|Who Stands For Canada|
The NORTEL intellectual property will be on the auction block come Monday morning June 27, 2011. Through a game of high-stakes brinkmanship the coveted portfolio will be and awarded to one of the giants of the tech industry. The Nortel IP, funded in large part by Canadian taxpayers, has been described as a "national treasure" by Mike Lazaridis – CEO of Canada's Research in Motion. Kasim Alfalahi, chief intellectual property officer at Ericsson, said "The Nortel patent portfolio reflects the heritage of more than 100 years of its R&D activities and includes some essential patents in telecommunications and other industries in a statement” A source at INTEL, who has confirmed the corporation is actively seeking to acquire the IP, has referred to the portfolio as a virtual "gold mine". The common term bandied about in the media is "nuclear weapon"... translation being that the successful buyer will wield formidable power within the global Technology industry.
The scope and relevance of the IP is simply breathtaking and stands alone as a monument to Canadian research and ingenuity. We are clearly way beyond Avro Aero stuff folks… archives.cbc.ca this is intellectual property at its most brilliant and lies at the very core and future of the global telecommunications industry. This arsenal of 6,000 patents covers nearly every aspect of telecommunications, internet search, and social networking. Key among them are the "crown jewels" of LTE and 4G patents which industry analysts are touting as the future communications backbone of mobile technology. This industry segment alone is forecasted to experience staggering growth over the next five years. Google, who holds the "stalking horse" bid of $900 Million, refers to the IP as a "formidable patent portfolio" that will assuredly form a key component of their strategic planning.
The Harper government has taken a laissez-faire approach in essentially allowing the industry to decide. "Harper doesn't believe the government should interfere, as long as the foreign takeover abides by the Canadian Investment Act and represents a net benefit to the country. "
So let's then examine the key aspects of the Federal Act that is held up as the legal hurtle to all significant foreign investments and acquisitions. The Act basically stipulates that in determining whether an investment is of "net benefit", the Minister will consider the following factors:
1. the effect on the level of economic activity in Canada, on employment; on resource processing; on the utilization of parts and services produced in Canada and on exports from Canada;
2. the degree and significance of participation by Canadians in the Canadian business or new Canadian business and in any industry or industries in Canada;
3. the effect of the investment on productivity, industrial efficiency, technological development, product innovation and product variety in Canada;
4. the effect of the investment on competition within any industry in Canada; the compatibility of the investment with national industrial, economic and cultural policies; and
5. the contribution of the investment to Canada's ability to compete in world markets.
Based on the Government's position then, the translation would be that retaining the Nortel IP in Canada would be the wrong decision and NOT in the best interests of Canadians. That the intellectual brilliance of LTE and 4G which will become the driving force of mobile technology and forecasted for staggering growth over the next decade, is NOT a "net benefit" to Canadians? I'd love to see former Industry Minister Clement – now promoted Finance Minster - stand up and make that case to Canadians! Especially in light of his comments to justify the federal governments blockage of the Potash sale where he stated empathically that the federal government must do the right thing when faced with difficult decisions. "I believe that my decision today is the right decision in the interests of Canada and in the interests of Canadians and that is my bottom line."
One would be hard pressed indeed to argue that the IP sale does not violate in fact every single one of the above legal factors. It is of such concern that it promoted then Liberal Leader Michael Ignatieff to claim that Prime Minister Harper and Industry Minister Clement would be "wilfully turning their backs on their own law and the future of Canada's technology sector". Quite clearly he perceived that it did not pass the sniff test and make it over the legal hurdle.
Even the US Government is showing more of an interest and concern regarding the impact of the Nortel acquisition. " Realizing the potential for abuse that might result from the sale of Nortel's vast trove of patents, the DOJ is taking an active position in trying to balance antitrust and intellectual property law matters in an attempt to ensure that any company acquiring patents in bankruptcy proceedings do not then unfairly inhibit competition." jetlaw.org The Harper government strategy becomes even more puzzling when one factors in a more international perspective in relation to government investment and protection of intellectual property within the technology arena.
The Chinese government recently stated that China "aspires to have a group of core patents for newly emerging industries and key technology in traditional industries within the next ten years."
President Obama just announced a $500M investment into research within the US Robotic industry. "We have watched countries in Europe and Asia invest heavily in robotics," said Dean Elkins Chairman of RIA." There's no doubt that robotics is one of the most important technologies of the 21st century and the National Robotics Initiative will play an important role in advancing robotics developments," Elkins added.
With regard to Obama's very substantial investments into green energy technology; the U.S. is spending six times more per capita on green energy R&D than Canada and reports are Canada has already lost 66,000 green energy jobs to the U.S. alone.
Can you image the Chinese or American governments adopting the Harper Government position if they were threatened with losing the very heart of their intellectual property? The public and media outrage would be at such an astounding decibel level that politicians would have it shot dead in the starting blocks! It would never see the light of day. While governments around the world are actively engaged in revamping and protecting their nation's intellectual property in addition to pouring funding into research, ours is on the sidelines doing the funky chicken. It just really is that much of a joke folks!
So what are the consequences to Canada's high technology industry in losing the Nortel IP? Are we going to see a ripple effect in the aftermath? Whoever acquires the Nortel patent arsenal will probably put the other tech giants at a strategic dis-advantage. This could very well trigger a feeding frenzy in their attempts to balance the intellectual property scale and strengthen their patent hand. In the high stakes game of intellectual property poker bigger apparently means better. The short term impact could very well be the acquisition of additional Canadian IP entities.
What then is the impact on Research in Motion? Are we witnessing the slow burn of a once glittering star? Is RIM the next Canadian Nortel? Many analysts are projecting their continued slide and eventual acquisition by one of the tech giants - probably simply to purchase market share. What a shame indeed!
Could RIM's future into mobile technology have been re-kindled with the acquisition of the Nortel IP? The answer is most assuredly. Industry analysts have long been reporting that RIM's weakness was its lack of patent punch. Innovation within the mobile device arena is critical today where the competition is coming out with significant upgrades at a dizzying pace. canadaeast.com
The long term consequences of the Harper Government's apparent fiddle while Rome burns policy; could very well result in the almost total erosion of Canada's intellectual property with respect to high technology. The end result being that Canadians would finally be put back in their rightful place as hewers of wood and drawers of water!
In conclusion, the answer to the questioned posed in the title of "Who Stands for Canada?" is clearly established by the evidence which indicates that in this particular case, at this particular time, it most assuredly is not the Harper Government. History could very well, and should judge them harshly… judgement day may in fact be not that far down the road…