Another howler from the Globe and Mail (please hire more technology writers like Matthew Ingram who are clued in and listening rather than people like the author of this article).
The prognostication that "Web 2.0 companies cost too much to be profitable in Canada" will turn out to be just as laughable as the 1990s predictions of Apple's demise. The whole point of Web 2.0 (the read write web or whatever you want to call it) especially with affordable infrastructure like Amazon S3 and EC2 is that anybody with a great idea and great implementation skills can build a web service anywhere in the world (not just in Silicon Valley) that is useful and scalable. Not convinced? Some Canadian examples: flickr (which was reportedly profitable before being acquired by Yahoo), dabble db, bubbleshare just to name a few.
"You'll notice that there are no Web 2.0 companies on the list -- they just cost too much to be profitable in this country," Mr. Behr said. "We're not looking for something you'll see on the Internet, instead we're looking for applications that make what you see work better."