Five things we learned from Bloomberg Businessweek‘s history of BlackBerry—including why it turned down Justin Bieber

Five things we learned from Bloomberg Businessweek‘s history of BlackBerry—including why it turned down Justin Bieber

(Image: langleyo) (Image: langleyo)
 

These days, the news out of Waterloo is almost uniformly bad. BlackBerry‘s new line of smartphones bombed quickly after being released early this year, leading to about a billion dollars in losses last quarter. A failed takeover bid left the company with little to do but take on a huge amount of debt. And now John Chen, the company’s interim CEO, is busy reassuring customers that BlackBerry is “still very much alive.” (If you have to say it, can it possibly be true?)

But it wasn’t always this way. On Thursday, Bloomberg Businessweek published a sprawling oral history of BlackBerry, from its rock-star past (when it was still known as Research in Motion), to its Behind the Music-style and-then-it-all-went-wrong present. Here are the highlights, including a special appearance by Justin Bieber.

1. Talking about the company’s stock price carried stiff doughnut-related consequences.
After RIM went public on the Toronto Stock Exchange in 1997, co-founder Jim Balsillie instituted “the doughnut rule.” Employees caught talking about the company’s stock price would have to buy a round of pastries for the entire office.

2. Working for RIM before 2007 was pretty awesome.
Being a RIM executive before the first iPhone was released was a little like being in a hair band before anyone knew who Kurt Cobain was. Chris Key, a one-time global account manager, told Bloomberg about a trip to Bombay, where he was tasked with giving BlackBerry phones to Bollywood stars. “A friend of mine is an editor for Vogue,” he said. “She put me in the VIP section, and I drank champagne and ate strawberries and handed out BlackBerrys to all the celebrities.”

3. Middle management helped sink the company.
While RIM’s stock price was peaking in 2007, management’s ranks began to swell, taking the emphasis off engineering. Eventually, RIM’s phones began to suffer. According to Vincent Washington, a former senior business development manager, “Lazaridis used to come into these meetings, and it was almost like Pulp Fiction, where he’d open the case and there would be this golden glow of devices…Around 2007, the glow was getting a lot smaller every time he came around.”

4. They turned down Justin Bieber.
If there’s one moment of hubris that truly exemplifies RIM’s falling-off period, it’s this: according to Washington, Justin Bieber offered to be the company’s “brand ambassador” for $200,000 and 20 devices. RIM turned him down, because marketing executives thought he wouldn’t last, and Bieber has since become intrinsically linked to the iPhone. (NB: this was five year’s before the Bieb’s year of living dangerously.)

5. The delusion continues.
According to Jeff Gadway, BlackBerry’s current senior marketing manager, “People have fond sentiments about BlackBerry. If people didn’t have that affinity toward the brand, I would be challenged to really believe in what we’re doing.” With BlackBerry’s market share now a statistical blip, and considering the fact that there’s no clear way for it to recover its fortunes, “fond sentiments” may be biggest assets the company has left.