Information & Ethics Committee on Oct. 4th, 2018

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you. This has been a fascinating discussion. Again, I have to confess I'm a former digital idealist. I thought Google were the most wonderful people on the planet. They used to wine and dine me because they were young upstarts and we needed an innovation economy. That was 2007. Since 2015, we feel like the world has completely disintegrated around our feet in terms of what we thought we knew, politically, with the power of these technology giants. This Cambridge Analytica scandal has opened our eyes on how we need to put more focus on this.

I think the idea of this smart city is a fascinating example, because we're talking about public spaces and the right of citizens to travel in a public space and also to have private lives. Suddenly, it's a really cool idea to turn that over to a private company with enormous and unprecedented international power, without scrutiny.

Eric Schmidt, from Google, said he's over the moon with the government's deal, because he said they finally got their wish for someone to give them a city and put them in charge. Then he said that the application, the project, might require substantial forbearances from existing laws and regulations.

Ms. Wylie, number one, has Google earned that trust? Number two, why should we give them any forbearance from existing laws and regulations?

[Bianca Wylie]

Absolutely not, and we should not.

[Charlie Angus, NDP, Timmins—James Bay, ON]

It's that simple.

[Bianca Wylie]

Yes.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Okay.

One of the outstanding issues with this deal is the ownership of the IP and the data. Again, we've said in Canada that we want to be an innovative economy and data is the new oil, but that agreement doesn't have any guarantee as to who owns the data. Is that something that needs to be examined before we go into any further details with this agreement with Google?

[Bianca Wylie]

Yes, it does.

Just to expand a bit, this is not one data that I'm holding here. I understand that we like to talk about data because it helps us get a handle on what we're talking about, but we need to realize how far down the road some of these companies are with the technologies that they're developing. When you start to hear corporations saying that they're going to open all the data too, so don't worry, you start to think that maybe it's not just the data. Maybe it's the usage. Maybe it's the data mixed with other things.

This is why we really need to start thinking about this. This data is a primary input to our knowledge about ourselves and how that plays out in policy. We cannot lose access to it. I know this gets dystopian, but if you stop understanding whether what someone is telling you is a pattern or is a fact, that is very dangerous, and that is what this blending idea is potentially leading to. We need to keep control of data, products, IP and everything that we're going to be using.

I'll end on why this is a smart city topic. This is the governance of a neighbourhood. This is part of a city. We're not doing corporate governance in Canada by accident or because we wanted to do something innovative.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Professor, I'd like to bring you into this discussion about what they're planning in downtown Toronto.

My grandfathers were miners and they didn't have much education, but they swore that they would never live in a company house. They would never shop at a company store. The mining communities fought like hell to have independence from the company, yet we're being told that it's going to be amazing to build a company-run city and that it will be all in our favour.

Some of the stuff that Google, or Alphabet, is offering is that it's going to have innovative transportation like Uber, Lyft and self-driving cars, as well as cloud-enabled smart sensors. Alphabet has an interest already in self-driving cars through its Waymo subsidiary. It has a financial stake in both Uber and Lyft through two VC funds. It has unit building sensors like Nest. It has its own cloud platform.

Are we basically saying to Google, to Alphabet, “Come in. Set up all your products that will benefit you, and our citizens will like it or lump it. If they're going to live there, they're going to live in the Google company town”? What does that mean from a social perspective and an economic perspective, and does there need to be a serious antitrust provision put in if we're going to deal with these kinds of projects?

[Prof. Maurice Stucke]

One of the things that Google, among others, has argued is that data is non-rivalrous. Basically what that means is that other people can use data and it doesn't really devalue the data itself. Google has argued that this is why it doesn't have any market power.

I think that's no longer its position, but it is true that multiple entities can use data and derive value from data. One concern then is that if one entity then hoards that data, it's not shared with others who can derive benefits from it. That's one concern.

The other concern is this. Let's go back to this sort of frenemy dynamic. I remember when we were writing our book, Virtual Competition, and Uber's concerns were with the local taxi commissions. Its concern was how it could get itself into the various cities, but we pointed out that one of the overarching concerns was that, to survive, it had to be on a smart phone platform. There are two: there's Apple and then there's Android. What Uber needs to exist, its oxygen supply, is basically controlled on this platform. Then you can see that if the platform is starting to go into, let's say, the mapping technology and also the self-driving technology, eventually there can be a collision. When there is a collision such as that, the powerful platform then will promote its interest and not necessarily the interests of others with whom it competes on the platform.

That could be another concern. If you have now this platform and have all this data, this platform can then promote innovation but innovation that, for example, is complementary with its current products and the like. What are then the [Technical difficulty—Editor] companies that compete against the platform? How are they going to be able to survive? Then the concern is how the platform can tailor it in such a way to promote its interests and hinder the interests of, let's say, technologies that might pose a threat to its business model.

When I mentioned Disconnect earlier, there was a privacy app that was going to help us reduce tracking. Google kicked it out of its app store. When we presented our research, someone in the audience had a really good quote that said that in trying to promote privacy, Disconnect is like inviting an arsonist into one's home. That's the perception—that anything that might be a threat to this data-opoly could then be kicked off. That could have a significant chilling effect on innovation, so that's a risk that needs to be taken into account.

[The Chair, Conservative, Bob Zimmer]

Thank you, Mr. Angus.

Next up is Ms. Vandenbeld for seven minutes.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

Thank you very much, both of you, for being here.

My first question is for Ms. Wylie.

You mentioned in your remarks that we should not go fast, that we need to consider this, that we can't just react. Now a lot of what we've heard is that this is something that is moving very quickly. We're already very much behind in terms of responding as a government. Can you talk a little bit about, first of all, what you mean by not going fast? Also, is there a danger in not moving quickly?

[Bianca Wylie]

This is informed by the fact that I have the Sidewalk Toronto project in my neighbourhood. Can you imagine that after a year of these kinds of concerns on the clarity—nobody understands what this project even is—it would still be going forward?

What would be sensible would be to shut it down and retender it. There's no rush for this. You have to look at these places where you say, “This is clearly very complicated. It's going fast and we're not getting the information we need to make decisions as a public about it”. That one is an example.

In other places, I think it's pretty clear. Maybe think about it as staunching serious bleeding but leaving a lot of room for what else to do.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

Thank you very much, because I know that there is the GDPR legislation, for instance, and I know there is a sense of urgency for Canada to do something similar to that.

If I'm understanding you correctly, it is on the things that we already know, and where there's precedent and maybe examples internationally, that we should be moving quickly. But on the areas where even technologists don't understand it, as I think you said, those are the areas where we really need to take our time and understand before we legislate.

[Bianca Wylie]

Absolutely, and to say you have these things.... Let's say you have GDPR. Maybe six months ago everybody told me only good things about GDPR. In the last six months, I've had conversations about where there might be some challenges and where we can do better.

Look at what's working for sure and then also consider where we might be able to do better.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

Can you elaborate on that?

[Bianca Wylie]

Certainly. In terms of being clear, I think one of the things that this need to act does to people is that then everybody leaves everything too ambiguous. When you leave things ambiguous, it's not good for.... If I'm a company and it's not clear to me what is legal or what is the direction, you're basically ramping up concern that you don't know how to interpret something.

It might let you legislate quickly, but then you're shoving the burden of not really being specific onto people who are going to feel those implications. This is across the board. You have to think about everybody who's going to have to deal with that. I think that's a major one: to be clear.

Also, it's the same as in my initial answer around contracts between people and the companies. Again, we need more clarity. We need to push these sorts of improvements into places where people feel it, where people have the confidence that this is getting better. We also need to be exploring those things at the same time.

I think those are two very clear opportunities.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

What are the things that you think we're now seeing with GDPR and that, as you said, you would be a little bit cautious about?

[Bianca Wylie]

It's just lack of clarity.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

Okay. The ambiguity you're talking about is in relation to that.

[Bianca Wylie]

Yes.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

I'd like to ask our other witness the same question.

What do you think of GDPR and the urgency with which we should act?

[Prof. Maurice Stucke]

One important thing is that privacy is only one component. There's also market power. Even if you have GDPR, you're not necessarily going to address all the risks involving these data-opolies. That's number one.

Number two, to follow up on Bianca, is that there is some uncertainty, for example, when it's necessary to get the data in order for the provider to provide you the service. Greater clarity on that would be helpful.

Third, there are some measures in the GDPR that look hopeful—such as data portability—and can address some of the competition concerns, but one thing to consider is that data portability may not necessarily be helpful when the velocity of the data is at stake. Here's a good example: mapping apps. You can port your data for Google Maps, let's say, but that's not going to be helpful to a navigation app that needs to know where you are at this very moment. The fact that you can port data from six months ago is not going to help that new navigation app compete against Waze, which Google owns, and Google Maps.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

Thank you.

In terms of jurisdiction, this question is for you, Mr. Stucke. A lot of these large, what you call data-opolies are based in the U.S. In terms of our being able to legislate, to what extent can Canada legislate on our own when we have these platforms that are not necessarily based here in Canada?

[Prof. Maurice Stucke]

I believe Canada could currently prosecute a price-fixing cartel in the United States that was harming Canadian citizens. Under that logic then, if there are anti-competitive harms that are affecting citizens of your jurisdiction, you could reach out, just as the United States, I believe, did with the uranium cartels and prosecuted those.

There are issues of comity and the like that need to be taken into account but, no, now you're looking at the Australians with the ACCC. They're looking at these digital platforms and the impact they have on news. There is a very important study that is going to come out from them. The Germans, the Bundeskartellamt is looking at Facebook. You have the European Commission looking at Amazon and how it's using data to perhaps favour itself.

We live in a global economy, and if companies in one jurisdiction are harming citizens in another jurisdiction, then just as the United States can prosecute those cartels, so too can another jurisdiction prosecute anti-competitive behaviour in our jurisdiction.

[Anita Vandenbeld, Liberal, Ottawa West—Nepean, ON]

Thank you.

My next question is for Ms. Wylie.

We're looking at the risks here. You mentioned in your remarks that there are also a lot of opportunities. Could you elaborate on the opportunities?

[Bianca Wylie]

Certainly.

This will tie in and build off of this.

I think one thing to remember for the Canadian context is that the fact that we have the Privacy Act and PIPEDA helps us to delineate using data within government versus in private. I don't want us to start losing track of that difference. A consumer is one thing and a resident citizen is another thing. I think we need to hold onto that delineation, perhaps, when we imagine what's next.

That's where I'm going to say the opportunity is as well. There are opportunities. Again, I keep coming back to the smart city context. We cannot lose control of stuff that is input to policy. To say in procurement that, if it's data related to these things, that ownership should fall to a city or to the country.... If these are inputs, these are things you can update in procurement, rather than trying to manage this all through privacy. I cannot agree enough. There are so many things here that go outside of privacy.

In terms of controlling inputs and then using data in our government better, there is lots of opportunity there—ample opportunity there—and it means we have to make sure it doesn't get privatized.