Canada isn’t known for housing massive technology corporations like its southern neighbour. But is that for lack of innovation or rather laws that stifle company’s growth potential?
University of Ottawa law professor Michael Geist recently penned a piece titled “Why Isn’t YouTube Canadian?” It is based off his appearing before the Standing Committee on Industry, Science and Technology, which is conducting a study on the e-commerce market in Canada, in October. On his blog, Michael posted his opening remarks—which interestingly observe how laws have prevented Canadian-born companies from potentially becoming global giants.
His post first highlights the fact that Canadians are internet savvy and heavy web users, yet Canada doesn’t give birth to any of the internet titans like Google or Facebook—”the multinationals that employ thousands and generate billions in revenue have largely eluded us,” he writes. “The question is why?”
Michael, as a law professor, believes the primary reasons are “legal and policy failures.” Below are four (of many) American technology behemoths that Michael says could have been Canadian. Now, “could have” is vague and no one can say for certain that these companies would have experienced the same success that their U.S. counterparts ultimately did—but they were here first and they were moving in the right direction. That is, until our laws stopped them in their tracks.
YouTube could have been Canadian.
The company would have been called iCraveTV, a Toronto-based online video startup that launched in 1999. It streamed television programming online supported by advertising along the bottom of the screen. It was YouTube years before there was YouTube and it relied on Canadian law to do it. The U.S. objected and within months the service was shutdown and Canadian law changed as we caved to U.S. pressure.
Google could have been Canadian.
The company would have been called OpenText. OpenText is of course Canada’s largest software company based in Waterloo, but before Google was a Stanford graduate student project, OpenText was providing the search technology for companies like Yahoo. U.S. copyright law has a fair use provision that Google later relied upon to index the Web and become a multi-billion dollar company. Canada still has a more restrictive fair dealing approach and OpenText opted for managing content in the corporate market, which does not raise the same legal issues.
Facebook could have been Canadian.
The company would have been called Nexopia. Nexopia is an Edmonton based social network that is still active. It was founded in 2003, a year before the launch of Facebook. But unlike Facebook and thousands of other US companies, Canada does not have a rule that grants legal immunity to intermediaries for postings of third parties. In the U.S., CDA Section 230 has been used by all the giants – Facebook, Amazon, Google, eBay – to limit risk and liability for the postings of their users. In Canada, we do not have the same protections and the risks faced by anyone operating online is far greater.
Michael also mentions Skype, Zillow, and Amazon, among others. The point is, though, that “Canada has failed to build competitive legal and policy e-commerce frameworks and we are now living with the consequences.”
To see his solutions to this problem, visit his blog.