Tag Archives: Research in Motion

Discover Canadian innovation by staring deeply into your own navel and Mike Laziridis discusses manure (really) at the AAAS Fri., Feb. 17, 2012 afternoon events

It was an afternoon event (1:30 – 4:30 pm PST) at the American Association for the Advancement (AAAS) 2012 meeting in Vancouver, “Searching for the Right Space for Innovation.” I realized it was going to be a bunch of academics discussing their research about the Canadian scene; I just didn’t expect it to be so thoroughly self-involved. There was one moment of extreme excitement with everyone madly scribbling or keyboarding. David Wolfe from the University of Toronto mentioned that there is interest is funding risk science research and centres (apparently the Univ. of Toronto is about to open a risk science centre of its own). I’m pretty sure it was the smell of money that occasioned all the activity.

Given that this meeting attracts mainly US scientists and others from outside Canada, I was hoping for a more expansive view of Canadian innovation (the good, the bad, and the ugly). The relentless focus on the minutiae surprised me. I realize that for these academics what I perceive to be minutiae is vitally important. (That’s always true  if you are deeply involved in a topic. I feel much the same way about passive and active voices but the only people who care to discuss this topic at length [I mean 20 or more minutes; occasionally you meet someone who’s prepared to argue you {the writer} into the ground but they usually lose interest as the discussion continues] are other writers.)

Given that the AAAS meeting is attracting academics from many different disciplines and from jurisdictions outside Canada, I found this discussion disappointing in its provincialism.

This session was followed by the big event of the day, the plenary lecture by Mike Lazaridis billed as “The Power of Ideas.” One of the founders of Research in Motion (RIM), the company that produced the Blackberry, Lazaridis is well known as a successful technology innovator. He recently stepped down (or was pushed) from his position (with Jim Balsillie) as co-president and co-CEO of RIM after a very bad year (2011) for that company.

In technology circles, there’s a phenomenon where the people who founded the company can grow it to a certain point but no further. Lazaridis and Balsillie grew their company well past the point where most Canadian entrepreneurs have to quit. RIM is quite an extraordinary accomplishment by any standard internationally and I’m not sure why Lazaridis and/or his handlers feel they have to gild it past levels considered tasteful by baroque standards.

Lazaridis is a good speaker and I wish the material had been better. I’m referring specifically to the part where he posed a thought experiment (his term for it) whereby the Blackberry is sent back in time to some giants in the field electronics, Michael Faraday and James Clerk Maxwell.Is there anyone who doesn’t realize that these 19th century geniuses would be hard put to understand the device?As for sending back some textbooks so they could read about the technology, unlike Lazaridis I’m not convinced that would be helpful. Apparently Lazaridis learned technology by reading the technical manuals first. Laziridis has a different starting point than either of these geniuses not least of which was a cultural context that allowed him to grapple with what was then a ‘new’ technology.

Lazaridis did announce that there will be a new centre opening, the Mike and Ophelia Lazaridis Quantum Nano Centre (QNC) at the University of Waterloo (Ontario, Canada). I gather the new opening date is later this year (2012);  it was supposed to open during summer 2011.

There were some charming bits to the talk (high school experiences) and he’s charismatic. As for the manure, this was mentioned in the context of the first urban planning meeting ever held in the 1890’s in New York City. Lazaridis set this up as a joke asking us what we thought the big problem of the 1890’s urban environment could be. I imagine it was meant as a launch point for something more germane to the ‘big ideas’ theme but I knew the punchline (I happened to see an episode of Nova where this information was featured), was tired, and Lazaridis does not appear to have a gift for delivering a comic line so I left. There you have it: day one.

Organization for Economic Cooperation and Developement’s (OECD) Science, Technology and Industry 2011 Scoreboard

The OECD Science, Technology and Industry Scoreboard 2011: Innovation and Growth in Knowledge Economies is making a bit of a splash with regard to its analysis of patent quality. From the Sept.23, 2011 news item on physorg.com,

The Organization for Economic Cooperation and Development (OECD) has published its Science, Technology and Industry Scoreboard for 2011 and one section shows that patent quality over the past 20 years has declined dramatically, mainly the authors say, due to excessive litigation by so-called non-practicing entities that seek to exploit patent laws. The result they say, is a glut of minor or incremental patent applications that add little to scientific progress.

Mike Masnick at Techdirt weighed in on the matter in his Even The OECD Is Noting How Dreadful Patent Quality Is Negatively Impacting Innovation posting with an oft-repeated suggestion,

Of course, the real way to fix this problem is to make the bar to get a patent much, much higher. If you do that, you get less [sic] bogus patent apps being submitted, and it makes it easier to reject such bogus patents.

What Masnick means by bogus is clarified in this quote from the Sept. 23, 2011 news item,

The problem it appears has come about due to the rise of non-practicing entities [patent trolls]; groups that form for the sole purpose of applying for patents in the hopes of suing someone else who happens to use the same ideas, rather than as a means for building an actual product; though not all of the rise can be attributed to such entities as large corporations have apparently become much more litigious as well.

Canada’s Research in Motiion (RIM), maker of Blackberry mobile devices,  was sued by a non-practicing entity, NTP, Inc. Here’s a little more about the situation (from a Wikipedia essay on NTP),

NTP has been characterized as a patent troll because it is a non-practicing entity that aggressively enforces its patent porfolio against larger, well established companies. The most notable case was against Research in Motion, makers of the BlackBerry mobile email system.

In 2000, NTP sent notice of their wireless email patents to a number of companies and offered to license the patents to them. None of the companies took a license. NTP brought a patent infringement lawsuit against one of the companies, Research in Motion, in the United States District Court for the Eastern District of Virginia. …

During the trial, RIM tried to show that a functional wireless email system was already in the public domain at the time the NTP inventions had been made. This would have invalidated the NTP patents. The prior system was called System for Automated Messages (SAM). RIM demonstrated SAM in court and it appeared to work. But the NTP attorneys discovered that RIM was not using vintage SAM software, but a more modern version that came after NTP’s inventions were made. Therefore the judge instructed the jury to disregard the demonstration as invalid.

The jury eventually found that the NTP patents were valid, that RIM had infringed them, that the infringement had been “willful”, and that the infringement had cost NTP $33 million in damages (the greater of a reasonable royalty or lost profits). The judge, James R. Spencer increased the damages to $53 million as a punitive measure because the infringement had been willful. He also instructed RIM to pay NTP’s legal fees of $4.5 million and issued an injunction ordering RIM to cease and desist infringing the patents. This would have shut down the BlackBerry systems in the US.

There was a settlement made by RIM with NTP in 2006. Simultaneously however, RIM continued to request patent reexaminations and so the patents are still being fought over.

All this makes one wonder just how much innovation and invention could have been stimulated with the funds used to fight and settle this court case.

Intriguingly, RIM was part of a consortium of six companies that during July 2011 successfully purchased former communications giant Nortel Networks’ patent portfolio. From the July 1, 2011 article by Charles Arther for the Guardian,

Apple, Microsoft, Sony and BlackBerry maker Research in Motion are part of a winning consortium of six companies which have bought a valuable tranche of patents from the bankrupt Nortel Networks patent portfolio for $4.5bn (£2.8bn), in a hotly contested auction that saw Google and Intel lose out.

Early signs had suggested that Google might be the winning bidder for the patents, which will provide valuable armoury for expected disputes in the communications – and especially smartphone – field.

The result could give Apple and Microsoft the upper hand in any forthcoming patents rows. [emphasis mine] Microsoft is already extracting payments from a number of companies that use Google’s Android mobile operating system on the basis that it owns patents that they were infringing. Oracle has big court case against Google alleging that Android infringes a number of Java patents, and claiming $6.1bn in damages.

The other two companies partnering in the consortium are EMC, a storage company, and Ericsson, a communications company.

As Arthur’s article makes clear, this deal is designed facilitate cash grabs based on Nortel’s patent portfolio and/or to constrain innovation. It’s fascinating to note that RIM is both a target vis à vis its NTP experience and a possible aggressor as part of this consortium. Again, imagine how those billions of dollars could have been used for greater innovation and invention.

Other topics were covered as well, the page hosting the OECD scorecard information boasts a couple of animations, one of particular interest to me (sadly I cannot embed it here). The item of interest is the animation featuring 30 years of R&D investments in OECD and non-OECD countries. It’s a very lively 16 seconds and you may need to view it a few times. You’ll see some countries rocket out of nowhere to make their appearance on the chart (Finland and Korea come to mind) and you’ll see some countries progress steadily while others fall back. The Canadian trajectory shows slow and steady growth until approximately 2000 when we fall back for a year or two after which we remain stagnant.

Canadian business triumphs again! US company acquires Cananano Technologies

As I have noted on more than one occasion, the ‘success’ model in Canadian technology-based businesses is predicated on a buy-out, i.e. develop and grow your business so you can sell it and retire. The news about Canadian Nano Technologies (Canano) fits very well into this model. From the Jan. 12, 2011 news item on Nanotechnology Now,

Arkansas-based NanoMech, Inc. announced today that it has acquired Canadian Nano Technologies, LLC (Canano).

Canano (www.CanadianNano.com) provides custom engineered nanopowders designed to solve unique problems, adding value to products that span multiple industries including electronics, agriculture, solar energy, and aerospace. The company was founded to develop and commercialize applications of pure metal nanopowders. Using a proprietary gas condensation process partially based on research carried out at Los Alamos National Laboratory, Canano produces a wide variety of high-quality nanoparticles. Their proprietary process is unique and offers significant improvements over other nanoparticle production/collection processes.

NanoMech is a leading designer and manufacturer of nanoparticle-based additives, coatings and coating deposition systems.

Richard Tacker, Founder and CEO of Canano said, “Our customers have seen the value that our custom-engineered nanopowders bring to their products, and as a result the demand for our materials is growing rapidly. By joining NanoMech we can take advantage of their excellent management team, nanomanufacturing expertise, and scale up our production capacity to serve existing and future customers.”

The Canadian technology certainly has some interesting applications,

The nanopowder technology applications include advance methods of improving: nutrient replacement fertilizers and environmentally safe pesticides and conductive inks for printed circuit boards, RFID’s, photovoltaic printed solar cells, solar connectors, surface coatings, new generation ballistics, RF shielding, self-cleaning surfaces, solar heaters, condensers , silicon wafers, solid rocket fuels, and primers. Other applications include textiles, nano fabrics for clothing and car seat covers, odor free materials, cosmetics, sunscreens, deodorants, lip balm, cleansing products, surface protectants, cleaning chemicals, antibacterial coatings, scratch resistant surfaces, thermal barriers, super hydrophobic, dielectrics, wound dressings, lighter, stronger sports equipment, smart materials, air purifiers, water filtration and bio-aerosols, safety, sun and high definition glasses, non-reflective and smart shielding, odor free refrigerators and washing machines, automotive parts, chip resistant paints, non-corrosives, cement, concrete, and fuel savers, and much more.

Meanwhile, the discussion about innovation in Canada continues as we try to figure out why we aren’t better at innovating as per a Jan. 12, 2011 article by John Lorinc for University Affairs. (Thanks to Rob Annan for the tip via Twitter.) Lorinc notes in his article,

In its ninth report on the state of Ontario’s competitiveness, the task force headed by Roger Martin, dean of the University of Toronto’s Joseph L. Rotman School of Management, argues that low productivity in the country’s manufacturing heartland has led to low prosperity, revealing an “innovation gap.” Professor Martin writes that public policy is more concerned with science-driven inventions that, while very important to society, won’t necessarily lead to products and services that consumers want – and thus products and services that could improve Ontario’s innovation capabilities. [emphasis mine]

I am not sure that a focus on ‘science-driven inventions’ is the big problem. Certainly our inventions seem attractive to large foreign companies and corporations as per the Canano experience and many others. The article even points out that Apple is currently pursuing RIM, which is, for now, the largest Canadian technology company.

The perspective from William Polushin from McGill  is closer to my own,

For many years, William Polushin has taught a core international business undergraduate course at McGill University’s Desautels Faculty of Management. Each year Mr. Polushin (who’s also founding director of the Desautels program for international competitiveness, trade and innovation) polls his students about their attitudes towards entrepreneurship and innovation by asking whether they see themselves as the next Bill Gates – in other words, as individuals who will come up with an innovation that could be a game-changer. Year after year, the response rate is consistent: only about 10 percent say they see themselves in this kind of role. By comparison, at a recent conference on North American competitiveness in Mexico City, he asked the students in the audience to raise their hands if they saw themselves running their own businesses in the future. “Well over half put up their hands,” he says.

The results of his straw polls tell a story. Canada has not been especially successful at fostering an innovation mindset among successive generations of business grads and entrepreneurs. Mr. Polushin says, “We don’t have a strong risk orientation in our own country.” [emphasis mine] Most of his students aspire to work in large companies, even though the supply of Canadian-based multinationals continues to shrink due to consolidation. The result, he says, is that much R&D and innovation activity occurs elsewhere.

For a bit of contrast,

Although he’s based at the epicentre of Ottawa’s policy machinery, veteran Statistics Canada economist John Baldwin has a message that runs sharply counter to much of the conventional wisdom that emanates from the capital’s think tanks. “There’s an awful lot of innovation taking place,” says Dr. Baldwin, director of StatsCan’s economic analysis division. The problem is that Canadian policy doesn’t recognize it as such.

I think that’s true too and illustrates the point that discussion about innovation in Canada is complex and nuanced. I recommend reading Lorinc’s entire article.

Todd Babiuk’s article for the Edmonton Journal, Canada failing to create culture of innovation, provides an insider’s perspective from Peter Hackett,

He was, for five years, the president and CEO of a now-shuttered endowment fund called Alberta Ingenuity. The mandate of Alberta Ingenuity, devised to be independent of the provincial government, was to encourage and support innovation in science, technology and engineering. This innovation would lead to spinoff companies that would create fabulous wealth and opportunity for Albertans, attract talented people, and diversify the economy.

Then, all of a sudden, he wasn’t the president and CEO of an independent organization. Alberta Ingenuity has been replaced by Alberta Innovates, and it is operated by the department of Advanced Education and Technology.

“What I take from it, in terms of lessons, is it’s thrilling to watch a group of people take a great product to the market,” said Hackett, in his current office at the University of Alberta’s National Institute for Nanotechnology, where he is a fellow. Before he arrived in Alberta, Hackett did similar work at the National Research Council in Ottawa, spinning Canadian research into businesses.

“But in 15 years of an innovation agenda, honestly,” he said, “governments have accomplished nothing.”

On a YouTube video shot at the Canadian Science Policy Centre in late 2010, Hackett criticizes the Canadian government’s unhelpful and backward interventions into business, through the tax system.

If you’re making a profit, we’re going to help you. But if you’re growing, we won’t. [emphasis mine] In the U.S., it’s completely the other way around. That’s why they have a lot of small companies that grow into big companies.”

In the same video he outlines, briefly and rather devastatingly, the problem with venture capital in Canada. “Government’s intervention into venture capital has ruined the ability for Canadian companies to grow,” he says.

… “We created a tax break for investing in venture capital,” he said, in his office. “So it was about the tax break, not this great company: Facebook, whatever you like. It’s absurd!”

Point well taken regarding the tax break for venture capital. As I recall, there were similar issues with film funding tax breaks. These were addressed and finally, real movies as opposed to ‘tax break’ movies got funded. Part of the problem with government tax programmes such as tax breaks for venture capital funding or film funding is the law of unintended (and counterproductive) consequences and the extraordinarily long time it takes to resolve them.

There was one other point in Hackett’s interview, “If you’re making a profit, we’re going to help you. But if you’re growing, we won’t,” which is well illustrated by Rob Annan’s Nov. 30, 2010 posting (on the Researcher Form blog) where he discusses this phenomenon in the context of Medicago,

Medicago is a Canadian company that produces vaccines in tobacco plants instead of using traditional egg-production techniques. This allows a much more rapid development and deployment of seasonal and pandemic vaccines. Their proprietary technology, currently in phase I and II clinical trials, was developed in Canada thanks in part to government funding …

They’ve been awarded numerous Canadian business and technology awards. They have translated these investments and successes into millions of dollars in private sector investment and a public listing on the TSX. Not bad for a company based out of Quebec City.

So what’s wrong with this obvious success story?

Medicago made the news this week because the US Department of Defense is investing $21-million to build a 90,000 sq ft state-of-the art production facility in North Carolina. The facility will be able to produce 120-million pandemic vaccine doses annually or 40-million seasonal vaccine doses annually. In a news release, the US government recognizes the company’s ability to bolster domestic vaccine supply, respond more rapidly than traditional methods, and bring “hundreds of good paying jobs” to the region.

The 90,000 sq ft facility in North Carolina will dwarf the current estimated 15,000 sq ft dedicated to production in Quebec City, and will inevitably shift the company’s focus south.

The Canadian government’s response?

According to CBC news, Health Canada remains committed to egg-based vaccines …

While it’s discouraging to read about, I like to find hope in the fact that innovation in Canada is being discussed and folks seem to be interested in finding ways to promote and nurture innovation in Canada.