The Ever-Present Need for Canada’s ‘Digital Economy Strategy’

The 2013 Speech from the Throne seems like a distant memory. Ongoing allegations and revelations emanating from Canada’s Senate chamber have all but overshadowed the Government’s agenda, which Governor General David Johnston dutifully delivered to Canadians on 16 October 2013. Canadians who are eagerly awaiting the Government’s plans for moving the country forward in a ‘global digital economy’ can be further forgiven for forgetting about this text. The Government’s plan for “Seizing Canada’s Moment: Prosperity and Opportunity in an Uncertain World” has little to say about the country’s long-awaited Digital Economy Strategy.

In May of 2010, the Government of Canada launched a nation-wide consultation to gather ideas for moving Canada forward in the ever-evolving digital environment. It has now been over three years since this consultation closed and the implementation of these recommendations has yet to occur. As recently as 28 August 2012, then-Industry Minister Christian Paradis announced that he would “launch a Canadian-made digital economy strategy by the end of the year.”

As 2013 draws to a close Canadians as well as foreign investors interested in accessing and contributing to the Canadian market continue to wait.

Crafting a comprehensive strategy for capitalizing on the promises offered by digital technologies and network connectivity is a difficult task. This broad area overlaps a number of related and divergent areas including telecommunications, broadcasting, cultural heritage, international trade as well as various industry and economic concerns. However, a strategy for coordinating digital activities across these various areas is an important step for signalling to Canadians and the world that the country is looking and planning for the economic realities of the future.

Measuring and demonstrating direct causation between digital technologies and growth remains a challenge. However, international organizations and market analysts are increasingly recognizing the importance of the Internet and digital media for economic and human development. The Organization for Economic Cooperation and Development (OECD) has found that we “should expect that in the long term, the development of the Internet boosts knowledge creation and enhances per capita income growth across the economy” (p. 23).

Similarly, in their 2011 report “Internet matters: The Net’s sweeping impact on growth, jobs, and prosperity”, the McKinsey Global Institute found that the Internet’s worldwide economic impact, in terms of gross domestic product (GDP), is larger than Canada’s GDP (p. 2). The report finds that over the past five years the Internet has contributed to 21% of GDP in ‘mature’ countries and places Canada at the average level (10%) for domestic contributions to GDP (p. 16).

Countries, albeit those with larger overall economies, that have already developed strategies to benefit from digital activities — such as the United States and the United Kingdom (where the Internet contributes 15% and 23% to their GDPs, respectively) — are doing comparatively better at capturing growth advantages. However, the McKinsey Global Institute also noted that Canada has a great deal of Internet usage that can be leveraged to increase the country’s presence and benefits in the global supply ecosystem (p. 4). Formalizing a Canadian Digital Economy Strategy will assist in this respect.

Despite its absence from the recent Speech from the Throne, I think there is room for optimism about the future of Canada’s Digital Economy Strategy. This past summer Prime Minister Stephen Harper shuffled his Cabinet and named the Honourable James Moore as the new Minister of Industry. Minister Moore is widely regarded as one of the Governments most effective communicators and skilled operatives at moving policy forward. In his previous position as the Minister of Canadian Heritage, Moore helped move the country’s long-awaited reforms to the Copyright Act forward.

Doing the same thing with the Digital Economy Strategy may prove just as challenging. The five areas outlined during the consultation process—‘Capacity to Innovate Using Digital Technologies’, ‘Building a World-Class Digital Infrastructure’, ‘Growing the Information and Communications Technology Industry’, ‘Digital Media: Creating Canada’s Digital Content Advantage’, ‘Building Digital Skills for Tomorrow’—are diverse and cut across a number of industries, policy areas and government departments.

Calibrating these economic, innovation, cultural, heritage, social, and intellectual property (IP) concerns will take political skill and the resolve to advance policy-oriented solutions. In my opinion, one of these areas will be comparatively easy, as Canada’s IP policies are largely set for the foreseeable future. The Copyright Modernization Act and Bill C-8 (previously known as Bill C-56),  the ‘Combating Counterfeit Products Act‘, purportedly aims to align Canada’s laws and priorities with its international trading partners. (Past IPilogue coverage on Bill C-8/C-56 can be found here and here.) A Canadian Digital Economy Strategy will need to take these priorities into account and position the country’s industries and citizens to take advantage of digital opportunities.

The intersection of IP and technology law with a number of other policy areas requires a principled framework for fostering Canada’s digital advantage. Minister Moore and those involved in this process should work to ensure that such a strategy fosters access to digital technologies and content, the ability to use these resources in innovative ways, and that it provides legal mechanisms that entrench the security and privacy necessary to legally use, develop, and exploit digital resources for economic and human development.

In my opinion, successfully steering this ship to port will help define Moore’s time as the Minister of Industry and may also set him up nicely for any future endeavours he undertakes.

Joseph F. Turcotte is an IPilogue Editor, a PhD Candidate and SSHRC Doctoral Fellow in the Communication & Culture Program (Politics & Policy) at York University, and a Nathanson Graduate Fellow at the Jack & Mae Nathanson Centre on Transnational Human Rights, Crime and Security at Osgoode Hall Law School.

One Comment
  1. The blog rightly suggests that implementing a unified strategy through different pieces of legislation with different stakeholders and policy concerns is no easy task. Failure to align priorities sends an inconsistent policy message and results in improper incentives. Canada’s upcoming Anti-Spam Legislation (CASL) and the proposed amendments to the Personal Information and Electronic Documents Act (PIPEDA) in Bill C-475 exemplify this problem.

    Since PIPEDA governs all collection, use and disclosure of personal information in the private sector, it regulates nearly all online commercial activity. But despite its importance to the future of digital economy, PIPEDA does not impose meaningful penalties for contravention. Amendments proposed in Bill C-475 to address this issue are fairly modest: e.g., the maximum penalty for failing to comply with the federal Privacy Commissioner’s orders is $500,000.

    In contrast to PIPEDA’s broad applicability, CASL regulates very specific elements of online commercial activity, such as unwanted spam email and installation of computer programs. The proposed maximum penalty for sending offending spam is $1,000,000 for individuals and $10,000,000 for organizations.

    The disparity in penalty between CASL and PIPEDA is puzzling and sends an inconsistent message about priorities by failing to incentivize behaviour that will have the most impact on how Canadians take advantage of new technologies. Why companies should have more financial incentive to adjust their e-mail communication practices than to invest in PIPEDA compliance is not easily understandable.

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