OPINION: Why Ottawa shouldn

Research in Motion Inc. raised the issue of national interest last month when it belatedly objected to the rules of the Nortel carrier wireless auction. Nortel Networks Corp. started looking for buyers for its assets nearly a year ago, and has been protected from creditors since January.

Meanwhile, the House of Commons Standing Committee on Industry, Science and Technology announced it will hold hearings “on issues related to the proposed sale of certain Nortel Networks Corporation assets.” Witnesses are scheduled to appear on behalf of Nortel, Ericsson, Industry Canada and Research in Motion (RIM) Inc. Waterloo, Ont.-based RIM last month claimed it was prevented from bidding on the Nortel carrier wireless unit, plus “certain other assets,” and asked the federal government to intervene.

Here are some questions committee members should ask Research in Motion:

-How many Nortel employees would be offered employment by Research in Motion if RIM buys the carrier wireless assets?

-On July 20, RIM stated it “would be prepared to pay in the range of US $1.1 billion … for the CDMA and Long Term Evolution Access businesses and certain other Nortel assets.” Which other assets is RIM referring to?

-On July 20, RIM stated the “loss of Canadian ownership” of Nortel’s CDMA and LTE business “may significantly, adversely affect national interests, with potential national security implications …” Who will be harmed and how, if Ericsson is successful in buyin the CDMA and LTE business? How will national security be harmed? How would a RIM acquisition prevent this harm?

Those who are calling on the government to intervene should keep in mind a few key facts.

Research in Motion has had a few years to put its money where its mouth is but waited until last month. While it would have been too expensive for anyone to acquire Nortel when it was trading at $123 in 2000, the share price dropped to 32 cents (and would have been three cents if not for a 10-for-one consolidation) by the end of last year.

Anyone wanting control over the company could have bought Nortel bonds and had some say in the court-supervised bankruptcy process.

During its heyday in 2000, Nortel was a Canadian company only because its head office was in Canada. The bulk of its operations were outside Canada, in centres such as Richardson, Texas and Research Triangle Park in North Carolina.

RIM’s claims of “national security implications,” were unsubstantiated, prior to the parliamentary committee hearings. At the time, RIM had made no promises to hire any Nortel employees or protect former employees’ pensions or severance.

RIM’s co-CEO, Jim Balsillie is accountable to his shareholders. He can attempt to cherry-pick Nortel’s assets and ask politicians to micromanage a court-supervised process. But it’s time to face the fact that this is not about some higher cause, other than RIM’s balance sheet.

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Jim Love, Chief Content Officer, IT World Canada

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