TPP exposing Canada’s innovation weak link: Balsillie

OTTAWA — The Trans-Pacific Partnership (TPP) is a raw deal for Canadians who deal in intellectual property because the country has never developed a proper innovation strategy, according to Jim Balsillie, former co-CEO of BlackBerry Ltd. "I find it inexcusable. I find our approaches completely different than successful innovation economies around the world and that's why we keep getting fooled in these agreements," Balsillie said while appearing as a witness at last Thursday's Senate foreign affairs and international trade committee meeting. Canada signed the text of the agreement in February, but full ratification is supposed to be put to a vote in Parliament. "TPP wouldn't be such a bad idea for Canada if Canada had an innovation strategy that built our capacity to commercialize ideas that prosper under TPP and similar future agreements," Balsillie said. An innovation economy is different from a traditional goods economy, Balsillie said Wednesday in an email. "(The) market for ideas is created by judges, legislators and agency heads," he said, adding that a complete innovation strategy includes elements such as "bilateral and multi-lateral negotiation sophistication, provincial, federal and global judicial strategies." "But as it stands," Balsillie told the committee, "Canada went into TPP negotiations without ever consulting a single Canadian innovator and without a strategy for this critical aspect of an innovation economy called freedom to operate." Balsillie said his principal focus while at the helm of BlackBerry was to expand his freedom to operate while constraining that of others. In an email, Balsillie said that freedom to operate is both a legal concept about infringement of intellectual property and an innovation strategy. As a strategy, freedom to operate allows companies that generate their wealth from ideas to grow. "The bigger the space, the more you can advance down the field which translates into more growth, more private wealth and, in turn, more public wealth," he said. Successful innovation economies — and Balsillie doesn’t consider Canada to be one — use a variety of tools to help their companies keep growing, such as "technology standard setting, harmonization, judicial strategies, etc." During his committee appearance, via videoconference from Toronto, Balsillie stressed that the TPP was creating new rules governing the protection of intangible assets and that the countries that already export a large amount of intellectual property, such as the United States and Japan, will reap the greatest benefits. "A practical example comes from the sector I built my career in," Balsillie told senators. "Today, smartphones are built from tangible goods. But the profit that is generated from them is dwarfed by the intellectual property that is captured in the form of patents." Balsillie said he used the commercialization structures built outside of the country to help BlackBerry compete on an international stage. "It's a catastrophic confusion of a science and technology strategy with an innovation strategy and the fact that freedom to operate is a new concept being introduced to you in March 2016 when it was the epicentre of what I did for 20 years and it was the epicentre of my engagement with governments around the world commercializing Blackberry — I think the policy community in Canada has a lot to answer for this," Balsillie told the committee. Science and technology strategies are not the place to address freedom to operate, Balsillie said in the email. Instead, freedom to operate is "a critical element of an innovation strategy because it's designed to protect and expand the ability of domestic companies/entrepreneurs that are generating ideas," he said. In addition to the U.S. and Japan, Balsillie pointed to countries such as Germany, Israel and Sweden as places where he's witnessed a "sophisticated innovation ecosystem built by the government in partnership with the innovators and that is completely absent in the Canadian economy." The new Liberal government's renaming of Industry Canada to Innovation, Science and Economic Development Canada "doesn't help or hurt" the situation, and it doesn't automatically suggest they know the difference between science and technology and innovation, Balsillie said in the email. "What we have to see, for the first time in Canada’s history, is an innovation strategy designed to commercialize Canadian ideas to scale globally," he said. "If the Liberals do this, they will unlock tremendous potential that Canadians have to generate new private and public wealth. I sincerely hope they will learn from past failures and create a proper innovation strategy." — With reporting by Charelle Evelyn at cevelyn@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

TPP exposing Canada’s innovation weak link: Balsillie

News | April 1, 2016

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