Canadian companies are at a disadvantage because the federal government isn’t as willing as other countries around the world to buy from domestic technology developers, said local tech icon Terry Matthews.
Bridgewater chair Terry Matthews. (File photo)
Mr. Matthews, the founder of Ottawa firm Mitel and several other local companies, made the remarks during a panel held this week at the Marshes golf club in Kanata.
He echoed concerns from others in the country’s tech industry that Canada is at a disadvantage because the feds don’t place the same emphasis on buying from domestic companies.
This not only reduces the amount of revenue companies are bringing in from government contracts, he said, but also makes it more difficult to sell to other private sector businesses.
“If you can’t sell in your own country to your own government, when you try and sell somewhere else, your competitors will say, ‘They can’t even sell to their own government.’ You are dead meat,” said Mr. Matthews.
This places them at a disadvantage to other companies that benefit from their governments setting aside a greater amount of the business for domestic firms.
Mr. Matthews acknowledged some of the criticism that comes with the approach other governments take: because they are setting aside sales for a limited pool of bidders, they aren’t necessarily getting the right price.
However, he said it’s not acceptable that Canadian companies are guaranteed to “die on the vine” unless they are able to sell extensively in the United States.
“I say that’s not good enough,” he said.
Mr. Matthews’ comments echo the concerns voiced in a report conducted for the Canadian government earlier this year.
Tom Jenkins, an executive with business solutions firm OpenText, recommended the federal government spend more money on defence equipment developed by domestic companies. The governing Conservatives are currently reviewing the report’s findings.
Mr. Matthews also expressed concern about the ongoing situation with Canadian smartphone maker BlackBerry.
The company recently announced it was laying off 40 per cent of its workforce as it evaluates its strategic options. It is currently considering a purchase offer.
This is “a blemish” for Canada’s reputation as it struggles to shed the issues created by the demise of Ottawa-based firm Nortel a few years ago, said Mr. Matthews.
“You go around the planet and people say, ‘Can you do high-tech in Canada? There’s no high-tech companies in Canada that are any good, right?’ ” he said.