Government Driven Innovation Policies, MacDonald Dettwiler, Export Development Canada, CSA Grants & Elon Musk

         By Chuck Black

Here are some stories we're currently tracking for the Commercial Space blog:

One type of government driven innovation policy. Cartoon c/o Lisa Benson/ Washington Post. 

• The annual Canadian Science Policy Conference (CSPC), this year being held from November 8th - 10th, 2016 in Ottawa, has traditionally filled an important Canadian need for non-partisan, inclusive and national dialogue on science, technology and innovation policy. 

But this year, the event might carry more weight than usual.

As outlined in the June 13th, 2016 post "Government Announces Comprehensive Review of Canadian Science," the Federal government has announced an independent panel, to review the activities of the National Research Council (NRC), the Social Sciences and Humanities Research Council (SSHRC), the Natural Sciences and Engineering Research Council (NSERC), the Canadian Space Agency (CSA) and the Canadian Institutes of Health Research (CIHR), as well as programs like the Canada Foundation for Innovation (CFI), the various Canada Research Chairs, Genome Canada and others.

That panel, expected to report before the end of this year, will affect all who normally attend and many are hoping that expected policy changes will be announced in time for discussion at this year's event. 

Commercial Space blog correspondents will be on-site at the Shaw Centre during this year's CSPC to keep readers up to date on breaking news and activities. Expect to see thrills, chills and more than a few spills.

EDC, a Federally owned crown corporation with headquarters in Ottawa. As outlined on the its website, "Export Development Canada provides Canadian exporters with trade financing, export credit insurance and bonding services, as well as foreign market expertise." Photo c/o Corporate Knights.

• Speaking of government policies designed to encourage innovation, questions are arising as to whether or not Richmond, BC. based MacDonald Dettwiler (MDA), should remain eligible for Export Development Canada (EDC) money and assistance when it flows through foreign subsidiaries and facilities with no perceived direct benefit to Canada. 

As outlined in the October 18th, 2016 National Post article, "EDC financing satellite construction in California because of ‘direct benefit’ to Canada," EDC funds have recently been used for several non-Canadian projects being built in California for Spain and Azerbaijan.

According to the article,"in March 2015, EDC announced it was providing $190 million to a Spanish telecommunications operator for a satellite to be built by SSL (Space Systems Loral, a California based subsidiary of Delaware incorporated SSL MDA Holdings, the holding company which controls both MDA and SSL)... Seven months later (the Republic of) Azerbaijan said EDC was financing another telecommunications satellite at the U.S. facility at a cost of about $191 million. In its news release about the Azerbaijan satellite, MDA highlighted SSL’s status as a U.S. company." 

Eligibility for EDC support gives the US based SSL a competitive advantage against other US based organizations, since "the U.S. government’s version of EDC, (the) Export-Import Bank (of the United States), has been closed for large transactions since last year because of U.S. Congressional opposition to the organization."

The article also contained quotes from Steve Staples, the vice-president of the Rideau Institute; Brian Masse, the New Democratic Party’s critic monitoring the innovation, science and economic development file (who said last Monday in the House of Commons that MDA has shifted to US control “right there under the Liberals’ noses.”); Innovation Minister Navdeep Bains and Commercial Space blog editor Chuck Black.

RADARSAT-2 product description from the MDA website. RADARSAT-2 is an Earth observation satellite launched in 2007 from the Baikonur Cosmodrome. It's owned and operated by MDA, which resells data collected by the satellite for profit to Canadians and others. For the complete document, simply click on the graphic above. Graphic c/o MDA.

• Of course, EDC funds, financing and guarantees are not the only mechanisms the Federal government uses to support innovation and promote Canadian companies. 

As outlined in the October 22nd, 2016 post, "The Canadian Space Agency Gave Out Almost $5Mln CDN in Grants and Contributions Last Quarter!," the CSA provided fourteen grants to various public and private organization in Q2 2016 (from March - June 2016) and nine of those grants were made to academic institutions in order to develop new uses for data derived from interferometric synthetic aperture radar (InSAR).

At present, the primary Canadian supplier of InSAR data is MDA, which collects and resells the data as part of its RADARSAT-2 operational responsibilities. And, as outlined in the September 8th, 2014 post, "Space Agency Funds Training for RADARSAT Researchers," the current grants grew out of an earlier decision to "develop a larger pool of Canadian post-secondary researchers able to work with RADARSAT-2 data." 

The nine grants were for small amounts (approximately $50K CDN each) and arguments can certainly be made that developing new uses for data derived from Canadian space assets is good for Canada, since it increases our national capabilities. 

An argument could also be made that MDA benefits from having our national space agency fund the development of new applications for its products. 

Overall, the story is simply a reminder that developing government policy focused around encouraging "innovation" is a complex business with many unknowns.

SpaceX founder and CEO Elon Musk. Photo c/o The Verge.

• Unless, of course, you're Elon Musk.

As outlined in the October 23rd, 2016 Verge post, "Here’s what we learned from Elon Musk’s SpaceX Reddit AMA," the South African-born Canadian-American business magnate, investor, engineer and inventor "took to Reddit this evening for an Ask Me Anything session," to supplement his September 27th, 2016 presentation from the 67th International Astronautical Conference in Guadalajara, Mexico.

As outlined in the October 3rd, 2016 post, "Mr. Musk Goes to Mars," Musk used the earlier event to outline his ambitious plans to colonize the red planet.

Musk has spent his career solving problems (in this case, the problems surrounding the need to make humans a "multi-planet species") under the assumption that innovation and other benefits derive naturally from an environment created to solve complex problems.

It's a solution which Canadians were once well able to grasp, especially when it came to expanding our northern communications (which led directly to the creation of Telesat) or building the International Space Station (which led SPAR Aerospace to create the first Canadarm). 

But it might also be a lesson we've mostly forgotten. 

For more on Musk's Reddit presentation, check out the October 23rd, 2016 Reddit post, "I am Elon Musk, ask me anything about becoming a spacefaring civ!"

For more updates on these and other stories, be sure to check out future posts on the Commercial Space blog.

Chuck Black.

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Chuck Black is the editor of the Commercial Space blog.