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Canadian high-tech could benefit WNY Silicon Valley of Canada two hours from Buffalo

The technology hotbed of Silicon Valley is 2,700 miles from Buffalo, too far for area companies and institutions to easily connect with their Northern California peers.

But the thriving Silicon Valley of Canada -- with hundreds of companies in the high-tech sector -- lies two hours away.

Ontario's high-tech corridor offers businesses in the Buffalo Niagara region an ideal opportunity to build partnerships with their peers, experts say.

"We use [the border] as a wall instead of a bridge," said Bob Clerici, vice president for sales and marketing of Inergex, a technology consulting firm in Buffalo considering expansion into Canada.

The area stretching from Toronto to Kitchener-Waterloo is, for cultural and geographic reasons, a natural potential market for Western New York firms.

A number of local companies, from medical-device maker Gaymar Industries to Appraisal.com, have made this move.

But more firms can and should take advantage of our proximity to Ontario, said representatives from the infoTech Niagara trade group and others.

"All we're doing is encouraging people to shop at the outlet mall. We should be encouraging a much higher level of collaboration," said Rohini K. Srihari, a Waterloo native who runs Janya, an Amherst software firm.

At the same time, the Canadian consulate general's office here and the Buffalo Niagara Enterprise business group are working to persuade more Canadian companies to invest in this area.

They point to the billions of dollars traded between the two countries and argue that the international border isn't an obstacle to mutually beneficial business partnerships.

"It's one big market," said Paul Buckley, president of Applied Sciences Group, a software company in Cheektowaga that has limited operations in Ontario. "We should not be parochial. There's just too much business there."

>Economy transformed

In addition to the giant business market of Toronto, Ontario also is home to the emerging Kitchener-Waterloo-Cambridge high-tech sector.

Known as the Technology Triangle, that region hosts 400 companies and 18,000 jobs in the high-tech realm, including giant Research in Motion, maker of the BlackBerry.

The progress made in the Waterloo area holds lessons for Buffalo Niagara, said Christine G. Plowucha, executive director of the infoTech Niagara group.

University research has transformed the economy and culture of the once blue-collar Waterloo region, Srihari said.

"Before, people used to graduate from the University of Waterloo and leave. Now they can stay there," she said. "I would love to see the same thing happen here. I think it's possible."

Western New York already supports 650 high-tech companies that employ 5,400 workers, and employment in this sector has grown 5.8 percent annually, according to the Erie County Industrial Development Agency.

Buffalo is the 24th-largest Internet traffic hub, thanks in part to its position as an entry point into Ontario, a study by the Progressive Policy Institute found.

And residents on both sides of the border speak the same language, share interests in hockey and Tim Hortons coffee and endure comparably high taxes and poor weather.

"If one is looking for an easy way to test the waters of international business, Ontario is certainly the place," said Mark Yellen, chairman of Buffalo's Appraisal.com, which provides real-estate data to appraisers and other clients and has started working in Canada.

Data broken down by region is hard to come by.

But, overall, 19 percent of American trade goes to Canada, noted Michael Flaherty, senior trade commissioner with the Canadian consulate general's office in Buffalo.

Ontario businesses exported goods worth $10.7 billion to New York in 2006, while New York businesses sent $9.7 billion in goods to Ontario, according to Canadian government data.

Several major American corporations have facilities on both sides of the border and treat the binational region as part of a seamless supply chain.

For example, Ford Motor Co.'s Buffalo Ford Stamping Plant in Hamburg supplies parts for vehicles that are assembled at Ford's plant in Oakville, Ont., Flaherty said. "Western New York and Southern Ontario in many industries are part of a North American production system. I like to say we make stuff together."

>Physical presence

Some companies have established a physical presence in the province, while other businesses have started doing consulting work there or have partnered with a Canadian firm.

Gaymar Industries in 2002 bought a plant in the Kitchener-Waterloo area that housed Waterloo Bedding, a Gaymar supplier, said Thomas P. Stewart, president and chief operating officer of the Orchard Park manufacturer of medical devices.

"With that, it gave us some manufacturing capability that we didn't have before," he said. "It also gave us access to a larger part of the Canadian market."

There are obstacles, local business officials said, ranging from different holidays to taxes, work visas and other serious issues.

And the looming security clampdown at American-Canadian border crossings could make movement across the border more difficult.

But that's not as troubling for a high-tech company, executives said, because their work product travels over fiber-optic cable instead of over bridges.

While Western New York companies are investing in Ontario, at least one area agency is launching an effort to bring Canadian companies here.

>Services provided

Buffalo Niagara Enterprise has hired a Hamilton, Ont., consulting company, Footprint Partners, to survey Canadian firms that have moved into Western New York. The feedback will be used to shape a public-relations strategy aimed at persuading more businesses to do the same.

Buffalo Niagara Enterprise and Canadian consulate general's office help steer Canadian companies to a network of service providers that are used to dealing with binational legal and financial issues.

They say Buffalo Niagara can be part of a high-tech, life sciences corridor stretching from Albany and Syracuse through Rochester and Buffalo into Southern Ontario and Toronto.

The groups couldn't provide employment figures for the Western New York offices of Canadian companies, but examples abound.

Binatech System Solutions is one. The Hamilton, Ont., firm provides information-technology services to small and mid-sized companies.

Binatech opened an office in Niagara County four years ago and moved that office and its four employees to Buffalo about two years ago, said Mike Haworth, the president and CEO.

And PharmIdeas moved its four-year-old American office from Charlotte, N.C., to Amherst in January.

The pharmaceutical consulting company, based in Oakville, Ont., initially planned to relocate its American office to a city such as Boston or Philadelphia.

But the presence of the University at Buffalo, Roswell Park Cancer Institute and local life-sciences companies made this region attractive.

"There's much more to Buffalo than the Peace Bridge and the Buffalo Sabres," said Michael Iskedjian, the president.

e-mail: swatson@buffnews.com

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