David Sarnoff’s rags to riches story reads like something straight out of a Horatio Alger novel. Starting as an impoverished immigrant from a Russian shtetl, Sarnoff grew RCA and NBC into the first high tech media empire.
Sarnoff’s family immigrated to America in 1900 when he was just nine years old. He learned English, hawked Yiddish newspapers, and completed the eighth grade. Instead of going to a college preparatory school as he aspired, he was forced to go to work to help support his family. He set out to get a job with a major newspaper, but through a series of accidents ended up working for Marconi America.
Sarnoff soon demonstrated the moxie that would take him all the way to the top. Though hired as a mere office boy, he decided to meet the great Marconi and establish a rapport with him. Hearing that Marconi was en route to one of his New York offices after hours, Sarnoff rushed to get there first, and then introduced himself as the American branch’s newest employee. After a nice chat, Sarnoff offered to help Marconi in any way he could. It just so happened that Marconi was looking for someone discreet to deliver flowers and candies to his New York lady friends.
Sarnoff has been accused of claiming more credit than he deserved. He probably exaggerated his role (as a radio operator) in the Titanic disaster. He didn’t invent broadcasting, but starting with his “Radio Music Box” memo in 1915, he certainly did transform a simple idea into a thriving industry.
In a fit of protectionism, the U.S. government forced Marconi to sell his firm to a spinoff from General Electric called Radio Corporation of America (RCA). Sarnoff had earned his place as one of the firm’s top managers. However, he was surrounded by mid-level managers from GE, many who resented a Jew and outsider rising above them in the organization. When they began harassing Sarnoff, he responded with wisdom and maturity, and it proved a turning point in his career.
The mid-level managers began dumping small projects and crackpot inventors in Sarnoff’s lap, while invitations to social events never seemed to reach him. Instead of complaining, Sarnoff made the most of each project, and then invited RCA Chairman Owen D. Young to dinner at Delmonico’s restaurant in New York City (the highly recommended site of several historic business dinners). Over the course of the evening, Sarnoff told Young about his humble origin, his love for America, and the magnificent future he envisioned for RCA. Sandwiched between these inspiring topics, Sarnoff briefly mentioned the problems he was experiencing.
Young got the message and let it be known that when Sarnoff spoke, he spoke with the authority of RCA’s Chairman. Not long after, Sarnoff was promoted to General Manager.
Over the next few decades, Sarnoff proved himself a tough and savvy businessman. However, some critics feel that Sarnoff destroyed two of America’s greatest inventors, Edwin H. Armstrong and Philo T. Farnsworth. Sarnoff was determined that RCA would always be on the receiving side of patent royalties. He knew how to influence government policymakers. And he was a tough negotiator who knew how to bluff and when to just sit and wait.
Sure enough, Sarnoff used his lobbying skills to delay the successful launch of FM radio, and did everything he could to avoid paying Armstrong for the technology. And some suspect that Sarnoff took advantage of the naïve country boy, Philo T. Farnsworth, inventor of the “image dissector” television video camera.
Those accusations are not entirely fair. Sarnoff’s job was to promote the interests of RCA’s employees and investors. He got the better of Armstrong and Farnsworth, but not because he was trying to destroy them. The fact is that RCA made Armstrong wealthy years earlier, and eventually paid Farnsworth a small fortune.