It’s time for Canada to become more Canada-focused

In looking to build Canada’s future in the knowledge-based digital economy — a world of artificial intelligence, robotics, and 5G — the Trudeau government often appears more focussed on attracting foreign Big Tech than in building up our own home-grown champions.

Yet these foreign R&D branch plants means that much Canadian talent and research is used to create intellectual property that will be utilized elsewhere to create jobs and wealth elsewhere. This makes us an incubator for the benefit of others.

Instead, we need to prioritize commercializing new knowledge and scaling up our own Canadian companies, capturing more benefits for Canada. That means developing Canadian intellectual property and owning it in Canada. IP is the strategic asset in the new economy.

As international giants recruit our best graduates and their professors, buy up promising Canadian tech start-ups, and lobby government to adopt polices, such as those affecting intellectual property ownership or privacy, that favour the tech giants, they bring significant corporate power and money, the wow factor (our politicians get to meet Tech Giant superstars) and much experience in lobbying policymakers.

A recent expose published by Britain’s Guardian newspaper described a cache of Facebook documents that outline how Facebook executives promise investments while engaging in lobbying against strict data privacy legislation.

In one example, Facebook used the promise of siting a new data centre in Canada, with the promise of jobs, to win legislative guarantees. When Canada hesitated to grant concessions Facebook wanted, the documents say “Sheryl [Sandberg] took a firm approach and outlined that a decision on the data centre was imminent. She emphasized that if we could not get comfort from the Canadian government on the jurisdiction issue, we had other options.” The documents claim that the-then Industry Minister, Christian Paradis, supplied the agreement Facebook wanted the same day. Sandberg is Facebook’s chief operating officer.

But perhaps no example is more striking than the rapid growth of Alphabet/Google in Canada, where former chair Eric Schmidt has assiduously courted Prime Minister Justin Trudeau, first meeting with Trudeau in 2015, right after the Trudeau government took office.

Since then Trudeau has held other private meetings with Schmidt, helped launch the opening of Google’s major R&D facility in Waterloo, championed Sidewalk Labs (an Alphabet subsidiary) to develop the Toronto waterfront, and joined Schmidt at a public love-in at Google’s Digital North high-tech event in Toronto.

Google has had R&D links with Canada since at least 2005, but its drive to capitalize on Canada’s talent and research took off this decade after Canadian researchers had already made important contributions to Google’s business success. It supported Geoffrey Hinton, a pioneering AI research scientist at the University of Toronto, and in 2013 acquired DNNresearch, a small AI start-up founded by Hinton and two graduate students. Hinton became a Google executive in Toronto’s AI community.

In January 2016 Trudeau helped launch the opening of a major Google R&D facility in Waterloo, established there to tap into Waterloo’s talent and research base and the region’s vibrant start-up community. The facility has played an important role in developing Google products including Gmail, Google Fibre, Chrome, and Google Ads. It employs about 500 engineers and other skilled talent.

In Budget 2017, the Trudeau government announced $125 million for university-based AI research centres in Edmonton, Toronto-Waterloo and Montreal. Google quickly responded. DeepMind, a leading British AI company Google had acquired in 2014, announced it would establish its first non-British research lab at the University of Alberta. It would be run by the university’s three top AI scientists while building up its own research team there.

A few months later, DeepMind announced it would open a second Canadian research lab, in Montreal. It recruited a leading AI professor at McGill University, Doina Precup, to run the research lab.

Meanwhile, in Toronto, Google announced it would join the Vector Institute at the University of Toronto, a major institute to train AI talent and conduct AI research. Hinton would play a leading role at the Institute.

At the same time, Google Brain, an AI long-term research team that works with leading AI researchers worldwide, set up offices in Toronto and Montreal, both of which are recruiting Canadian talent.

The key role of Alphabet/Google in the Trudeau government’s innovation strategy was highlighted in an October 2017 briefing from the Privy Council Office for the announcement that Sidewalk Labs had won the RFP to develop smart city technologies on Toronto’s waterfront. Federal officials said this announcement would reinforce already close ties between Alphabet/Google and the Trudeau government noting “the selection of Sidewalk Labs would complement recent efforts to grow Alphabet’s partnerships and operational footprint in Canada.”

At Google’s Digital North tech conference in Toronto the following month, Schmidt went out of his way to lavish praise on Trudeau. “I do a lot with leaders round the world, and there is no leader who can articulate a vision around innovation and growth like your Prime Minister,” he said. But is it the right vision?

David Crane can be reached at [email protected].

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David Crane
David Crane
David Crane is a noted commentator on Canadian innovation issues. He was previously a business and economics writer with the Toronto Star.

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