Transcript canada as innovation nation - Canadian IT Law Association

DOUBLING DOWN ON DIGITAL:
CANADA AS INNOVATION NATION
George S. Takach
McCarthy Tétrault
IT.CAN Annual Conference
October 2014
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“DOUBLE DOWN”
“Double Down”
Verb phrase:
(a) (in blackjack) to double an initial bet, on the condition that one can
be dealt only one more card:
“Will you double down and beat the dealer?”
(b)
to increase one’s efforts or hold to a position or opinion, especially
when vulnerable or taking a risk:
“He has continued to defend his controversial interpretation of the
document, doubling down on what he sees as the truth.”
Source: Dictionary.com
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WHY CANADA NEEDS TO DOUBLE
DOWN ON DIGITAL
 We are falling very far behind our key trading
partners
 Our digital deficit threatens our prosperity,
community and liberty
 What we have to do is raise our digital game,
by a factor of 2x
 And we need to do this NOW
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TIME IS OF THE ESSENCE





Agrarian revolution – 2,000 years to unfold
Industrial revolution – 200 years
Computing revolution – 40 years
Internet – 20 years
SMAC (Social, Mobile, Analytics, Cloud) - Now
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WHY DIGITAL INNOVATION MATTERS
 An example: from Encyclopedia Brittanica to Wikipedia
 Encyclopedia Brittanica
 65,000 articles (years between updates of content)
 100,000 sets sold a year
 $1,400 cost
 six weeks to deliver
 Wikipedia
 4,300,000 articles (content constantly updated)
 13,000,000 regular users
 essentially free (crowd sourced donation model)
 download in 0.001 second
 Wikipedia improvement over Encyclopedia Brittanica
 depending on metric, 8,600% to 3,600,000,000% (3.6 billion)
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DIGITAL INNOVATION WILL HELP US MEET
OUR BIGGEST CHALLENGES (1)
 Healthcare: our unique system of publicly funding healthcare is in deep
trouble (in some provinces like Ontario, it soaks up about half the
government budget, and that’s without including drugs, vision care, and a
range of wellness therapies); digital can play a significant role in
promoting the wellness of Canadians, and in reforming and improving
our healthcare system, while making it affordable over the mid to long
term.
 Education: educators in this country are tasked with solving so many of
our challenges, from: integrating hundreds of thousands of New
Canadians each year; preparing our teenagers for the world of work,
especially in the STEM (Science, Technology, Engineering, Math)
curriculum; fostering a civic culture that instills tolerance and mutual
respect; helping narrow the gap between rich and poor by providing a
common platform of opportunity; in all these ambitious endeavours,
digital will be a key driver for helping educators achieve these necessary
goals.
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DIGITAL INNOVATION WILL HELP US MEET
OUR BIGGEST CHALLENGES (2)
 Sustainability: Canada has always been a land of abundant natural
resources – years ago Harold Innis’ staple theory explained the model –
first fish, in the 1600’s, then trees, beaver pelts, minerals, wheat, and
today oil; and the development of natural resources has given the
country a fairly comfortable life style, but now it’s clear these industries,
together with our factories, smelters and oil fields, have to be developed
in a more sustainable manner – and digital will play an important role in
that.
 Civic Engagement: we have dangerously low rates of voter turnouts in
elections at all levels; if this trend keeps up, there will come a day when
the legitimacy of our democratic institutions will come into question;
digital can play an important role as a “political glue”, including by
enabling e-voting, and facilitating open data/open government initiatives.
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DIGITAL INNOVATION WILL HELP US MEET
OUR BIGGEST CHALLENGES (3)
 Productivity: relative to our key trading partners, our productivity in the
manufacturing of goods and the provision of services is lagging, and in
some sectors very badly; underinvestment in ICT and other digital
assets, technologies and techniques is a major cause of our poor
productivity growth.
 Manufacturing: one industry that is on virtual life support in this country
(and is only saved from time to time by reducing the value of our
currency, which of course hurts everyone else, and even manufacturers
by making their foreign sourced inputs more expensive) is
manufacturing; the good news is that digital, if implemented well, could
save this sector, by moving it up the value chain to “high tech
manufacturing”.
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DIGITAL INNOVATION WILL HELP US MEET
OUR BIGGEST CHALLENGES (4)
 Youth Unemployment: while the figure varies by region and urban centre,
generally youth unemployment is twice as high (about 15%) as the
general unemployment rate; add in under-employment, and the figure
jumps to about 28%; digitally oriented and enabled jobs – both in tech
companies, and throughout the economy more broadly - can bring a
good number of these young people high-paying, value-added,
interesting employment.
 Lifelong Training: for various reasons (mostly due to necessity), about
2/3 of people will continue to work after the age of 65; this older
workforce will require additional training, and often wholesale re-skilling;
the best hope for doing this is an ambitious infrastructure of digital
training, ideally part of a lifelong online training system, so that formal,
structured learning in fact never ends for Canadians.
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DIGITAL INNOVATION WILL HELP US MEET
OUR BIGGEST CHALLENGES (5)
 Digitizing Canadian Business: a tsunami of digital business models will
be hitting the Canadian economy between now and 2020; we are already
witnessing this next wave, with the likes of Uber (for consumer
transportation), Airbnb (temporary accommodation), Netflix (online
content) as simply three of the better known examples; we have to
ensure that Canadian businesses that are not yet with the digital
program (including about 50% of small and medium sized (SME)
businesses) get on quickly, and that the even larger companies that have
started up the digital ladder move higher much more quickly.
 Public Safety: we need credible digital skills, at scale, to allow us to
combat cyberwarfare and cybercrime, and generally ensure
cybersecurity; but always in a manner that protects Canadian civil rights
and liberties.
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CANADIANS AS DIGITAL CONSUMERS
Not a bad picture
 No. 1 in web-pages visited per month
 No. 1 per capita social networking users
 No. 2 in online screen consumption – 41.3 hours per month
 No. 2 in online video consumption
 75% smartphone penetration, higher than most other
countries (but, at end of 2012, Canada had 80 mobile
connections per 100 population, whereas 18 OECD
countries were at 100 or more!)
 80% of Canadians have reasonably fast broadband access
 80% e-banking adoption
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CANADA AS A DIGITAL PRODUCER?
 Not so much
 A good, but not great ICT capability
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CANADA’S ICT SECTOR
 ICT = Information and Communications Technologies
 ICT Manufacturing (computer and peripheral equipment
manufacturing; communications equipment)
 Software and Computer Services (software developers; data
processing)
 Communications Services (telecom services; cable and other
distribution)
 BUT, ICT is by no means Canada’s entire digital information
economy, where value generated by intangible information and
the efficient use of information (see Richard Florida’s “Creative
Class”)
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THE CANADIAN ICT SECTOR, 2011
 33,000 companies
 87% in software and computer services
 only 75 ICT companies with more than 500
employees
 28,300 companies (85%) with less than 10
employees
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CANADIAN ICT SECTOR REVENUES
 From $134 bn to $155 bn from 2007 to 2011
 2011 growth 3.2% over 2010 (economy
generally was 2.6%)
 Growth of ICT sector between 2007 and 2011
was 1.6% (economy generally was .9%), over
a very challenging period (i.e.- the Great
Recession)
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CANADIAN ICT WORKFORCE
 500,000 Canadians in ICT sector
 3% of total employment
 45% of ICT workers have university degree
(generally in the labour market, 26%)
 average annual earnings 50% higher in ICT:
$68,231 (and software $71,533) relative to all
Canadian industries at $45,488
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ICT and R&D
 ICT is largest private sector contributor to
R&D, at $4.8 bn in 2011
 Comprises 30% of all private sector R&D
expenditure in Canada
 BUT …
(the following screens contain disturbing
metrics – close viewer attention is required)
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CANADA’S DIGITAL DEFICIT (1)
 Leading digital countries have about 8% of the
workforce in ICT – roughly 2 x that of Canada
 45% of Canadian business, especially SME’s,
still not meaningfully online
 Only 3% of Canadian retail economy is online:
UK (23%); US (7%) – result, 68% of
Canadians shopping online buy from nonCanadian e-tailers
 Hence, the need to “double” down
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CANADA’S DIGITAL DEFICIT (2)
 Internet activity contributes only 10% GDP growth in
Canada: Sweden (33%); UK, Germany (25%)
 Canada underinvested in R&D, including ICT
investment, by about 50%
 Between 1980-2011, Canada experienced zero growth
in innovation-related productivity improvement
 Most Canadian tech/Internet businesses too small, far
too timid
 Hence, the need to “double” our efforts, our
investments, our results
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CANADA’S DIGITAL DEFICIT (3)
 World Economic Forum ranks Canada 24th on
Internet usage index, comprising broadband
subscriptions, innovate capacity of business,
and degree of government adoption of online
service delivery
 Canada 22nd in International Technology
Union’s international ICT Development Index
 Again, the need to improve our performance
by a factor of 2x
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CANADA’S INNOVATION DEFICIT
 We are not yet a truly “Innovation Nation”
 The following metrics are also very troubling
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HOW WE RANK IN INNOVATION
 R&D as a % of GDP (1)
 Top Tier
Country
Top Tier (greater than 2%)
South Korea
Israel
Japan
Finland
Sweden
Denmark
Germany
Austria
Slovenia
United States
France
Belgium
Estonia
Netherlands
Singapore
Iceland
2009
2010
2011
3.56
4.17
3.36
3.94
3.62
3.16
2.82
2.71
1.86
2.82
2.27
2.03
1.41
1.82
2.20
2.82
3.74
3.97
3.25
3.90
3.39
3.00
2.80
2.80
2.11
2.74
2.24
2.10
1.62
1.86
2.05
4.04
3.97
3.39
3.80
3.39
2.98
2.89
2.77
2.47
2.76
2.25
2.21
2.37
2.03
2.23
2.60
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3.93
3.55
3.41
2.98
2.92
2.84
2.80
2.79
2.26
2.24
2.18
2.16
2.10
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HOW WE RANK IN INNOVATION
 R&D as a % of GDP (2)
 Mid Tier
Country
2009
Mid-Tier (between 1 and 2%)
China
1.70
Czech Republic
1.35
Canada
1.97
United Kingdom
1.82
Ireland
1.69
Norway
1.76
Portugal
1.64
Luxembourg
1.74
Spain
1.39
Hungary
1.17
Italy
1.26
Russian Federation
1.25
New Zealand
1.28
Brazil
1.17
Malaysia
1.01
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2010
2011
2012
1.76
1.40
1.86
1.77
1.69
1.68
1.59
1.51
1.40
1.17
1.26
1.13
1.84
1.64
1.79
1.78
1.66
1.65
1.52
1.41
1.36
1.22
1.25
1.09
1.27
1.21
1.07
1.98
1.88
1.73
1.72
1.72
1.65
1.50
1.44
1.30
1.30
1.27
1.12
1.16
1.07
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HOW WE RANK IN INNOVATION
 R&D as a % of GDP (3)
 Bottom Tier
Country
2009
Bottom Tier (below 1%)
Serbia
0.92
Lithuania
0.84
Poland
0.67
Malta
0.54
Slovak Republic
0.48
Croatia
0.85
Latvia
0.46
Bulgaria
0.53
Romania
0.47
Turkey
0.85
Ukraine
0.86
Argentina
0.60
Mexico
0.43
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2010
2011
2012
0.79
0.80
0.74
0.68
0.63
0.75
0.60
0.60
0.46
0.84
0.83
0.62
0.46
0.78
0.92
0.76
0.72
0.68
0.76
0.70
0.57
0.50
0.86
0.74
0.65
0.43
0.99
0.90
0.90
0.84
0.82
0.75
0.66
0.64
0.49
25
BUSINESS ENTERPRISE EXPENDITURE ON R&D
(BERD)
 BERD as % of GDP, and ICT Share of total BERD
 Top tier
Country
Finland
BERD as % of
GDP
1.7
ICT BERD as % of
Total BERD
58
Taiwan
1.5
74
Korea
1.5
53
Israel
1.1
33
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BUSINESS ENTERPRISE EXPENDITURE ON R&D
(BERD) (2)
 Mid Tier
Country
Sweden
US
Japan
Singapore
Ireland
Denmark
Switzerland
France
BERD as % of
GDP
.75
.70
.60
.40
.40
.30
.30
.30
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ICT BERD as % of
Total BERD
30
33
21
36
32
20
13
21
27
BUSINESS ENTERPRISE EXPENDITURE ON R&D
(BERD) (3)
 Bottom Tier
Country
Netherlands
Belgium
Austria
UK
Portugal
Canada
Norway
Germany
Australia
Spain
Italy
BERD as % of
GDP
.25
.25
.25
.25
.25
.20
.20
.20
1.25
1.25
1.25
Source: OECD, 2010
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ICT BERD as % of
Total BERD
26
18
13
21
30
21
23
9
10
17
18
28
WHO IS MAKING THE R&D SPENDING, 2013 (1)
 % of R&D spending by Private Sector, Higher Education, Government
 Top Tier
Country
Private Sector
Israel
Japan
Korea
China
Switzerland
Finland
Sweden
Ireland
80
77
77
75
73
70
70
70
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Higher
Education
13
13
10
8
24
20
26
26
Government
4
8
11
NA
.7
9
4
5
29
WHO IS MAKING THE R&D SPENDING, 2013 (2)
 % of R&D spending by Private Sector, Higher Education, Government
 Second Tier
Country
Private Sector
Higher
Education
Government
US
Austria
Denmark
Germany
Belgium
France
UK
Russia
68
68
67
67
67
63
61
61
15
28
30
18
23
21
27
9
12
5
2
15
9
14
9
30
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WHO IS MAKING THE R&D SPENDING, 2013 (3)
 % of R&D spending by Private Sector, Higher Education, Government
 Third Tier
Country
Private Sector
Australia
Italy
Spain
Norway
Canada
Netherlands
58
54
52
52
51
48
Source: OECD, 2013
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Higher
Education
26
29
28
31
38
40
Government
12
14
20
16
10
12
31
TOP 250 ICT COMPANIES BY COUNTRY OF ORIGIN, 2012
Country
Top Tier
US
Japan
Mid Tier
Taiwan
France
UK
Spain
Bottom Tier
Brazil
Netherlands
Canada
India
Sweden
Switzerland
Turkey
South Africa
Ireland
China
Belgium
No. of Firms
2011 Revenue
(millions)
Employment
82
49
1,637,517
855,404
4,084,060
2,910,346
18
10
8
3
315,478
195,291
152,008
100,961
1,789,186
621,402
373,806
301,359
7
6
6
4
3
2
3
3
3
3
2
68,477
88,062
65,832
39,398
47,928
20,168
17,750
21,849
42,811
49,942
12,950
80,488
255,039
193,500
498,140
137,031
73,129
54,627
48,437
311,191
417,785
27,442
Source: OECD, 2012
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THREE BIGGEST INTERNET COMPANIES IN EACH COUNTRY, 2014
-
Market value of the three biggest Internet companies
Rank
Top Tier
1.
Country
Combined Market Value
(in billions)
Companies
United States
China
$801
$417
Google, Facebook, Amazon
Alibaba, Tencent, Baido
3.
4.
Japan
South Africa
$88
$52
Yahoo Japan, Line, Rekten
Naspers, Yola, Mxit
5.
South Korea
$43
Naver, Nexon, NCsoft
Third Tier
6.
Russia
$26
Yandex, Mail Ru, VK
7.
Israel
$15
Check Point, Conduit, Wix
8.
Britain
$17
Asos, Rightmove, Just Cat
9.
10.
Germany
Sweden
$13
$12
Rocket Internet, Zaland, Big Point
KING, Spotify, Klanna
11.
12.
Australia
Finland
$9
$8
REA, AHarsion
Rovio, Supercall, Grand Cru Games
13.
Canada
$8
Opentext, Hootsuite, Shopify
14.
15.
Argentina
New Zealand
$7
$6
Mercadolibre, Despegar, Navent
Xero, Diligent
16.
Ireland
$6
Paddy Power, Fleetmetics, Hostel World
17.
France
$6
Critex, Vente Privee, Seboger
2.
Second Tier
Bottom Tier
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INNOVATION CULTURE (1)
 Nobel Prizes for Physics and Chemistry (362 individuals, 196 in physics,
and 166 in chemistry):
Country
%
No. of Winners
32
115
UK
12
43
Germany
10
35
French
4
15
Canada
2
7
Australia
1
3
South Korea
0
0
Top Tier
US
Mid Tier
Bottom Tier
Source: nobleprize.org
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INNOVATION CULTURE (2)
 Field Medal for math:
Country
%
No. of Winners
US
21
12
France
14
8
UK
9
5
Germany
7
4
Canada
2
1
Australia
2
1
Top Tier
Mid Tier
Bottom Tier
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COMPUTER TECHNOLOGY PATENT
APPLICATIONS, 2007-2011
Country of Origin
Top Tier
US
Japan
Number
231,206
160,422
Second Tier
Korea
China
Germany
60,955
45,047
26,702
Third Tier
France
Netherlands
Canada
Finland
Sweden
Switzerland
Australia
15,946
11,819
10,417
6,572
6,410
4,359
2,920
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PATENT APPLICATIONS BY $100 BN USD GDP, 2012
Country
Korea
Japan
China
Germany
Switzerland
Finland
US
Sweden
Denmark
Luxembourg
Belarus
Austria
Russia
New Zealand
France
Netherlands
UK
Ukraine
Italy
Belgium
10,584
7,160
4,980
2,596
2,575
2,090
1,988
1,722
1,667
1,414
1,410
1,348
1,339
1,251
1,248
1,213
972
854
760
730
- That’s right, Canada is not among the top 20 countries
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PATENT APPLICATIONS PER MILLION POPULATION, 2013
Country
Korea
Japan
Switzerland
Germany
US
Finland
Sweden
Denmark
Austria
Netherlands
China
France
North Korea
UK
Norway
Belgium
Russia
Singapore
Italy
Belarus
- Again, Canada not in the top 20
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2,962
2,250
1,013
902
856
665
605
539
489
444
396
372
337
318
312
238
203
203
200
189
EARLY STAGE FUNDING OF ICT
 ICT Investment as a % of total capital formation (OECD, 2010)
Top Tier
US
Second Tier
Sweden
Denmark
UK
Third Tier
New Zealand
Belgium
France
Fourth Tier
Netherlands
Canada
Finland
Fifth Tier
Australia
Spain
Japan
Ireland
Germany
Austria
33
25
25
24
22
21
20
18
17
15
14
14
14
13
13
13
 Again, need to double Canada’s efforts
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A CULTURE OF INNOVATION
 The irony of our digital deficit
 We have plenty of risk taking prospectors in
the natural resources space – especially junior
mining companies
 On tech and digital, a culture of risk tolerance
– let alone audacious risk taking - not yet
sufficiently developed
 And the opportunity is huge, at home and
especially abroad
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ICT LARGE AND GROWING GLOBAL MARKET
 ICT spending worldwide between 2003 and 2012 grew from $2.4 trillion
to $4.4 trillion
 ICT spending by country, 2012
Country
US
Japan
Germany
UK
France
Italy
Canada
Korea
Spain
Netherlands
Australia
US$ Trillions
1.2
.4
.25
.2
.17
.12
.11
.9
.76
.6
.6
 Double edge sword of huge US market: a great place to sell, but also
a huge magnet of Canadian talent
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GROWTH OPPORTUNITIES IN GLOBAL ICT
- Largest ICT spenders by growth (OECD, 2012):
India
China
Russia
Brazil
Australia
Canada
Spain
Netherlands
UK
France
Korea
Italy
Germany
US
Japan
Source: OECD, 2012
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22%
15
15
14
8
7
6
6
7
6
6
5
5
4
3
42
FASTEST ICT SPENDING GROWTH
 Growth in ICT spending between 2003-2012 (OECD,
2010):
 >25% - Nigeria; Bangladesh; Sri Lanka
 20-25% - Senegal; Iran; Zimbabwe; Morocco;
Indonesia; India
 15-20% - Romania; Egypt; Cameroon; VietNam;
Venezuela; Philippines; Saudi Arabia; Ecuador; Slovak
Republic; Russia; China
 Canada’s multicultural make up as a comparative
advantage in accessing these markets
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IT’S NOT JUST STEM
 It’s also about digitizing every aspect of how we do
business, education, government, etc.
 A low tech, but very digital example: Mabel’s Labels
 Virtually all sales of this kids (and now broader) label
maker driven by Internet-based marketing, including
social media.
 Over 40 staff, 40,000 sq. ft. plant in Hamilton
 A solid performance, and a role model for Canada’s
digital deficient SME sector
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HOW TO DOUBLE DOWN ON DIGITAL
 How to ensure more – and even bigger –
Mabel’s Labels
 The solution has many moving parts
 No single silver bullet
 It’s some specifics … but it’s also culture, selfperception
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SELF PERCEPTION MATTERS (1)
"A few years ago I landed at Stockholm`s Arlanda airport (I was with
the M&A acquisition team of a Canadian tech company; we were in
Sweden to buy a Swedish tech business). In the 10 minute walk
from the airplane to immigration control, I was impressed by the
large images on both sides of the walls of the airport corridor of the
great and good of Swedish industry, culture and sports. By the time I
got to the passport control official, I was totally blown away by how
successful this small country of 8 or so million people has been over
the last century, especially in terms of contributions to the global
economy (Volvo, IKEA, Saab, Ericsson, all highlighted in the
images). My previous view of Swedes as largely egalitarian, healthy
outdoors, crunchy granola people was superseded by a sense of
them as smart, driven, savvy business people.”
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SELF PERCEPTION MATTERS (2)
“When you arrive at Toronto`s Pearson airport, and walk the same
sort of route to the exit of the airport, there is no pantheon to
Canada's impressive history makers (industrial, cultural or
otherwise). Rather, just before you leave the building, there`s a
video of a bush plane landing on a lake, with a backdrop of trees and
rocks. As pretty as the video is, it unfortunately reinforces the
stereotype of Canadians as hewers of wood and drawers of water;
unlike the impression one gets walking the same type of corridor in
Sweden‘s principal airport, which shouts knowledgable, creative
citizens who have left their imprint on the world.
Self-perception matters (as do the first impressions of a country left
on arriving foreigners!). Toronto's airport, and Canada more broadly,
needs to update its branding, to reflect a new, vibrant country.”
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THE KEY TO DIGITAL SUCCESS
 Canada needs to develop top tier management talent
that can build success for enterprises on a global
scale
 Strong STEM capability
 Global management experience
 Livable cities to attract and retain top talent; for
example, must solve gridlock in GTA (15 million
people by 2040)
 And an appetite for swinging for the fences – for
doubling down
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DOUBLING DOWN ON DIGITAL
EDUCATION
 Start in primary school, not only kids as consumers of digital, but
as producers
 Junior Achievement example in Saskatoon – coaching aboriginal
youth on app development – lighting an entrepreneurial spark
 In high school, more emphasis on successfully teaching STEM
(Science, Technology, Engineering and Math), but not to the
exclusion of humanities, social sciences
 In high school, also teach entrepreneurialism – it can be done
 And the role models are not just business entrepreneurs, but
social innovators as well, especially those in the social sector who
are using digital tools, channels and methods with success
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BUILDING COMMUNITY THROUGH
DIGITAL
 Need to address the digital divide, both in terms of
income disparity (lower technology adoption rates in
lower income households), geographic distance
(rural adoption rates are lower/more expensive) and
age disparity (many seniors are not yet connected)
 A major role for high school students to gain their
required community hours through digital outreach
with these three communities
 Importance of wired digital libraries in bridging these
gaps
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POST SECONDARY EDUCATION
 Curriculum delivery through sophisticated digital
platforms – the medium is the message
 Digital co-ops, but not just engineering and code
development, but the broad range of effort required to
digitize businesses, governments, other public sector
organizations, not-for-profits, etc.
 University/college connections with incubators,
accelerators, and early stage tech company financing
eco-systems
 Every school needs a Digital Media Zone; and not just
for techies, but for sparking/enabling new business
models where tech is just a support
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THE EDUCATION IMPERATIVE FOR
DIGITAL
 Only 20% of Canadian degrees are in STEM – low
relative to countries with a science culture
 Create a science culture, even among non-STEM
students and alumni
 Develop capable business people who are not afraid
to swing for the fences
 University/colleges should give inventors
unencumbered ownership of resulting intellectual
property
 De-stigmatize business failure (bankruptcy is just
another year of learning)
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GOVERNMENT FINANCIAL SUPPORT
 Government should not try to pick winners
 R&D tax credit should be neutral; all qualifying
effort should be eligible for the tax credit
 Proposal: - a digital renovation tax credit,
especially for SME’s
 Proposal: - flow through shares
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THE PATENT IMPERATIVE
 Patents are the thermonuclear weapons of the
digital era
 It will be very difficult for Canadian tech
companies to succeed in foreign markets –
especially the huge US market – without their own
patents
 Need to raise awareness in post-secondary
education
 Patent clinics for early stage tech entrepreneurs
 Focussed government support for patents
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DOUBLING DOWN ON PUBLIC
FINANCIAL ASSISTANCE
 Currently, annually about $1.5 billion for ICT SRED, and
over five years $200 mn for SME digital adoption; $300 mn
for venture capital for ICT; and $100 mn for accelerators
 On a federal budget of around $280 bn, this $2 bn a year is
a very low figure
 One single, major energy project can easily run $10-12
billion; lots of government assistance extended to the
energy sector, and the non-ICT sector – ICT needs to be
given its fair share
 Goal – double federal assistance to $4 bn a year, right
away
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SMART REGULATION FOR DIGITAL (1)
 Government needs to build trust in our digital world,
not mistrust
 Warrantless searches of non-public information by
public authorities must end. Period.
 The process of judicial oversight of lawful access must
be reviewed, and improved (judicially approved lawful
access should become as quick and agile as that of
the cybercriminals)
 Public oversight of intelligence data gathering must be
improved
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SMART REGULATION FOR DIGITAL (2)
 Kudos to e-commerce statutes:
 minimalist, but very effective
 technology neutral
 Canadian regulations synchronized with global initiative
 Supports and enhances online activity, in a measured and
responsible manner
 CASL as poor example of regulation for digital:
 vastly intrusive (not minimalist)
 overly complex
 out of step with approach taken by key trading partners
 dampens economic activity unnecessarily
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FUTURE REGULATORY CHALLENGES
 Regulation must protect competition, not competitors
 The salutory role of disruptive technologies
 payment systems
 virtual currencies
 Uber
 Airbnb
 International standards on privacy (i.e.- data “closets”);
these fast becoming trade barriers
 The role for government in addressing cybersecurity,
cyberwarfare, and cybercrime
 The need to act globally
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George S. Takach (1)
George is a senior partner at the McCarthy Tétrault law firm. George brings significant value to clients in
their tech company M&A/financing deals, their sophisticated tech licensing, IT procurement and other
tech commercial transactions, and their more challenging e-commerce activities, including projects
involving cloud computing, big data and social media.
George’s deep experience in tech M&A/financing allows his clients to get deals done more quickly and
cost effectively. Past deals where he has brought his value-added skill set to clients include:
•
IPO and multiple acquisition transactions for Constellation Software Inc.;
•
multiple acquisition transactions for Aastra Technologies Inc., including purchase of Telepo, and
purchases from Ericsson, Nortel, EADS, DeTeWe and Ascom; merger transaction between Aastra
and Mitel;
•
multiple sale transactions acting for private Canadian technology companies being sold to multinational public tech companies, including: Optical Systems Group, Inc. to Ocuco Ltd.; CPAS
Systems to Xerox; Kobo Inc. to Rakuten Inc.; Kanetix Ltd. to Monitor Clipper Partners; Opalis
Software to Microsoft; Cybermation Inc. to CA Inc.; Chantry Networks to Siemens; InSystems to
Standard Register; Jewelstone Systems to AGF; and Rockwell Automation acquiring Rutter Hinz;
•
venture and related-type financings of earlier stage Canadian tech companies, including Kobo Inc.,
Fresco Microchip (Celtic House, Ventures West); CPAS Systems (Tier Technologies); Cube Route
(CIBC);
•
a range of other M&A/financing transactions involving technology companies and tech-related
assets, including: acquisition by Exact Software of Longview Solutions; acquisition by Kobo of
Aquafadas; and sale by Scotiabank of its fixed income indices business to TSX Group.
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George S. Takach (2)
In the area of sophisticated tech licensing, IT procurement and other tech commercial deals, George’s creativity
and broad experience allows clients to resolve difficult issues more quickly and to get the relationship off on the
right foot. In the tech commercial area, George has a national practice with the following illustrative clients whom
he has assisted with a broad range of agreements:
•
a Montréal-based bank;
•
an Atlantic Canada insurance company;
•
a Calgary-based energy company;
•
a Toronto-based retailer;
•
three Toronto-based banks;
•
a Montréal-based communications company;
•
a Toronto-based public sector agency; and
•
a public sector consortium with members in BC, Alberta, Ontario and Quebec.
George helps clients craft sensible and workable solutions to complex e-commerce-related legal and compliance
challenges. He brings a steady and experienced hand to bear on the invariably unprecedented legal issues
generated by novel e-commerce business processes. In the e-commerce/Internet law area, his extensive practice
includes:
•
advising companies on how to create legally compliant online customer experiences, including enforceable
“click consent agreements,” workable electronic voting processes, etc.;
•
advising governments on law reform initiatives aimed at facilitating e-commerce;
•
helping organizations comply with privacy and data protection laws; and
•
crafting and negotiating co-branding, Web-linking and other e-commerce-related agreements.
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George S. Takach (3)
George is the author of three books: Computer Law, second edition; The Software Business, second
edition; and Contracting for Computers, fourth edition. For 20 years he was an Adjunct Professor at
Osgoode Hall Law School, York University, where he taught an evening course in Computer Law. George
is in demand as a speaker to legal and technology industry audiences and a regular writer on legal
technology topics.
George is listed in the 2014 edition of Chambers Global: The World’s Leading Lawyers for Business, as
the only “Eminent Practitioner” in the area of information technology for Canada. Since its inception (and
most recently in 2014), George has appeared in the LEXPERT/The American Lawyer Guide to the
Leading 500 Lawyers in Canada, as a leading lawyer in the areas of technology and corporate midmarket. George is recognized in The Best Lawyers in Canada as a leading lawyer in information
technology law and technology law. Since its inception in 1997, he has been listed in the Canadian Legal
Lexpert Directory, a guide to the leading law firms and practitioners in Canada, as a leading lawyer in the
areas of technology and computer & I.T. law.
George received his BA and his JD (Dean’s Honour List) from the University of Toronto. He also has his
MA in international relations from the Norman Paterson School of International Affairs, Carleton University
in Ottawa. He was called to the Ontario bar in 1985. George has been on the Board of, and continues to
raise money for, Lake Scugog Camp, an organization serving underprivileged and “at risk” children/youth
and their families (a camp that George attended when he was a child).
George S. Takach
[email protected]
416 601-7662
McCarthy Tétrault – www.mccarthy.ca
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