Canada Needs a Unified National Digital Strategy for its Unpredictable Digital Future
- Although the Internet, cloud computing, digital technology and the shared economy were supposed to open up opportunities for new businesses related to economic decentralization and consumer convenience, they have created a situation of rapidly growing economic inequality.
- We are moving into a new economic order where large digital technology companies must adopt more ethical practices. If not, younger generations who are interested in investing in brands that operate with ethical responsibility and not for the sole purpose of making profit will not do business with them.
- If students and researchers began to take their projects to established and well-funded commercial organizations, Canada would be much more successful in the global digital economy. For that to happen, more robust partnerships between the public sector, the private sector and financial institutions are necessary.
Canada needs to develop a unified national digital strategy, which guides the development of our digital infrastructure, promotes innovation, and protects users and their data.
How do you see the evolution of the Internet, the digital economy and our collective digital future?
When we established the Canadian Cloud Council in 2011, the word “cloud” was very much a technology-related term. Over the last decade, the word “cloud”, which has become synonymous with “Internet”, has evolved into something much more philosophical in nature. We are now at a tipping point in humanity where we are no longer able to predict or control the Internet’s evolution. The evolution of the Internet itself is tied to the evolution of the entire global economy and humanity. Over the last decade, we have seen the fastest rate of economic transfer in human history from one industry to another. The USA’s oil and gas economy has shifted to a digital economy and today, 8 to 10 people in the US have more accumulated wealth than anybody below them. There are three or four companies, arguably even two, that essentially control the entire economy. This oligopoly needs checks and balances.
“We are now at a tipping point in humanity where we are no longer able to predict or control the Internet’s evolution. The evolution of the Internet itself is tied to the evolution of the entire global economy and humanity.”
The shared economy as we know it provides a lot of value in terms of economic decentralization and consumer convenience. But, from a purely economic perspective, it has created a situation of rapidly growing economic inequality. Unless we start working together on very robust governmental policy development initiatives to put some checks and balances around digital governance and creation, we will continue to see the rapid evolution of an oligopolic economy fuelled by the mass proliferation and monetization of data.
“Even though we have tried to deploy some of these technologies with the goal of advancing a more open, accessible and secure economy, in a lot of ways the exact opposite has happened.”
One of the keynote speakers we had at our last Canadian Cloud Council Conference was the now former Chief Technology Officer of the US Department of Homeland Security. He was optimistic that even an organization like the Department of Homeland Security would ultimately figure out a way to use technology in a positive fashion and for the greater good of humanity. However, he was concerned about the speed of advancement since we are building supercomputers and an artificially intelligent infrastructure that will be much smarter than humanity very quickly. If that type of organization cannot predict what technology and humanity are going to look like three months from now, who else can?
Why are you focused on cloud technology?
I created the Canadian Cloud Council initially because I saw a real opportunity for businesses to create incremental value by using a more shared, accessible and open computing platform. Then open-sourced computing started to proliferate five or six years ago through the OpenStack Foundation and we saw the impact of Elon Musk’s open-sourced trademarking of his electric car technology.
From an industry perspective, I saw an opportunity to put forward a platform that would allow industries to grow and solve bigger problems through shared infrastructure and a diversity of ideas. We have seen that actually happen and that is the positive aspect of this evolution.
On the negative side, even though we have tried to deploy some of these technologies with the goal of advancing a more open, accessible and secure economy, in a lot of ways the exact opposite has happened.
How can Canada better deal with concerns over the privacy and security of personal data while still allowing for innovation and business growth?
From a political perspective, North America should go through the European Union’s recently developed GDPR data privacy legislation. It has cost Facebook and Google a significant amount of money in penalties related to accessing data that they should not have. This needs to happen in North America as well, but I do not think it will under Donald Trump. Having said that, these companies are publicly traded organizations that have a fiduciary obligation to increase shareholder value. They can do so most effectively by continuing their current business model of capturing people’s data and selling it to the highest bidder. However, they need to be put in check in some ways at the global level. Facebook, Google and others should make the conscious decision internally to operate businesses that are more ethical. They do not necessarily have to be forced to do so and as we move into the new economic order, organizations will start conducting themselves with more ethical gravitas voluntarily. The millennials, generation Z, and younger generations are interested in investing in brands that operate with ethical responsibility, not those that operate for the sole purpose of making profit for their shareholders. They will not do business with companies that do not align with their values.
“Unless we start working together on very robust governmental policy development initiatives to put some checks and balances around digital governance and creation, we will continue to see the rapid evolution of a oligopolic economy fuelled by the mass proliferation and monetization of data.”
How can we increase Canada’s attractiveness as a tech investment destination?
The Trudeau administration has done a great job of attracting a lot of big tech companies, specifically to Toronto. Toronto is becoming one of the most rapidly growing technology ecosystems on the planet. We have been successful at positioning Canada as a data safe haven, especially in comparison with the US under the Trump administration. We are working with big companies like Microsoft, Google and Amazon, and even smaller companies like Salesforce and DocuSign, to establish Canadian datacenter operations. These will create some diversity from a data perspective and open up opportunities to sell data-safe solutions.
When I first started the Canadian Cloud Council, data sovereignty was a huge topic of discussion and a lot of American customers wanted to store some of their data outside the US. Since then, Canada has become one of those external data hubs for American companies because of its impressive datacenter and internet infrastructure. It is too bad that the consumers still have not seen the result of some of these positive changes; Canadians still pay the highest data rates in the first-world because we still operate in a monopolistic economy as it relates to telecommunications and the Internet.
“We have not been very good at bridging the gap between academia, research and commercialization, and it is probably the best step we can take to increase our competitiveness.”
Canada is attractive to large tech firms because Toronto is indeed a less expensive city to operate in than San Francisco, but not a lot less expensive. Obviously, the Canadian dollar always being 25 or 30 cents less than the US dollar is a reason as well. We also have a lot of really smart people here. However, I do think Canada in general does have the capability to be a much more entrepreneurial nation.
I am quite excited about what is happening in the federal government from a digital perspective. To increase our attractiveness it is very important to create a more unified national digital strategy in Canada. It is not easy and it has to happen quickly because the world is going to be a very different place a year from now, let alone 10 years from now.
What competitive advantages does Canada possess in digital technology and which sectors represent the most opportunity for us?
We have not been very good at bridging the gap between academia, research and commercialization, and it is probably the best step we can take to increase our competitiveness. For instance, Edmonton has one of the most robust artificial intelligence and machine learning hubs in the world operating in the University of Alberta, but it has yet to translate into any sort of commercial results. We are not seeing a lot of artificial intelligence and machine learning start-ups coming out of that lab that are very successful, making much money or creating value here in Canada. If we could convince students and researchers to take their projects to established and well-funded commercial organizations, we would be much more successful in the global digital economy. For that to happen, more robust partnerships between the public sector, the private sector and financial institutions are necessary.
Let us be honest, it is very difficult for companies to raise money in Canada. Venture capital organizations do not put a lot of money into start-ups here; they should be less risk averse. Canadian banks are probably the most risk averse banks on the planet.
In terms of specific sectors that look promising for Canada in the digital space, the top two would be artificial intelligence and machine learning.The other one I would say is financial technology, in which we have interesting companies like Vancouver’s Mogo and Toronto’s BitGold and GoldMoney. This is a great opportunity if Canadian banks and Canadian start-ups can work together to advance the digital banking and financial infrastructure. I think the fourth promising sector would be retail technology and Shopify has built a fantastic ecosystem for it out of Ottawa. The last one I want to bring up is the digital infrastructure space. If we can convince big companies to establish research and development operations in Canada and create economic opportunities for the brightest Canadians, people will not move to San Francisco.