IFC Films
Jay Baruchel as Mike Lazaridis in “BlackBerry”
A decade ago, the BlackBerry phone was a ubiquitous appendage in any power center, from corporate boardrooms to the halls of Congress. Barack Obama famously used a BlackBerry throughout his presidency, even long after the phone’s mass popularity had waned. The “Crackberry,” as it was dubbed, became the status symbol of the era, projecting a new image of a workaholic and information-obsessed elite always emailing, texting, and “connecting,” at all hours, day and night.
Then, as soon as it revolutionized the cellphone market, the BlackBerry was eradicated from the commercial landscape by Apple’s iPhone. The company went from a nearly 50 percent market share at its peak in 2008, to near zero (save Obama) only a few years later.
The new film BlackBerry charts the rise and fall of the once-dominant tech company, and how it lost out to Apple. It’s one of several brand-centric films that have come out this year, a genre that Hollywood seems particularly enthralled with at the moment. Many of them appear to be acting as thinly veiled promotional campaigns. There’s Ben Affleck’s new movie Air about Nike’s successful signing of Michael Jordan and producing his wildly popular sneakers, which recently sold to Amazon Prime; Apple TV produced the Tetris movie released earlier this year; and Jerry Seinfeld is making a film about … Pop-Tarts.
The BlackBerry movie, for the most part, avoids the pitfalls of the genre, which all too often presents either hagiographic or sociopathic portraits of the genius founder triumphing over the market, especially when it comes to the tech industry. The procession of biopics about Steve Jobs after his death and The Social Network’s portrayal of Mark Zuckerberg are prime examples of the former; The Dropout (about Elizabeth Holmes) or WeCrashed (about Adam Neumann) TV shows, examples of the latter.
Instead, BlackBerry presents a uniquely incisive look at the political economy of the 2000s, and how it shaped the arms race among tech firms to develop the smartphone. That period not only killed off BlackBerry but also two consumer electronics giants of the 20th century, Nokia and Motorola, and led to the rise of one of today’s most powerful corporations, Apple.
The film tells the story of BlackBerry’s co-CEOs Jim Balsillie (Glenn Howerton) and Mike Lazaridis (Jay Baruchel), who embody the dissonance between Wall Street financialization and the early ethos of Silicon Valley. As it turns out, this culture clash also makes for a great comedic duo.
Today, tech firms have become synonymous with Wall Street, often concerned more with their stock valuations than new products. That trend is aptly embodied by Apple, which hasn’t developed any truly novel device since Tim Cook took over in 2011. But in the early years of the tech revolution, many pioneering engineers in the Valley were wary of finance’s short-term returns model, which they saw as anathema to innovation.
The film’s plot captures how the fusing of these conflicting business interests was resolved inside BlackBerry and eventually honed by Apple.
In the early years of the tech revolution, many pioneering engineers were wary of finance’s short-term returns model, which they saw as anathema to innovation.
Directed by the Canadian actor and filmmaker Matthew Johnson, the film loosely adapts a 2015 book about the decline of BlackBerry called Losing the Signal. The authors Jacquie McNish and Sean Silcoff have lauded the film for its general accuracy, though of course embellished and simplified for dramatic effect.
After getting fired from his investment banking job for advising clients to commit tax fraud, Balsillie joins Research in Motion (BlackBerry’s parent company), which at the time was a fledgling startup with piles of debt working out of a tiny office space in Waterloo, Ontario. Founders Lazaridis and Douglas Fregin (Johnson, the director) epitomize the 1990s tech-utopian spirit: idealistic, disheveled-looking engineers and Star Wars nerds. Balsillie, always in a suit, is high-tempered and returns-driven, a man of Wall Street.
Lazaridis brings Balsillie on board to sort out the company’s finances, but immediately comes into conflict with his management style. Balsillie is set on squashing the company’s startup culture and turning it into a high-efficiency corporate enterprise to court investors. He is only concerned with getting a product to market and goosing stock prices, while the founders are meticulous and obsessive about creating a high-value product that will revolutionize communications.
The financial stakes only heighten when BlackBerry faces the threat of a hostile takeover, which requires the company to focus obsessively on keeping its stock price valuation high enough to stave off a sale to outside investors.
Another flashpoint in this tension plays out over whether to move BlackBerry’s manufacturing to China. Balsillie insists outsourcing to China will lower costs and allow the company to boost sales, but Lazaridis, the head of product development, refuses because he believes it will worsen the cellphone’s quality. Throughout the film, Lazaridis neurotically fixates on a high-pitched humming noise emanating from all kinds of electronics manufactured in China, which he bemoans as representing the “emptiness” of modern consumerism.
As the BlackBerry begins to dominate the cellphone market, Balsillie’s business strategy wins out and refashions the company to Wall Street’s liking. Lazaridis eventually turns into a company man and a convert to Balsillie’s obsession with returns, leaving his business partner Fregin as the only holdout defending the original startup spirit. In the corporate world, it’s a tale as old as time, though a potent one.
The subtext of the film captures how competition between firms is mediated by contracts and other agreements, shaped by government policies rather than the nature of the market.
Trade is one arena where this takes place. The iPhone certainly conquered the smartphone market because of its unique product features and design. But over the past decade, Apple also undeniably gained an advantage by setting up shop in China and mastering global supply chains as they’d been organized by decades of U.S. trade policies. BlackBerry took a hit by abstaining, while other smartphone makers didn’t refine their supply lines as effectively.
In the film, the main battleground between BlackBerry and Apple is their business partnerships with the telecommunications monopolies, which control access to the market. Apple notoriously deferred entering the smartphone market for years because the company didn’t want to deal with the slow and sclerotic carriers, which Steve Jobs called the “four orifices.”
BlackBerry and Apple first had to convince the telecom giants that it was worth making the investments to upgrade their infrastructure in order to carry smartphones without the servers crashing from data overloads. The film accurately conveys that the large carriers, like AT&T and Verizon, really were the primary business clients that the smartphone makers competed over. Consumers came second.
The telecom carriers also put their thumbs on the scale during the smartphone arms race, both collecting rebates from the cellphone makers and also periodically discounting certain products to increase their sales. Even if the phone makers took losses in the short term, sales needed to continually increase for the carriers to justify making investments and ensure more smartphone users could access the network without it crashing.
The carriers were important middlemen in determining the playing field for competition between BlackBerry and the iPhone. Though the iPhone very well might have won out anyway, the rebates and discounts collected by the carriers distorted markets and caused inefficiencies for all tech players involved.
The BlackBerry movie perhaps unwittingly conveys a key dictum of the neo-Brandeisian school of anti-monopoly thought: that market competition isn’t just a natural phenomenon, but structured by laws and other policies.
Also, it’s funny.
