{"id":22275,"date":"2013-09-11T17:20:53","date_gmt":"2013-09-11T21:20:53","guid":{"rendered":"http:\/\/www.iposgoode.ca\/?p=22275"},"modified":"2013-09-11T17:20:53","modified_gmt":"2013-09-11T21:20:53","slug":"what-a-potential-blackberry-sale-says-about-canadian-innovation","status":"publish","type":"post","link":"https:\/\/www.yorku.ca\/osgoode\/iposgoode\/2013\/09\/11\/what-a-potential-blackberry-sale-says-about-canadian-innovation\/","title":{"rendered":"What a Potential Blackberry Sale Says About Canadian Innovation"},"content":{"rendered":"

In a recent Globe and Mail op-ed<\/a>, columnist Konrad Yakabuski argues that the likely sale and potential breakup of Blackberry would be a major setback to Canada\u2019s innovation agenda.<\/p>\n

And as has been common in commentary, he also draws parallels to the demise of previous research and development (R&D) powerhouse Nortel. As Yakabuski wrote,<\/p>\n

\u201cIf Blackberry is sold \u2013 as seems likely after the board announced a strategic review and hired investment bankers \u2013 it will most likely be carved into pieces. That stands to make Canada\u2019s innovation situation worse. The company, which benefited from government grants and loans in its early days, has given back by nurturing the countless startups for which BlackBerry is a customer or mentor. Nortel played a similar role in its day. The loss of an anchor can compromise an entire ecosystem of innovation, making it even harder for startups to make the leap to commercialization.\u201d<\/p><\/blockquote>\n

The Globe and Mail has been reporting extensively on the company\u2019s future, seen in articles like \u201cThe decline and fall of Canada\u2019s global corporate superstars<\/a>\u201d and \u201cBlackBerry\u2019s future is in pieces<\/a>\u201d.

<\/p>\n

Breaking Down the Issues<\/b><\/p>\n

A quick scroll through the comments<\/a> on any of these articles \u2013 or casual listening across our country\u2019s proverbial water coolers \u2013 makes it clear that the future of Blackberry is a hot button issue. There are camps, there is rhetoric, and there is emotion. But using Blackberry\u2019s current situation as either a symbol of contemporary innovation challenges or as a canary-like indicator for the future of Canadian innovation is problematic.

<\/p>\n

In unpacking the link between Blackberry\u2019s future and its impacts on Canadian innovation, there are two distinct arguments. From the perspective of critics, the hypotheses are that Blackberry is struggling because it lacks innovation; also, the sale of Blackberry will reduce the amount of innovation in Canada. In my opinion, both are logic leaps.

<\/p>\n

Is Blackberry Struggling Because it Lacks Innovation?<\/b><\/p>\n

Ongoing security improvements<\/a>, overwhelmingly<\/a> positive<\/a> Q10\/Z10<\/a> device operating system reviews and the controversial but creative idea to offer platform agnostic BBM technology<\/a> \u2013 as well as the decision to spin the technology<\/a> into a separate company<\/a> \u2013 are clear signs of innovation.

<\/p>\n

There may be better reasons to explain Blackberry\u2019s loss of market share and sinking stock price. These include that the innovations were not strategically aligned<\/a> to maximize appeal with the growing consumer demographic<\/a>, that marketing has been inconsistent and improperly focused<\/a>, or that corporate operations<\/a> or product distribution management<\/a> have faltered with growth. All of these claims seem to hold some truth to them. To say that Blackberry has lacked innovation, however, is, in my opinion, fundamentally inaccurate.

<\/p>\n

Will the Sale of Blackberry Reduce Innovation in Canada?<\/b><\/p>\n

It\u2019s difficult to predict whether any sale or breakup of Blackberry will result in quantitatively less innovation than if the company retains its current corporate structure. If we judge innovation by R&D investment, it would be hard to have mathematical certainty about what Blackberry would have spent over its company future in the event of a sale, and vice-versa. As a result, I would contend that outright, quantitative prediction is a mug\u2019s game.

<\/p>\n

In my opinion, a more intelligent, nuanced response is that R&D is a blunt and sometimes indeterminate measurement of innovation. The Council of Canadian Academies recently completed an expert panel report<\/a> at the request of Industry Canada to assess innovation in Canada. Though it did find many benefits to industrial R&D (IR&D) investment, it\u2019s not the same thing as innovation.<\/p>\n

\u201cIR&D and innovation are not synonymous. IR&D consists of any scientific research or technology development undertaken by Canadian businesses. Innovation, on the other hand, is the broader concept that can be defined as \u2018new or better ways of doing valued things.\u2019\u201d (P.9)

<\/a><\/p><\/blockquote>\n

The panel listed four key areas of R&D strength in Canada, including:<\/p>\n