The Canadian nationalists are coming out of hiding, expressing concern about the loss of our national icon, Nortel, to those evil foreigners from Ericsson. Our governments had earlier turned their backs on Nortel as we invested in other Canadian firms like, ummmm, General Motors.
Now that the first Nortel asset auction has been completed, we are hearing that the Ontario government wants Ottawa to intervene to ensure that Canada’s national interest isn’t harmed.
These Ericsson folks aren’t the typical raiders. They aren’t Americans – they’re too busy bailing out … well, just about everything.
These are Swedes, Europeans no less.
People who play hockey and curling almost as well as we do. They eat herring three times a day. Herring isn’t really fish; it is what fish eats. Are we really going to let a treasure like Nortel fall into the hands of people who eat bait?
Before we allow Ontario’s Finance Minister to bash these folks too much, we should remember that Ericsson Canada is already one of the largest R&D; organizations in Canada, having invested more than $2B in Canada over the last 10 years. Of course, Ontario may consider that to be foreign investment, since Ericsson has such a large Montreal-based research centre. The Montreal labs have been around for 20 years, and represent one of the most important locations for Ericsson’s wireless network development, with more than 1500 people, Montreal is its largest R&D; centre outside Sweden.
Ericsson’s Montreal presence is important enough for Canada that it is featured on a government website that speaks about why companies should invest in Montreal as the:
Site of an ICT cluster built on the success of leading companies including Bell Canada, Electronic Arts, Ericsson Canada, CGI Group, IBM and Ubisoft International
Ericsson has been in Canada for more than 50 years and it has established deep relationships in this country. Ericsson executives participate in leadership roles in Canada’s R&D; and technology community, including our university engineering programs and CANARIE. Ericsson Canada’s CTO works with me on an advisory board for a University of Toronto’s Engineering graduate program.
Ericsson has another R&D; centre in Vancouver with more than 200 people; its Toronto headquarters employs 150 people.
I’ll be watching to see how we stick-handle our way around welcoming Ericsson investment in jobs in Montreal but discourage them keeping jobs in Ottawa. Our government’s response will have implications for the willingness of foreign companies to continue investing in Canadian jobs.
You could say I’ll be waiting with baited breath.
Update [July 28, 9:30 am]
Mark Evans writes about The Politics of Nortel’s Future this morning.
Do you know if anyone (other than Nortel and everyone involved in the "salking horse" auction) has done any publicly available analysis of Nortel's LTE patents? When I read the press coverage, I am unclear as to whether the bulk of Nortel's LTE patents are included in the Ericsson purchase. I have seen a few media clippings which suggest that much of this intellectual property is still up for grabs, and could be purchased by RIM in a separate auction. I am not an engineer, but I am curious to know whether it is possible for Canada to "have its cake and eat it too" (that is, get the benefits of the Ericsson purchase, while at the same time giving RIM access to LTE technology).
I tend to agree with the underlying message of your post that it is very dangerous for the Government of Canada to block this transaction…
David Laliberte
Cayman Islands