High-tech sector still a bright light

Saturday, June 28, 2008

Greater Victoria's dream of a high-tech future as Silicon Valley North was struck another blow this week with the announcement that Carmanah Technologies Corp. is moving its manufacturing offices all the way to Singapore.

It's not the end of the dream, though. There are still 878 technology companies here, contributing $1.7 billion a year to the economy -- and almost any one could become a major player.

Carmanah has been one of the bright lights in the local technology sector, and not just because it makes solar-powered lighting products. It has a reputation for innovative, environmentally friendly products.

Once the restructuring is completed -- with the loss of 72 jobs here -- Carmanah will have been transformed into a product development and sales operation rather than a manufacturing one. The assembly work formerly done in Saanich will be done elsewhere.

Carmanah is hardly the first company to move manufacturing out of Canada or the U.S., and it won't be the last. The shift to lower-cost areas makes sense for shareholders, even though it hurts employees here.

It's also not the largest cut to the local technology sector. Consider Stressgen Biotechnologies Corp., which eliminated more than 120 jobs and moved to San Diego last year. Or SDL Optics Inc., part of fibre-optics giant JDS Uniphase, which cut 240 jobs at its Central Saanich plant in 2001.

SDL was a local success story that was sold to a much larger company -- just like Aspreva Pharmaceuticals, acquired by a Swiss corporation last year, and Municipal Solutions, which went to a Toronto company a month ago.

We could see those deals as signs of weakness or at least a loss of local control in rising industries. On the other hand, we could consider them to be successes, local creations that attracted attention on the world stage.

The latter view makes more sense. Greater Victoria has a vibrant high-tech industry, with enough knowledge to create employment here while generating innovation and ideas.

But it will never match that of Silicon Valley -- or even compare to hundreds of other places that are trying to prove they are Silicon Valley North, South, East or West. We are too small to compete with the largest technology centres and too far from them to become a major player. We are also on an island, making access more difficult.

That said, we can still make a difference. The Vancouver Island Technology Park remains a hotbed of activity. We still have one of the true success stories of the Internet age -- abebooks.com, the world's largest bookselling service.

Our location helps attract some of the finest minds in Canada. The new United Airlines direct flight to San Francisco will make it easier for local companies to deal with the giants in the real Silicon Valley.

We are ideally placed to be a high-tech incubator -- a place where ideas can flourish and products and services created. The businesses that spring out of those ideas might make the world stage -- and that might mean that it's best for them to leave. We would not expect David Foster or Nelly Furtado to make the big time while staying in Victoria; instead, most of us are pleased when a local entertainer becomes a star. The same thinking should apply to our high-tech companies.

Yes, Carmanah's restructuring means job losses locally, but its lighting innovations are here to stay. That's a credit to Greater Victoria's status in the competitive world of high technology.