1. i COMMUNICATION AND CULTURE
Science, Technology, and Society Program
Science B 419
Telephone: (403) 220 3228
Fax: (403) 289 9488
Email: chlangfo@ucalgary.ca
2500 University Drive N.W., Calgary, Alberta, Canada T2N 1N4 ? www.ucalgary.ca
The Calgary Wireless Cluster
A preliminary note on the results of a qualitative study carried out under the
Innovation Systems Research Network project on the role of regional
clusters in innovation and economic growth
The results reported here are the outcome of three months of interviewing among representatives of firms,
research institutions, and government and public infrastructure organizations that are connected to the wireless
industry in Calgary. At this stage the work has focused on the "upstream" activity and has not yet addressed
the groups involved in delivery to final users.
The team responsible includes Cooper H. Langford as project director with Terry Ross and Jaime Wood as
research associates.
DRAFT
16-Dec-01

2. 2
Introduction
This report presents the results of a qualitative study of the core of the wireless industry in Calgary.
The study seeks to relate currently influential notions of the advantages of regional clustering to the
experience surrounding the growth of the wireless pole in Calgary. The focus is on factors that
relate to innovation and the pathways of knowledge flow. As we believe the results will show, the
wireless cluster depends strongly on two factors, a global fund of explicit knowledge and a highly
mobile core of “carriers” of tacit knowledge. The explicitly regional issues connect strongly to the
tacit component of knowledge. This required the qualitative methodology of the present study
because tacit knowledge is inherently almost “undocumentable”.
This report does not pretend to a comprehensive treatment of Calgary wireless activity. Readers
familiar with Calgary will recognize that the activity in geographical positioning systems (GPS) is
seriously under-represented and we have not tried to pursue interviewing to the major “final
demand” suppliers active in the region. We have considered mainly three groups. The first is
upstream players including design firms, contract manufacturers, and software providers. Next
come wireless equipment manufacturers and system integrators who assemble components from a
variety of sources into a “solution”. Finally, with our knowledge focus, we have explored the
relations with regional infrastructure including research institutions, government programs, civic
organizations, and services such as venture capital, IP law, and knowledgeable accounting,
Two comments are probably appropriate at the outset. First, we believe that the evidence
underlines the path dependence of the development of the industry in Calgary. It would be very
difficult to write a recipe for reproduction of the Calgary experience. We suspect that this is not
unique to our case and emphasize the particularity of the experience of regional clusters. Second, it
is essential to see an industry like wireless in its global setting. In the short time since the first
serious recent writing about the effectiveness of regional clusters as drivers of economic
development, industries with communication at the core have evolved the nature of the relationship
to place in ways that may well require revisions of cluster theory.
Some characteristics of the industry
The underlying science for wireless technology is no less than global. Calgary’s system integrator
companies report that they do not look to carrying out long-range research in the face of the short
product life cycles of the industry. Rather they report active engagement in technical intelligence
gathering exploiting mechanisms such as the Internet. An interesting cross current influences the
availability of information. It is important in the industry to establish a reputation of technical
leadership. This induces announcement of achievements that serve to make key information widely
available to potential competitors in a way unknown to traditional industries.
There is not a lack of connection of the industry to long range scientific research institutions. In
Canada, there are a number of supra-regional organizations that provide a forum for the industry to
identify needs and opportunities to engineers and scientists in research institutions. Two examples
connect to Calgary. The most immediate is the Calgary based wireless centre of TR Labs. TR Labs
is a university, industry, government consortium that conducts pre-competitive research for the
telecommunications industry and supports graduate training in the universities in five centres in
Western Canada. In the immediate context of the Calgary wireless industry, TR Labs makes its

3. 3
major contribution via the high level of recruitment of graduate students who work on TR Labs
projects to employment within the cluster. However, the priorities for the research program are
established by a board with supra-regional scope. In fact, a problem for TR Labs is identification of
the outcomes of its research in product terms because the results tend to “disappear” into the
overall programs of the sponsoring companies with exploitation across Canada. Another important
organization is the granting council sponsored Network of Centres of Excellence called Micronet.
Micronet sets a research program by consultation between university and industry scientists at a
board national level. The projects are then undertaken across the country wherever the most
effective research group can be found without regard to the location of the industrial “user” of
outcomes. Thus, the science is conducted on at least a national scale. No doubt it is international
and there is an “organization” that depends on the “invisible colleges” of the research disciplines.
Here Merton’s (1968) “Matthew effect” probably operates and leading schools play a leading role.
The consistent report from interviews across the cluster is that the critical factor in growth of the
wireless industry is talent. The consistent argument in favour of Calgary as a location for a wireless
firm is that there is a concentration of wireless expertise in the Calgary region. Talent is the limiting
factor. The only differentiation among the opinions expressed in interviews was the scope of talent
required. Several interviewees expressed a concern for a very specific talent profile. This was a
requirement for employees with ten years of experience in wireless who brought more than
technical talent. They are required to have a combination of technical insight with a deep
understanding of the factors that convert a technical solution into a market success. These people
are a very small fraction of the industry population. They are also the most mobile. Like leading
pure scientists, these business/technology leaders tend to arise from “schools”. The best younger
talent is drawn to work with the best known and most respected older leaders. This presents a
challenge to a centre like Calgary that may be important in Canada but is not at the scale of an
American centre such as Dallas.
In wireless, the problem of standards is shared with other sectors that support communication.
Communication must have common means at both ends of the channel.
An important strategic concern for firms is to gain a place is standard setting consultations and
regulation plays a critical if somewhat chaotic role. From a theoretical perspective increasing return
to scale (Arthur, 1989) is a pervasive phenomenon. Lock-in is expected, as is its opposite face,
lock-out. The interesting question that this industry raises is a result of short product life cycles.
How readily is lock-in broken? What factors influence such changes? Leydesdorff (1999) has
offered simulations of such phenomena.
Origins of the Calgary cluster
Calgary, traditionally recognized as a strong player in the oil and gas industry, has gained
increasing international attention for its activities in the wireless industry over the last two decades.
There is a good case for considering the oil and gas industry as a driving cluster to wireless.
Calgary has now come to be known as a wireless “center” worldwide and is home to over one
hundred wireless and wireless related companies. The development of Calgary’s wireless industry
can be traced to a few key events. These include the founding and ultimate government divestiture
of NovAtel Communications Ltd. (NovAtel), the role of Nortel in the Alberta economy, and the
subsequent emergence of a self organizing system that has become a wireless cluster. It is
essential to recognize the particularity and the path dependent nature of the cluster development.
The emergence of a wireless pole at Calgary does not appear to be dictated by a series of factors
that could be intentionally reproduced to generate a similar level of activity in another region. The
one clear environmental factor that we will emphasize is the "quality of life" factor that is, itself, a
complex of a number of dynamically determined elements interacting in a "geological" setting.

4. 4
Consequently, the thinking about the future of the Calgary wireless cluster must be approached
dynamically. In this report we follow events up to the recent sharp decline. Later in our study when
there has been more time to see the unfolding we intend to return to the effects of the decline.
The roots of Calgary’s wireless cluster can be traced back to 1983 and the formation of NovAtel
through the joint venture of Alberta Government Telephones (AGT) and NOVA Corporation of
Alberta (NOVA). AGT had become involved with the oil and gas industry providing Radio Frequency
(RF) used by workers in the fields. RF was employed very early on providing Advanced Mobile
Phone Service (AMPS) as early as 1977, which used the Aura 400 network, the first wide area
wireless network. This network enabled workers in the field to get information back to offices in
Calgary and Edmonton rapidly. The overlap between the oil and gas and wireless industries led to
the joint venture between AGT and NOVA Corporation. This is a classic example of the role of a
driving cluster, the established oil and gas industry. The goal of the joint venture was to design and
manufacture cellular and mobile phones and by 1985 NovAtel proved to be a success. NovAtel was
a major player in the North American market and was estimated to be the fourth largest supplier of
cellular phones in North America. By 1990 over 50% of NovAtel’s sales were in the United States. It
is significant that NovAtel also had valuable technology for the new Global Positioning Systems
(GPS) and the descendents of NovAtel also participate actively in making GPS an important
element of the Calgary wireless industry.
Despite technical and market successes, NovAtel suffered strategic and managerial problems. In
1989 AGT bought NOVA’s shares in NovAtel, and in 1990 the Alberta Government acquired
NovAtel from AGT. In the face of continuing problems, NovAtel was split up, the provincial
government retained the Systems Financing, Northern Telecom bought certain assets of the
Cellular Systems division and committed a large sum to a Calgary-based Center of Excellence in
wireless. Telexel Holding Ltd. bought a substantial portion of the handset business as well as the
NovAtel shares representing the subscriber equipment business. Telexel's take over included a
restructuring plan focusing on three main product lines: 1. digital and analog cell phones, 2. GPS, 3.
Supplementary Communications system. In addition, Nortel’s (formerly Northern Telecom) wireless
division acquired NovAtel’s switching technology in an agreement with the Alberta Government to
move a wireless Research and Development department to Calgary and maintain a presence in
Alberta until 1995.
The 225 employees that were transferred from NovAtel to Nortel aside, the break up of NovAtel left
a large talent pool with expertise in the areas of design and manufacture for the wireless industry.
The talent pool was a major asset for Calgary in retaining Nortel’s Research and Development
department. For the rest of Calgary’s talent who did not secure jobs with Nortel, many have proved
successful in the wireless industry by forming their own companies or joining the new entrants.
Murandi Communications Ltd., lsotel, Novatel Wireless and Norstar were just a few of the direct
spin offs as a result of the NovAtel divestiture (See Figure 1 for a fuller preliminary genealogy).
The rich pool of resources in Calgary worked to sustain and grow the economy on multiple levels.
The considerable pool of talent along with the celebrated quality of life and low costs of doing
business worked in attracting other large companies to Calgary including, over time, names such as
Harris, Intel, Panasonic, and V-tech. It is especially important to realize that players such as Nortel
who brought complete business units to Calgary enriched the talent pool in the very important
dimension of importing and training broad gage technology managers who understand how to
translate technical development into successful business systems.
The emerging focus has stimulated the local university and colleges to work with the government
and industry in developing programs and infrastructure to support growth and expertise in the

5. 5
wireless industry. TR Labs (the western telecommunications research institute) has located its
wireless laboratory in Calgary. TR Labs is a strong representative of Industry, University,
Government interaction. Its "graduates" (it collaborates with the university in training of graduates
students) along with a large proportion of university degree holders in general stay to participate in
the local industry. However, local "pure" research projects have not, with a few notable exceptions,
that often been directly translated into local industrial applications. The underlying science of this
industry is global and coordination of university and industry has occurred more at the national than
local level. The experience of TR Labs is mirrored in this respect by the network of Centres of
Excellence known as Micronet. The notable exception, institutionally, is the very strong university
Geomatics Engineering department that influences local firms in GPS just as it influences the GPS
field internationally.
A central support to the growth and maintenance of the Calgary wireless cluster is the regional
talent pool. Where this talent comes from and subsequently goes is directly related to how the
cluster grows and diversifies or the “path” of events that occurs within the cluster. In the Calgary
case, the initial large talent pool for wireless was recruited for NovAtel in the early 1980’s. After the
divestiture in 1991, large companies new to the region took on many of these individuals. As a
result large corporations in world-class facilities trained the majority of the talent pool in Calgary.
(The desired new employee of most firms is an engineer with ten years of experience who
understands the intersection of technology with business opportunity.) By the mid 1990’s, this
“talent pool” had expanded from a few central sources of talent to a diversified economic cluster.
From Figure 1 it is noted how highly path dependent the nature of the cluster is, such that within the
small regional community the path of development occurs as a direct result of how the talent pool
moves. For example, many of the third and fourth generation companies within the cluster have
knowledge or personnel that can be traced back to NovAtel both before and after its divestiture. In
addition, many of those companies have strategic relationships with other companies with similar
ties to NovAtel and/or its divestiture. As such it can be said that the main path of evolution of the
Calgary wireless cluster was shaped by the formation and divestiture of NovAtel and the
subsequent transfer of personnel among the industry in a small region. Similarly, the pattern of
growth in the region to other areas also occurs through personnel and knowledge transfer. For
example, the inception of the Calgary wireless cluster was initially a result of the convergence
between the oil and gas and wireless industries that was locationally specific to Calgary and
Edmonton. However by the mid 1990’s companies had started to diversify the wireless industry in
Calgary and the regional boundaries of the city were extended to those of North America, Asia,
Europe, and the rest of the world through the innovations of the new companies.
Key relationships in the cluster
In the next few sections, we consider several of the key relationships that have been emphasized in
cluster analysis. These include supplier-customer relations seen both as core cluster companies
relating to users and those core companies as customers of design, software, and contract
manufacturing firms. A second area is competition and knowledge flows between competitors. The
third area is the relation of firms with regional infrastructure.
Cluster company - customer interaction
The importance of and extent to which customers’ affect and influence new products or
technologies of the wireless ‘cluster companies’ studied thus far must be considered in terms of the
specific relationships customers have with particular firms. Specifically if that customer is a
traditional demanding customer, as examined in Porterian (Porter, 19xx) models, where demanding

6. 6
customers insist on perpetual innovation by a firm in order to sustain the needs of that customer. Or
rather, does the customer work as a partner to the firm in some capacity and can be seen as an
‘early adopter’ of new technologies thus expanding the traditional Porterian role of the customer.
Both the demanding and early adopting customers perform the same function of encouraging a firm
to innovate however the difference is in method and style of relationship.
The importance of the demanding customer is that it fosters innovation and product improvements
by challenging the firm and enforcing high standards. The demanding customer understands a
market sector and can work to improve upon or set new standards to be met. Porter’s thesis is that
local demanding customers communicate more forcefully. Many of the firms included in this study
tend to service both local and non-local customers. Influences and standards from other locations
outside of the region must be understood in order to appreciate influences on innovation.
However, when a customer works with a company in developing a product or idea, the customer
may function as both partner and customer to that firm. These customers are called early-adopters
and are typically non-demanding customers. Their influence as a partner often determines the
success of an idea or product and adoption of the new product. Such a relationship is often critical
to standardization for new start up companies, for example. Often the local ‘early adopters’ of
technology can be used as a test bed for young companies to improve and update their
technologies in addition to creating new sources of the financing and knowledge that can be difficult
to retain as a small company grows. More importantly however are the established ‘friendly’
relationships companies tend to share with early adopters. These ‘friendly’ relations offer a full
communication link between a firm and the customer through the transfer of tacit, informal and
unstructured knowledge. ‘Friendly’ relations between the firms studied thus far tend to characterize
the nature of this cluster. An interviewee characterized a common relationship in this cluster with
the comment: “I have demanding customers. I wouldn’t put a product into their hands until it was
completely right. I need friendly customers.”
The ‘friendly customer’ relationship that characterizes downstream links for many of our
interviewees is also prominent in the upstream relationships to design, software, and contract
manufacturing firms. One interviewee stated that such amicable relationships within the local region
are extremely important as they lead to “directed innovation” where “word of mouth networking”
allows for communication to occur at an informal level which may subsequently lead to formalized
results with respect to a particular design or product. In this way the early adopting consumer has
the opportunity to influence product design at the upstream level, which can prove advantageous
for other customers as well as the upstream firm itself over a period of time.
Some of the larger actors have outsourced major parts of their manufacturing to contract
manufacturers. This has led to growth of contract manufacturing in Calgary. Major companies have
located here and are growing their Calgary based businesses. This has significantly enriched the
environment. In growing business from the Calgary base, the contract manufacturers enrich the
environment beyond the role they play for the clients who attracted them to Calgary.
In general, there has been little evidence for formal, interfirm knowledge exchange programs (the
exception being the very specific links between contract manufacture and design firms and the
systems integrators) such as collaborative personnel exchange between firms within this cluster.
One may speculate that given the diversity of the wireless cluster, this is potentially due to the lack
of common goals, or bounded rationality.

7. 7
Competition in the cluster
One of the central notions of cluster theory is that a set of competitors can accomplish more than a
major integrated firm. Two ideas of how this arises contrast. One view is that domestic rivalry, like
any rivalry, creates pressures on companies to act dynamically and to innovate. Domestic rivalries
are likely to be especially vigorous as rivals compete not only for markets, but also staff, technical
prowess, and “bragging rights” (Porter, 1990). A complementary, but contrasting, view sees the
importance of proximity in the flow of information, intentional and accidental. Competitors provide a
range of models for solution of the industry’s problems and firms can learn from the diversity in a
way that could not happen in a single integrated firm (Malmberg and Maskell, 2000). The structure
of competition in global wireless is more complex than these considerations foresee. Consequently,
the role of local competitors is not central. Certainly the larger players are very clear as to the
nature of their competition, but few of these are local so that local competition is not a major factor.
The younger firms in Calgary have difficulty identifying who their competitors are. One interviewee
noted that there is a strong overlap between the classes of strategic partners and potential
competitors. The relationships are fluid. Another interviewee indicated that, “it is very difficult to say
who our competitors are. Our competitors can also be our clients.” The interviewee pointed out that
the reason for the overlap is the “new space’ in which the wireless world is operating, referring to
the enormous potential for expansion in the wireless sector both within the region and abroad.
Relationships to infrastructure
We have treated the relationships to underlying science and the research institutions in the
introduction. The science is global. Our interviews drew little indication of active links to the
research institutions such as university electrical and computer engineering, computer science, and
TRlabs, whereas these groups have important links to industry in a larger geographic frame. At the
first level, it would appear that the Calgary research institutions contribute to a science pool at the
national and international level and that the firms draw on this pool similarly broadly. The processes
of translation between the language and value system of universities and the formulations required
by the industry are most often accomplished between academic leaders and representatives of the
larger firms. However, there are some important exceptions to this account. The origins of two
interesting innovative Calgary firms, Wi-Lan and Cell-loc, have direct connections to research in the
universities and the university geomatics engineers have influenced both local and international
practice of GPS directly. At a second level, we raised a question in some firm interviews, “if you
needed information from the university how would you get it?” This question revealed that there was
a good deal of knowledge of the university who’s who and probably more informal communication
than is explicitly recognized. Chrisman (199x), using the University of Calgary as a case, has shown
that informal communication plays a larger role in university economic impact than is usually
recognized. The one point that is clear from the interviews with both institutions and firms is that
the institutions are now making a very significant contribution to the talent pool. The graduates of all
programs have a propensity to locate within the cluster. This assures the best long-term transfer of
both tacit and explicit knowledge – by the foot soldiers.
In the early stages of the development of the Calgary cluster, the community was not rich in
technically sophisticated professional services. As well, suppliers of standard components
(generally not manufactured here) were not well represented by informed marketing. The growth of
the cluster has changed this situation profoundly. Component suppliers are now well represented.
Several major law firms have developed sophisticated IP practices that are knowledgeable about
telecommunications, electronics, information technology, and wireless. Similarly, interviewees

8. 8
report that technically sophisticated accounting services are available and that local professionals
are utilized in the cluster. One interviewee commented that, “five years ago I couldn’t find an IP
lawyer to save my life! Now they are all over the place.”
Networking organizations.
A significant aspect of any dynamic cluster system is the networking practices of the players within
the cluster. Networking is an activity that requires a certain level of trust and an ability to set
common goals. Calgary networks might have the goal to disseminate knowledge of best practices,
encourage partnerships across industrial groups, and set up relationships with research institutions
as needed. Participants in the Calgary wireless cluster have the ability to engage in business
networking on a regular basis through a number of organizations These include the Calgary Council
for Advanced Technology (CCAT), Partners in Technology, the Licensing Executives Society, The
InfoPort project of Calgary Technologies, Inc. and many others. In our interviews, however, it was
not usually the case that we found individuals who attended such meetings on a regular basis. One
problem may be that the organizations are relatively general and not focused specifically on
interests of the wireless cluster. Responses from interviewees on several occasions were that
senior management and technical staff do not go to networking events because they feel they are
intended for the business services sector. This perception may be an accidental consequence of
the fact that representatives of the business services infrastructure commonly are principal movers
in organization of groups. As such there may be an opportunity to introduce a forum dedicated to
information dissemination to increase competitiveness in the international marketplace and to share
technical knowledge explicitly for the wireless community.
Government and semi-public support organizations.
Government and semi-public organizations, whose purpose is to facilitate regional development in
high technology include Calgary Technologies Inc. (CTI) at the municipal level, The Alberta
research Council (ARC) and iCORE at the provincial level, and the National Research Council’s
Industrial Research Assistance Program (IRAP) as well as Industry Canada and Western Economic
Development officers at the federal level. CTI operates an incubator with xx firms in the cluster
resident as well as the InfoPort program. ARC has IT but not explicit wireless activity in Calgary.
ICORE is devoted mainly to bringing leading researchers to the universities in Alberta and
strengthening the infrastructure of research. The one contribution widely appreciated by the firms
interviewed is the IRAP program from the National Research Council. It was widely viewed as a
highly effective organization for facilitating the growth of companies. We believe this is a reflection
of its atheoretical approach. NRC Industrial technology Advisors work with firms to identify
opportunities and needs and respond knowledgably to aid in delivering both knowledge and
financial support. They don’t pick winners, they find winners.
Strengths of the Calgary wireless cluster
The interviewees were quite consistent in their identification of the strengths of the Calgary cluster.
Foremost was the presence of a considerable pool of wireless talent in Calgary. As was seen in
Figure 1 there has been considerable linkage among firms resulting from the movements of
individuals linked back to NovAtel. It seems likely that the uniformly positive feelings expressed
about the talent pool is at least in part a consequence of the impression that wireless is a rapidly
expanding field. Firms follow differentiated paths and there is little sense of local direct competition.
Another important intangible asset that is relevant to innovation is the networks of relationships that
individuals bring to and from establishments. The inherent values of these informal contacts are

9. 9
difficult to measure yet they play a significant, albeit hidden, role in the innovation process. The
skills and networking capabilities of personnel are crucial in developing new technology and in the
successful development of innovation-based establishments. Among our research we noted many
cases of highly mobile individuals within the cluster in addition to an overall feeling that if a
particular establishment were to cease operations it would not be terribly difficult for an individual to
move to another project. Many of these seasoned personnel with whom we spoke had been
employed at various wireless firms in Calgary and thus tacit knowledge bundles that they take with
them over time can be traced as seen in Figure 1. As one might expect many of them had at one
time or another passed through NovAtel or Nortel, which isn’t surprising considering the relative
size of these organizations.
The second factor identified universally was quality of life. This has two components. The first is the
physical environment and the opportunities for an outdoor lifestyle. The second is the sense that the
community is clean, safe, friendly and has well supported public services. This second factor may
not be as secure for the future since the city displays signs of growth stress as it moves to pass the
one million population mark. Public investment has been weak recently. A related advantage often
identified was the cost of living and the tax regime.
There is only a small local market for wireless products. International non-local markets is a
characteristic of practically every ICT cluster. However, the large oil & gas industry in Calgary has,
in many cases, proved to be a catalyst for wireless product innovation due to the data transmission
needs in remote rugged terrain. So while the domestic market is small in comparison to larger US
based centres, local customers have proven, historically, to be an invaluable source for innovation.
As the cluster has matured, this factor will probably figure less prominently.
Calgary is also identified as a cost-effective location for a business. Several of the interviewees
remarked on the comparisons among Vancouver, Calgary, and Toronto as regions in which
wireless firms might locate. Toronto is seen as expensive and least attractive. Vancouver is seen a
highly attractive but too expensive. Calgary is seen as the happy compromise of an attractive
location with reasonable costs. Finally, Calgary7 is perceived as exhibiting a high degree of “can-
do” entrepreneurial spirit, we consider this an intangible asset in the realm of social capital
The infrastructure for the Calgary wireless cluster has matured. Sophisticated professional services
from accountants. lawyers, and management consultants are available. Suppliers of components
are efficiently represented. The local educational and training institutions have responded to the
growth of wireless and graduates are locally employed. (The Faculty of Engineering at the
University of Calgary has expanded more rapidly in recent years than any other engineering faculty
of a major university in the country.)
Weaknesses of the Calgary wireless cluster
The most generally identified concern was lack of local venture capital for wireless. Calgary has a
well deserved reputation as an oil-based economy. Many of the informal investors in Calgary have
considerable experience in oilpatch investing procedures. Unfortunately, this means that many
potential technology investors are averse to investing in start-up companies. This is mostly a
consequence of the attractive alternatives for investment in the oilpatch which do not require them
to learn a new industry. There is currently a lack of productive cross industry communication in
Calgary. The positive aspect of the current situation is that “third generation” companies are now
appearing in the cluster. If earlier generation entrepreneurial ventures can be sufficiently successful,
they should generate a pool of technology investors.

10. 10
The compilation by Calgary Technologies Inc. (Reichert 2001) of more than 100 firms involved in
wireless in Calgary includes a majority that were not here in 1995. Young firms are an important
part of the industry. In the report “Barriers to Technology Commercialization in Alberta” Healy et al
(19xx) outline that it was common in the pre-commercial SME’s for CEO’s to acknowledge the need
for more experienced assistance and the need to upgrade their own skills. However, these CEO’s
often attributed their inability to access the necessary human capital to a lack of financial capital.
Ironically, investors frequently indicated that a stronger human capital position (i.e. stronger
management teams) would mitigate many of their financing concerns. Another managerial problem
is a general lack of individuals with experience in all relevant areas of early-stage technology
commercialization. There is a human resource shortage of qualified managers with industry-
relevant experience that are able to foster the growth of small-high technology companies and a
shortage of ‘serial-entrepreneurs’ or entrepreneurs who are experienced in the nuances and needs
of start-up companies. As noted above, some have argued that the key shortage is of ‘star-
performers’, that is, engineers who are extremely creative and productive and create and lead the
projects that lead the industry. The stars sought are technically highly creative in a context of overall
innovation, not simply invention.
The largest firms express a theory of location that suggests placing marketing near customers,
manufacturing where it is most cost effective, and development where the talent is found.
Development in this direction has been a feature of the evolution of the Nortel presence in Calgary.
Earlier Nortel activity involved complete business units. This served as a training ground for broad
scope technology management in Calgary. As Nortel has focused its major presence more on
developmental activity, there is concern that one major source of the most sought talent mix has
been lost.
The Calgary wireless cluster is an emergent young configuration. Market conditions at the time of
this writing are poor, especially for technology firms. Most technology companies have had trouble
meeting sales and profit goals and were being punished by the marketplace. This has affected the
cluster through decreased orders from customers. As well, financial institutions, especially venture
capitalists, are feeling risk averse. There has been anecdotal evidence to suggest that the number
of new companies being financed by VC’s is down significantly. Financial institutions are focusing
their energy on their existing projects. This affects the cluster significantly because early growth
companies have a more difficult time finding appropriate growth financing. We are just completing
the first phase of a three-year study. It will be of great interest to follow the effects of the problems
of the year 2001. It should help to define much more clearly the fundamentals of this cluster.
Clusters are, as the Calgary wireless example underlines, the product of an evolutionary self-
organizing dynamic. A “snapshot” at one moment in this process is never satisfactory.

11. Pre 1978 Computing Devices Canada*
1978
Deltatee
Enterprises
1979
1980 Sanmina
1981
1982 AGT (Westech) + NOVA Corp
1983 NovAtel Communications
1984 TR Labs
1985
1986
1987
1988
1989
1990
Norstar
(Norcien
GPS
manuf.)*
CSI
Wireless*
1991 NovAtel Divestiture
1992
Harris
Wireless* Nortel
Telexel Holdings/
(Horst Pudwill)
NovAtel Comms.* Wi-LAN Murandi
1993 R&D Centre Japan Radio Corp*
1994 Isotel* University of Alberta
1995 DSPG Comms* Cell-Loc*
NovAtel
Inc.*
1996
Intel R&D
Lab*
NovAtel Wireless
(R&D)*
1997 University of Calgary
1998 Dynastream EMG manuf.*
Terradox
Corp
1999 WaveRider Si Works Solectron*
2000 PsiNaptic
2001 W Mode
Year/
Function Hardware Software Service GPS Uni/Gov Institutions
*company not yet interviewed
indicates geneology relationship
at least one senior person from either company sits on Board of Directors
indicates strategic relationship
transfer of knowledge or key people
indicates direct spin off
Figure 1.0 Genealogical relationships for selected companies of the Calgary wireless cluster