Blackberry to add 800 jobs in Ottawa, build self driving cars

Blackberry teamed up with federal government and will be investing $350m to build self-driving cars in Ottawa.

Federal government will pitch in $40m while Blackberry itself will be investing $310m.

The jobs will be added over the next 10 years.

In January, Ontario government has announced greater leway for self driving cars to operate in Ontario. Where as before you had to have someone sit in a car as backup, now you are able to have the car drive by itself as long as you have some remotely monitoring it.

Blackberry’s division, QNX, was one of the first companies in Canada that had autonomous vehicle drive on its own in Canada in 2017.

Quebec’s Fight Taxing Out of Province Digital Sales

Quebec’s government has decided to start collecting taxes on digital sales, such as Netflix subscription, this year even though company that sells the services or goods does not have physical presence in Canada or Quebec.

Update: Saskatchewan has also recently followed Quebec by collecting taxes on “transmission, broadcast or distribution of data, programming or entertainment” on companies selling into Saskatchewan with no physical presence there.

This new tax has been called “Netflix tax” due to large number of users in Quebec that watch Netflix and now will need to pay this tax in Quebec.

Canadian Prime Minister Justin Trudeau opposed Quebec’s tax enforcement of out of country digital sales saying that Canadians already “pay enough for the internet”.

The Canada Revenue Agency says that only companies with physical presence in Canada are required to register to collect taxes. Many out of Canada tech companies have decided not to collect sales tax from Canadians.

Quebec said it does not need Canada to join in, and it can go it alone by enforcing digital tax collection by itself. It said it plans to collect $30m in additional taxes. It is interesting to see why they are so excited to collect only $30m while their overall tax collection is around $17 billion. Some say this will alienate businesses to do business in the province or sell to users there. Some others say that Netflix , Amazon , etc. users might use addresses in other provinces to save hundreds of dollars a year.

Quebec now needs to account for thousands of companies selling digital goods and services to consumers in Quebec.

Quebec proudly proclaimed on January 9th, 2019 that 75 international companies have registered in Quebec to collect taxes including Google, Amazon, Spotify and Netflix. Facebook told Quebec to wait few more weeks before they can get around to it.

Quebec cautions businesses with no physical presence in the province but selling to consumers there that “the penalties provided for in the existing tax legislation will be imposed on non-resident suppliers that have not complied with the new obligations.”

Quebec’s imposed threshold for sales tax is very low at $30,000 in sales when compared to other jurisdiction. For example Japan requires $120,000+ and over while Switzerland requires $135,000+ to start collecting and ignore everyone else.

Some say that just remitting sales tax on those $30k will be a big headache for businesses everywhere as the accounting services will probably costs more than about $2.9k (0.09975% in Quebec provincial taxes) you will need to collect and remit.

Quebec might need to wait for some international standards to be set or Canada as whole to join in.

After NYC Loses Amazon’s HQ2 – Toronto Tries Again

As you probably have already heard NYC lost its Amazon HQ2 due to much publicized debate in New York City about why a city should subsidize a company with billions of dollars in profits when they can put money to better use to address issues such as shortage of housing and poverty.

Amazon decided to pull out of New York on Thursday last week due to tremendous pressure put by local government. Amazon was supposed to invest billions of dollars and hire 50,000 high-paying mainly tech jobs.

“A number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward.”

Amazon Inc.

This development might help Donald Trump to get reelected in few years as Republicans can paint Democrats as anti-business and not open for business.

Some local companies were not happy with this announcement.

“I’m really upset because I don’t think they realized what they did. And they’re proud of it? They think they did something lovely? They wanted the political gain, they should have done it in a different way. They get put into office for us, not to work for themselves.”

Gianna Cerbone, Restaurant Owner in interview with New York Times

Within hours of Amazon’s announcement that they are pulling out of the city, Toronto Mayor was quick to try to entice them to come to Toronto again.

Amazon said in a statement that it did “not intend to reopen the HQ2 search at this time.” Even if they would even consider Toronto, some Toronto residents like John Tokatlidis were not so happy about this idea.

“Never mind Amazon. How are you improving our public transit?For one, why is Dundas West Station and the Up Express/Go Station not connected? It’s also not accessible for some citizens. We need you to prioritize and fix the issues. Homelessness on the rise. You are pushing runaway development to make this your Mega city that you have forgotten your election promises. Get to work Mr Tory, do the job you were elected to do! “

John Tokatlidis, Toronto’s resident in Facebook comment

Netflix to add Production Hub in Toronto, To Create 1850 Jobs

Netflix just announced that it will be launching film and production hub at Toronto’s waterfront studio district.

They will have 84,580 square feet of space, that they are currently leasing, and will start filming within the next few weeks.

In 4-5 months Netflix is expected to move to even bigger venue with 164,000 square there.

This will help them with their production of series and films, including the horror anthology series Guillermo del Toro Presents Ten After Midnight, the film Let It Snow and others. Netflix claims that the new hub in Toronto will add 1,850 jobs per year.

Mayor John Tory has recently been talking and hinting about the Netflix studio over the last few months but it only got confirmed this week.

“I’ve been excited from day one about the interest Netflix has shown in establishing a much bigger presence in Toronto. Great crews, great studio space, great customer service and great companies like Netflix make Toronto the best place in North America to make television shows and movies.”

John Tory

Netflix has been in the news in Canada a lot lately due to their decision to invest $500 million into Canada and Quebec’s decision to tax foreign media companies including Netflix.

Is Ubisoft Hurting Canadian Tech Businesses?

National Post, a Canadian newspaper, as well as La Press, Montreal based French newspaper, recently published an op-ed piece about why they think Ubisoft is taking away talent from other tech firms across Canada. Here is a short summary.

Ubisoft has generated over $2.6 billion dollars in revenues last year, and is currently employing over 4,000 in the province of Quebec. It has also promised to invest further $9 billion dollars over the next 8 years into the province of Quebec.

But now, as pointed out by National Post in English and La Presse, Ubisoft became so successful it has started to hurt local tech companies because they can not attract and hire talent like Ubisoft can.

Quebec subsides gaming industry by providing the tax credit — between 26.25 and 37.5 % of total salaries paid to employees developing video games and other related multimedia products.

It made sense to subsidize the industry 10-15 years ago when Quebec’s economy was in a recession and dying for companies to come there, but now with shortage of IT staff in thousands, it might be the time to end the subsidy according to few local tech companies.

Eric Boyko, the CEO of Stingray Digital Group, a company headofficed in Quebec with about 250 staff in Montreal and another 200 in other places, criticized Quebec’s government decision to keep the subsidy:

“Every CEO I speak to in Montreal and in Quebec, their No. 1 challenge is attracting young employees and technology employees.” Boyko says it is outrageous that gaming companies can get the same employees as they hire at Stingray at up to 37.5% discount.

Eric Boyko, the CEO of Stingray Digital Group

Boyko also said that Ubisoft drives up the competition for software developers and therefore ups the salaries by up to 20 to 30 per cent, to around $80,000 to $120,000.

Dax Dasilva, CEO of Lightspeed, another decently sized software company in Quebec, said in his interview to the Globe and Mail:

Despite the sizable contribution domestic technology companies make toward Quebec’s economic prosperity, government policies regarding innovation have featured incentivizing for the expansion of foreign branch plants in Quebec over the growth and success of homegrown companies locally and around the world. This has had a negative effect on Quebec’s ability to scale domestic companies into global giants.

Canada is already facing a high-skills talent creation and retention problem, particularly in the digital industries. A recent study from the Information and Communications Technology Council states there will be nearly 220,000 unfilled tech jobs across Canada by 2020. In Quebec’s tech sector, we have been at full employment for a decade.

Despite this, government officials in Quebec and across Canada have been investing considerable amounts of time, energy and political capital into attracting multinational technology companies to Canada without any studies on the effect they have on the domestic tech ecosystem and our economy as a whole.

More concerning, these large companies pay little to no taxes to the governments underpinning their growth, as the profits they earn are realized at their foreign headquarters – not in Quebec. Local wealth creation is important because the taxes domestic companies pay on their revenues are reinvested by governments into the important social and infrastructure programs all businesses use and Quebeckers care about. The same goes for the capital gains reinvested by local investors and funds such as Caisse de dépot et placement du Québec, Fonds de solidarité FTQ and others.

Boyko continued saying that the foreign company that gets subsidies to come to Quebec does not create 300 jobs, but it instead steals 300 jobs from local companies.

Yannis Mallat, who runs Quebec’s Ubisoft office does not agree with Dasilva and Boyoko saying that:

“This program is helping to make Quebec and Quebecers richer. We are contributing to net growth in terms of the economy. When you [make] such a big investment, of course you want some guarantees.”

The Institut du Quebec recently published a new study that states that Quebec about 100,000 jobs are un-filled right now. South Ontario and Vancouver are in very similar positions even though their subsidies are not as generous.

What we need to do in Canada now with this historically low unemployment rate is to grow our wealth, not just create jobs.

Maybe instead of trying to import success we can give local tech companies a chance to grow. The new study, Narwhals Top 40 List, pointed out that Canada has failed to produce even one billion dollar business in the last 3 years while US for example had over 19 companies that grew to be valued at over $1b in the same period of time.

While tax subsidies might have been a good idea in 1995 when it was first created – now they make no sense according to La Presse – as we have now very mature market with a well established industry. If we would eliminate the tax credits, the jobs will not be lost, but rather transferred to other companies that are starving for some good talent.

Nova Scotia Crypto-Exchange Can’t Pay Investors $250m after its CEO’s Death

Canadian firm Quadriga CX based in Nova Scotia says it will not be able to pay its customers and investors the $250m because its CEO, Gerald Cotten, died while on a trip to India.

The company says Cotten was the only one who knew the passwords and security keys to the company’s funds.

The Supreme Court of Nova Scotia on Tuesday approved protection againsts creditors for 30 days court filings revealed.

Investors and customers were furious when they found out that they were not getting paid and found the whole ordeal very suspicious as the company has $250m in their accounts.

In a note on Facebook , company and Cotton’s wife said that Cotton died while on a trip to India to open an orphanage. Cotton’s wife said that he always used secured and encrypted laptop and no matter how hard she searched she was not able to unlock it.

This is the first ever a company “loses” so much money it owns to its investors and clients due to one person losing digital keys.

Frustration Grows

Frustrated investors took to Twitter and claim that this might be the biggest scam ever when it comes to digital investments.

Some people twitted their frustration because they lost so much money

When company’s exchanged closed they had close to 63,000 users with over $180 million in cryptocurrency and $70 million in Canadian dollars.

One user invested as much as $70 million dollars.

Something does not add up

What’s even more interesting Cotten signed a will few months before his death designating his wife (whom he married just few months before his death) to be the executor of his real estate. He has also assigned $100,000 to make sure someone would take care of his two pet dog chihuahuas, Nitro and Gully. He had also owned an airplane and some housing in British Columbia and Nova Scotia, according to The Globe and Mail investigation.

To add to the mystery the Indian state of Rajasthan published certificate of his death but declined to provide any further comment. On the death certificate Mr Cotten’s name was misspelled as Cottan.

Some people also dispute the reason for his death – officially claimed as Crohn’s decease, inflammatory bowel disease, some say it is very rare to die from. According to doctors, patients with Crohn’s decease have 97% survival rate if they follow a proper treatment plan.

In Conclusion

Dean Skurka, VP for finance and compliance at Canadian cryptocurrency platform,, said that he thinks with cases like this “highlights the need for regulation” of crypto exchanges to make sure things like this will not happen in the future.

Toronto Beats Out Seattle to Be One of the World’s Best Tech City

According to the new study conducted by Savills, real estate property management firm, New York City is the Word’s #1 Tech City. Amazon had a good hunch when they decided to open HQ2 there.

New York did well scoring #1, while San Francisco was right behind #2, and London was #3. Savills Tech Cities index measures what makes the cities successful. The index scores cities on the costs of living and doing business, investment opportunities, real estate prices and access to transit, among other things.

According to the report access to amazing talent and NYC reputation as a centre of commerce makes New York the global leader.

Toronto was the only Canadian city on the list placing #11 right before Seattle #12.

Report also pointed out that Chinese cities made a big jump this year. VC investments in Chinese cities account for more money than the US cities. Beijing, for example, recorded an average $34 billion of VC p.a. in the last three years, higher than New York and San Francisco.

Toronto did not score that well on VC investments when compared to other cities like Beijing or New York.

Toronto did not do so well on the cost of real estate as well. It is much more expensive to rent an office as well as a dwelling when compared to other cities. Toronto’s Mainstream residential rent (Per week, USD) is $360 and Coworking cost (desk in a private office, per month, USD) is $960. The rates are on par with New York City and San Francisco.

Toronto also did poorly on mobility ranking, the ease a city’s population can get from A to B is an important consideration. Toronto was #25 out of 30 when it came to commuting, public transit. Something that we need to improve on to overhaul existing infrastructure over years to come. London, Stockholm and NYC took top 3 spots when it came to mobility.