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Research In Motion sets up 'second home' in Nova Scotia

Nov. 25, 2005. 05:05 PM

HALIFAX — Research In Motion Ltd., makers of the wildly popular BlackBerry hand-held computer, is setting up its "second home" in Halifax, promising a technical support centre that will bring 1,250 jobs to the city.

Surrounded by beaming federal Liberal politicians, co-chief executive Jim Balsillie said the Waterloo, Ont.-based firm decided to invest $230 million over five years because there's an untapped, high-technology workforce in the Halifax region.

Also, the Nova Scotia government offered $19 million in subsidies, including $14 million in payroll rebates and $5 million for training and recruitment.

In an announcement staged today before a merry crowd of local businesspeople, Balsillie was handed a Santa Claus hat by Liberal cabinet minister Geoff Regan, who likened the decision to Christmas Day.

"You come bearing gifts . . . We're proud of your success, and your decision to stay in Canada," said Regan, noting that Halifax edged out several U.S. cities that were on the short list.

Ottawa has promised to give the company (TSX: RIM) access to all of its financial assistance programs on the East Coast, but there were no specific figures released today.

The new support centre will help RIM respond to concerns it needs to bolster technical support for customers as it tries to fend of growing competition.

Investors were rattled by rival Palm Inc.'s recent decision to use a version of Microsoft Windows in two of its Treo handheld models, both of which are e-mail enabled cellphones with keyboards like that of the BlackBerry.

Meanwhile, a fresh slate of products from Nokia and Motorola emerged this year.

Earlier this week, RIM's share price on the New York Stock Exchange fell 90 cents to $66.28 after it announced projected subscriber growth fell slightly because of product launch delays.

Balsillie said that within a year about 250 employees — paid an average of between $45,000 and $48,000, including benefits — will be working in Halifax to provide assistance to the hundreds of carriers that operate BlackBerry networks.

"The product works well, but there has to be a lot of activity going on behind the scenes to support that," said Balsillie.

The executive said the announcement had nothing to do with the federal election, which is widely expected to begin next week.

Rather, Balsillie credited Premier John Hamm for travelling to Waterloo about a month ago to pitch the benefits of Nova Scotia.

At the time, the decision had been taken to go south of the border, but the Nova Scotia team persuaded the company to reverse its decision.

Balsillie also said he spent hours chatting about the prospects of moving to the Maritimes with Scott Brison, the federal minister of public works, while the two were attending the recent Rolling Stones concert in Moncton, N.B., earlier this year.

The company, which has 4,500 employees, has struggled to find qualified employees in Waterloo. There are more than 400 high-tech companies within its boundaries.

The company said it expects to begin hiring through job fairs beginning in January.