"In this proud land we grew up strong
we were wanted all along
I was taught to fight, taught to win
I never thought I could fail
" - Peter Gabriel - Don't Give Up
In one year on the job as technology columnist I have covered a lot of ground. Scrolling through the archive gives one the impression that I seem to have an opinion on just about anything. The cynic in the crowd might say "de-focused". I prefer "well-versed"... So, it behooves me as an opinionated pundit to look forward at the next year and give my forecast of the BC technology scene.
The PwC Technology Forecast was held on March 31st. If you didn't go, you missed a good presentation and you didn't get the book. The book is fabulous. PwC will gladly sell it to you now for US$450. The presentation was a general overview of trends in the entire technology sphere with particular emphasis on e-commerce and communications. It was nice to see the collective forehead slapping and light bulbs going on when the presenter gave simple examples and analogies to the crowd. Quick example: By connecting devices like pop machines to real time inventory and pricing systems, Coke could replenish the machines only when needed and change the price of an ice cold Coke based on the temperature outside. Here we are, in 1999, and everybody seems to be getting it. Hallelujah!
The 1999 Something Ventured BC Technology Forecast breaks down into two basic categories: The Environment for Technology and the Technology People.
Borrowing again from PwC and its Pillars for Growth (isn't it amazing what 15 people in suits at $300/hr can come up with?), I break down the Environment into four sections:
· Industry Players
The People category is made up of three sections:
As I delve into my forecast, keep in mind that each of the sections can impact the whole in very positive or very negative ways. Some can help or hinder in a much shorter time frame, while others take longer to change.
BC's Technology Environment
Government - Oh, this is too easy. It's no fun to pick apart government policy when they are such an easy target. Lucky for me, the NDP just gave me their forecast to build on. After so much promise in 1998, after it appeared that Andrew Petter was getting it, after a strong push by top industry leaders for a break in tax on stock options for the employees and management in technology companies, after all that… nothing. Squat. OK, a lower overall tax on small business and exemptions from corporate capital tax, but nothing geared to technology.
For 1999, I see a dismal year of trying to make Victoria see the light. The Feds are into good old liberal protectionism in 1999. Sheila Copps is likely to slap a Canadian quota on any good or service by the end of the year. The big buzz in Ottawa is now over "productivity". A bunch of armchair economists are going to point fingers at each other over how we can be more productive. We must all look ahead beyond 2000 for positive impacts from this sector.
Industry Players - Good news here. Our largest companies are also among our fastest growing. Electronic Arts, Seagate Software, Creo Products, MDA, Ballard Power, MDSI and QLT are all going gangbusters. These are the anchor companies for our emerging industry. Some other larger companies have gone a bit sideways or slowed growth recently (Glenayre, Prologic, Epic Data, Sierra Systems, Motorola Wireless Data) but may turn around soon. Some went very awry (Radical, Digital Courier). Other players are likely to step up into the limelight in 1999. The ones to watch are Sierra Wireless, Pivotal Software, Angiotech, AnorMed and Burnt Sand Solutions.
My forecast has a down note, though. Unfortunately, I don't think our stumblebums in Victoria will land the lucrative deal to have the Taiwanese Mosel Vitelic $2B semiconductor fab built here. They are up against a formidable foe, Quebec. The Quebecers have made subsidization an art form. There overtures for a big project like this would make IOC members blush. Interesting note: 6 years ago, Micron announced that they would build a similar sized plant for DRAM in one of Alberta, BC, Washington or Oregon. I remember being flabbergasted that the Harcourt government of the time didn't even return Micron's calls. Ignored them completely. Not interested in jump starting an industry. Wouldn't think of making concessions or subsidies for a big American firm. Nope. Times have changed, haven't they? At least this NDP is making a run at the new plant.
Education - In 1999, we will continue to see a lack of trained technology people emerging from our schools. But the tide is turning. Tech BC is now open. UBC is beginning to understand that the new economy affects academia too. While they have been brilliant at churning out world class research, the universities need to churn out world class engineers and business leaders that are versed in the absolute latest trends. SFU and BCIT are continuing to out-innovate UBC in programs designed to give kids the right skills. Why is it that Waterloo is churning out the next 100 Microsoft software engineers this year? See sections below on Attitude and Connectivity...
Finance - We need more cash. We need more sources of cash. We need the people dispensing the cash to be a little more creative and less conservative. We need the entire financing industry to get into the new economy, too. Evidence? You need evidence? Multiactive Technologies, with an estimated $15-$20 million in revenues and an e-commerce tool that just won a Codie Award (very prestigious) is forced to roll up Wheat Hills Resources into a new public entity. No IPO. No huge valuation.
Here's my favourite, though: Dejour Minerals, trading on the TSE for thirty-one years, constantly in search of a mining strike and constantly under $0.10 is now a backer of an e-commerce technology. Instantdocuments.com is based in Dallas, but involves some Vancouver people. Has it come to this? Find a mining company with some cash and get them to give you venture capital so they can inflate their stock. 1999 Prediction: Geologists become e-commerce experts. Howe Street promoters strike new gold. Bre-X's shell is resurrected as a bingo web site.
BC's Technology People:
Attitude - In my sample of the hard-working people that make up this large and growing community, I see the right attitude. I see people buying into the dream. I see all sorts of characters taking big risks to hit the big home run. The reason I love my job so much is that I love hearing the pitch from the company and feeling their excitement. Conviction and passion are two critical parts of the attitude that makes for a great technology entrepreneur. I see a big difference in the West coast versus Toronto. Toronto typifies the reason that Canada has fallen behind the U.S. Most people there are absolutely petrified of failure. Because of that overriding fear, they don't trust people on first meetings, they don't take big risks and any dreams of wild success are tempered by hollow feelings of "What will my friends think?".
If the right technology attitude was a 10 (the Silicon Valley) then Toronto would be 2 and BC would be 6. I believe that BC is far and away the best place to be in technology because we are closest to the Valley. We can feel the energy. We all know someone that has made it down there and we know that they aren't any smarter than we are. 1999 Prediction: We move some of the attitude laggards (government, financial community) more to the right frame of mind.
Innovation - I have to give top marks to our researchers and engineers in BC. They are keeping us on the cutting edge of innovation and providing fertile ground for new products and companies. The right mix of world class university researchers, government labs and corporate R&D facilities are present as well as the tax credits that force every company to think about innovation. I have seen our applications of technology kick serious worldwide butt in the fields of biotechnology, wireless communications, fuel cells, optical hardware, data networking and many other narrower sectors.
In 1999 I think that we can keep up this pace. Bigger companies spend even more on R&D, so the trends look good. We could use some help in BC in the innovation are for business and marketing strategy. Sure, you can copy existing business models and be successful. I'm not seeing a whole lot of new business ideas. Where are the clever marketers? Where are the prescient and resourceful entrepreneurs that make the rest of us slap our foreheads with their ideas? We need you.
Connectivity - If you have an idea in Inuvik, chances are it won't even get past your grey matter. If you have an idea in Palo Alto, chances are you have it refined, on paper, know 3 people that will do it with you and have a term sheet from a VC before you can even prototype it. A thriving community of driven, educated people allows someone with an idea to start bouncing it off others smarter or more experienced than them. The idea gets refined and gets better faster when there are more people around. Similarly, once you have a company and you want to sell, you need partners to get big fast. In a large local community it's easier to get a name, bump into someone at the grocery store or stand on a street corner and scream and get a new partner.
BC is still somewhat balkanized in its technology community. Sure, the managers get together at the VEF, TIA and other connectors, but there needs to be more un-structured sharing of ideas in BC. Employees need to get out and meet more smart people. Interest groups need to stop pretending that their organization is better than the other one from the same industry. The individual companies need to get out and get partners. They need an "in" with the big boys in the US if they want to get a big ramp in sales. My prediction for 1999 is that BC's tech community starts to really see the benefits of more connectivity, within BC and with the US.
When you add it all up, I predict that BC's tech sector will suffer the slings and arrows of our inept government in 1999 to some degree. The trickle down effect is loss of skilled people and the resulting lost connectivity, innovation and attitude. But I do believe that it will only be a trickle. We have a strong fundamental technology base in BC and an incredible worldwide momentum towards our industry. With a few more shining lights, 2000 looks very promising. But I'm getting ahead of myself.
What Do You Think? Talk Back To Brent Holliday