Eric Schmidt, the former executive chairman of Alphabet Inc. who championed Sidewalk Labs’ smart-city bid for a lucrative slice of Toronto’s waterfront, brushed aside concerns the project will leave Canadian companies at a disadvantage during an appearance in the city on Tuesday.
“The evidence is that when we are working in the field, like in Toronto, there are enormous spinoffs,” Mr. Schmidt said when The Globe and Mail raised local-tech chief executives’ concerns about Alphabet’s access to the massive pool of data the proposed smart, tech-driven community would generate.
Mr. Schmidt, who since announcing Sidewalk’s bid last fall has stepped down to the position of technical adviser, remains on the board of Google LLC’s parent company. He made the comments at the end of a session at Toronto’s Elevate TechFest.
For nearly a year, Sidewalk and its parent Alphabet have been trying to sell Toronto on Quayside, a proposed 12-acre lakeside development built with sensor-laden urban planning. In partnership with the tripartite development organization Waterfront Toronto, it is being pitched as a tech-centric neighbourhood with proposed features ranging from robotic garbage sorting to automated heating and cooling.
But there has been much chatter among Canadian tech executives and intellectual-property (IP) experts over the advantages Alphabet and Sidewalk might have in monetizing data generated by the project, and whether Canadian innovators and taxpayers would receive a fair chance to use the data and generate long-term wealth from what could be a world-pioneering smart community.
That concern has not dissipated as more details on Quayside have become available, including a Globe report on a procurement document that revealed Sidewalk Labs was seeking full ownership of intellectual property of designs it was sourcing for the project.
Former Research in Motion co-chief executive Jim Balsillie, a smartphone pioneer and IP hawk, said the document showed that Alphabet was “systematically building their IP and data assets” as Waterfront Toronto, which represents all levels of government, sat idly by.
That concern was extended Tuesday after Mr. Schmidt’s conference appearance, during which he repeatedly complimented Canadian researchers’ advances in the AI discipline of deep learning, an area that has helped Alphabet cement its reputation as a global tech giant.
After watching Mr. Schmidt’s exchange with The Globe, Mark Pavlidis, chief technology officer of the Toronto digital-image company Flixel Photos Inc., said he’s concerned “it wasn’t clear how much access those startups would have to that wealth of data that would be collected through this project.”
Benjamin Bergen, executive director of the Council of Canadian Innovators, said in an e-mail that his group of more than 100 fast-scaling Canadian companies remained concerned about Sidewalk’s IP ownership requests. “There is still no strategy in place to see wealth generation for the Canadian economy,” Mr. Bergen wrote. “The benefits of Canadian IP and data from our cities should generate billions for our economy.”
During Mr. Schmidt’s panel talk with Mark Machin, the chief executive of the Canada Pension Plan Investment Board, they widely discussed the Canadian and global economies, the growing success of Canadian startups and tech companies, as well as the value of data as artificial-intelligence (AI) software becomes more sophisticated. “Whether we like it or not, the winners tend to be people who have a great deal of data,” Mr. Schmidt said.
Alphabet is one of the world’s biggest data processors and is widely investing in AI technology and researchers, including in its Canadian offices. The Globe asked Mr. Schmidt about Canadians’ concerns during a conference question-and-answer period.
Alphabet tends to initiate an economic boom when it enters a city or country, he said. “Employees of ours quit and do startups, which is okay.”
The Quayside project, he continued, could help reduce congestion and create more local real estate space. “We have, at least, initial strategies to help solve these problems.”
In a later onstage conversation with television journalist Amanda Lang, Mr. Schmidt dismissed a suggestion that despite the economic spinoffs of operating in Canada, an American company would get the greatest financial windfall. He said Canadians could innovate equally with Sidewalk data: “We’re stronger when there’s a local competitor.”
Josh O’Kane