jade trees can call me sire, and
• 31:14
  Speaker 2: no one ever stole my run Dmtree. There were simple
• 31:17
  Speaker 2: ways to appease the Orthodoxy, but I don't think Jim
• 31:21
  Speaker 2: really ever wanted to appease anyone. I think he just
• 31:24
  Speaker 2: wanted to find the hole in the hedge. It's how
• 31:27
  Speaker 2: he got out of Peterborough, It's how he made his
• 31:29
  Speaker 2: way to Trinity. It's how he turned a little startup
• 31:32
  Speaker 2: into a juggernaut. There's a famous psychology experiment from the
• 31:39
  Speaker 2: nineteen fifties where infant monkeys are taken from their mothers
• 31:43
  Speaker 2: and given a choice between two inanimate surrogates. Cloth Mother,
• 31:48
  Speaker 2: a toy mother monkey that soft and cuddly, and wire Mother,
• 31:53
  Speaker 2: a surrogate made out of steel wire holding a banana.
• 31:57
  Speaker 2: Which did they choose cloth Mother? They went for short
• 32:01
  Speaker 2: term comfort over long term survival. At the end of
• 32:05
  Speaker 2: the day, I think the rimboard wanted a cloth mother
• 32:09
  Speaker 2: and Jim was wire mother. They weren't rejecting BlackBerry messenger.
• 32:15
  Speaker 2: They were rejecting Jim, And maybe Jim's mistake was simply
• 32:19
  Speaker 2: that he didn't understand that for the rest of us monkeys,
• 32:22
  Speaker 2: a banana isn't enough. Revisious History is produced by Ninabird Lawrence,
• 32:39
  Speaker 2: Lucy Sullivan, and Ben Adaf Haffrey. Our editor is Karen Chakerji.
• 32:44
  Speaker 2: Fact checking by Angelie Mercado. Our executive producer Jacob Smith.
• 32:49
  Speaker 2: Engineering by Nina Bird Lawrence, original music by Luis Quarra,
• 32:53
  Speaker 2: Sound design and mastering by Marcelo di'ela vera. I'm Malcolm Gladwell.