Alberta's information and communications technologies (ICT) sector is looking to get more bang for its buck.

Seeking to grab an increasing share of information technology (IT) spending by the United States Department of Defence (DoD), companies in Calgary and Edmonton recently spent time discovering how they could break into the American marketplace without worrying about "Buy American" policies.

About 95 people attended two day-long Defence and Security Connector events held last week in both cities.

Wayne Karpoff, master of ceremonies for the Edmonton event held at the University of Alberta, said that recent figures show the U.S. Defence Department's IT expenditures top $22 billion.

Jack Dagley, Business Edge
David Southwell, CEO of Obsidian Research Corp. based in Edmonton, displays the company's Longbow range extender.

But Karpoff, also the vice-president and CTO of Edmonton's Yotta Yotta, a company that produces high- performance storage devices, noted the figure only included identified spending and not necessarily unacknowledged programs that do not appear in U.S. budgets.

Karpoff also said U.S. military spending is not just about guns and ammunition, as modern warfare has a strong technological edge.

"Every soldier in the (war) theatre has a GPS (global positioning device). Information from laser-guided scopes gets collected," said Karpoff. "It's very much an IT game for managing that (data)."

The question, he told Edmonton participants, was "how do we capitalize on this massive opportunity out there?" A number of experts familiar with the U.S. defence market, along with some Canadian officials to provide insight into the Canadian military market were on hand to provide some answers.

Judith Bradt of Summit Insight, a U.S.-based company that specializes in helping Canadian companies seeking American contracts, stressed that businesses must do their homework first.

There are many rules, she added, and a company can easily run afoul of them innocently and inadvertently commit fraud. One example, she noted, concerns a form questioning whether a business qualifies as a small business. The hitch, however, is that in this instance Canadian companies - even if they are small businesses - usually don't qualify under this U.S.-oriented definition.

However, Bradt did say that provisions of the North American Free Trade Agreement can override Buy American rules - although there are exceptions as U.S. state and local governments are not covered by the agreement.

Bradt emphasized that entering the U.S. market is not an impossible task. "There are logical steps," she said, "but you will spend time and money."

One of the companies looking to get further into the U.S. market is Edmonton startup firm Obsidian Research Corp.

Obsidian's Longbow, an infiniband range extender - a product that's used for high performance computer to computer communication, fast enough to move the contents of a DVD from coast to coast in 4.7 seconds - will be unveiled later this year.

It already has garnered interest and ongoing contracts from the Naval Research Labs, one of the laboratories responsible for U.S. military and intelligence research and development, said Obsidian president and CEO David Southwell.

The company is also looking at other potential U.S. government clients such as those in the intelligence sector.

"I've pencilled in a number of people I want to meet with in terms of accessing the defence market and the military market," Southwell said in an interview at the Edmonton conference.

"There's definitely an issue approaching these people as Canadians."

Southwell added while a one-day event meant a steep learning curve, "I'm now aware of what's available."

For Wael Badawy, founder and director of Calgary-based Smart Camera, the opportunity to meet with the people who can help get his product into the U.S. security market is what made the Edmonton event worthwhile.

"I came up special for this conference because we do have lots of interest in doing direct sales and having direct interaction with Homeland Security (in the United States). We believe our product is much better than the current product they have for outdoor security," he said.

Smart Camera, a spinoff from the University of Calgary, has developed technology that can understand intruders - either human or non-human such as vehicles - and generate alarms or alerts. Monitoring borders is one area where Badawy sees a market for his product.

"We can actually communicate with each other, we can exchange ideas," Badawy said. "That's why I find this a good fit and that is why I came here to Edmonton and why (tomorrow) I'm going to the Calgary event as well."

While Karpoff said entering the U.S. military market might take companies outside their comfort zone, he pointed out that there is definitely a buck to be made.

Preliminary feedback shows the event was well received and that it was productive, with Karpoff estimating between 10 to 12 partnerships forged. "Very clearly, they would not have happened without the conference," said Karpoff.

The Defence and Security Connector events were organized and sponsored by Alberta's ICT Council, Edmonton Economic Development Corp. and Calgary Technologies Inc., as well as government and private industry partners (Laura Severs can be reached at laura@businessedge.ca)

TIPS TO ENTER THE U.S. MILITARY MARKET Companies considering entering the U.S. government's military IT marketplace as a prime or subcontractor can get a leg up on the competition with a few easy steps, officials familiar with the sector say. Basic tips include:

* Follow the rules. Most of the companies don't follow the rules as set out by the various government organizations. Following the rules could give you a leg up on your competition even if your product is priced higher.

* Expect to put in time and money, possibly as long as two years, before you will get a return on your investment.

* Deal with people who know the sector. For example, turn to trade commissioners who can point you in the right direction.

* People do business with people they like and trust, be they American or Canadian. Also, make sure that you get introduced to the right people by the right people.

* Use the Internet, including these possible starting points: www.firstgov.gov (the U.S. government's official web portal) and www.dfait-maeci.gc.ca/sell2USgov/menu-en.asp (Canada's Department of Foreign Affairs and International Trade site on how to sell to the U.S. government.)