Mr. Chair, honourable members of the committee, thank you for the opportunity to contribute to your study on the commercialization of intellectual property.
I am Jim Balsillie, chair of the Council of Canadian Innovators and also of Canada's Innovation Asset Collective.
As this committee well knows, Canada has directed tens of billions of dollars to build capacity in science and research. These investments have propelled our universities into the top global rankings for academic publications and for education. What is missing is a focus on the ownership of ideas, which is a precondition to commercialization.
Simply put, you cannot commercialize ideas you don't own. Canada has never paid serious attention to IP ownership. Repeated initiatives aimed at promoting economic growth either ignored the ownership prerogative altogether or were designed to transfer decades' worth of publicly funded research to foreign firms.
Today the knowledge-based economy is in its fourth decade, the data-driven economy is in its second decade, and the age of machine learning capital is emerging, yet Canada's deficit on IP payments and receipts is widening at an alarming pace, a position we now share with developing nations.
This is why the OECD recently projected that Canada's economy will be “the worst performing advanced economy over 2020-2030” and the three decades thereafter.
The arrival of the knowledge-based economy in the 1980s transformed a world previously based on knowledge sharing, open science and a patent system designed to reward genuine inventions into a world of closed science and the monopolization of knowledge and information. Over the past 30 years, we've seen a dramatic rise in IP ownership around the world, especially in critical technologies such as machine learning and clean tech.
Under current strategies, Canadians are contributing to the development of intangible assets but not sharing in the ownership or exploitation of these assets.
A small example of Canada's approach to IP commercialization is best embodied in the quotes I've provided to you from Google and Tesla.
In my appendix, I have included a chart that shows how technology firms organize their innovation activities, specifically by continuously monopolizing knowledge by owning the IP while outsourcing the innovation steps to unwitting firms and publicly funded research institutions. Simply put, Canada must start focusing on the ownership of IP if we want to improve our poor commercialization record.
A critical step is to build capacity inside our policy community for the contemporary economy, including how IP is generated and commercialized. In the short term, Canada can, one, invest in IP collectives, which are co-op-like structures that provide professional, centralized resources, including “freedom to operate” strategies, to Canadian companies.
Two, Canada can broaden the mandate of the Innovation Asset Collective, which is currently focused on only later-stage clean-tech companies.
Three, Canada can centralize commercialization expertise and services for Canadian universities, as Germany has done for the Fraunhofer Institutes. The Government of Ontario has recently created Intellectual Property Ontario, IPON, an agency that provides IP management alongside expert advice and services to companies and academic institutions. The federal government should do the same.
Four, Canada can experiment with publicly owned data trusts and collectives to protect public welfare and support domestic innovation in the data-driven economy.
Paying attention to the ownership of IP does not require material or new funding; it's about a reorientation of our current strategies, which overwhelmingly ignore IP ownership and thus create a system of IP philanthropy for foreign economies. Canada's history of research and education funding deserves better domestic economic outcomes.
Thank you.