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Report on Business Sidewalk Labs CEO calls some criticisms of Toronto Quayside project ‘unfair’

Sidewalk Labs chief executive Dan Doctoroff says he is not concerned about resignations from Waterfront Toronto’s board and digital-strategy panel over a proposed 12-acre development in the city, calling some of the members' criticisms “unfair.”

Sidewalk, a subsidiary of Google parent Alphabet Inc., and government agency Waterfront Toronto, announced plans for a community called Quayside on the city’s lakeshore, exactly a year ago. The project would be a neighbourhood of homes, offices and retailers where sensors would collect data on such things as pedestrian numbers and air quality to guide its operation.

Since then, developer Julie Di Lorenzo has left Waterfront Toronto’s board, and entrepreneur Saadia Muzaffar and venture capitalist John Ruffolo have resigned from the digital-strategy advisory committee, which was formed to review the project’s policies regarding the technology and the data. All cited concerns over how Sidewalk’s partnership with the agency was being run.

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The Globe reported on Tuesday that three additional Waterfront digital-strategy advisers say they plan to resign if issues they have about the project are not addressed at their meeting on Thursday. Among their concerns are what they call short timelines to review data proposals, the fact that Sidewalk is involved in developing the project’s data policies and insufficient leadership from Waterfront Toronto on the project.

“I think, to some extent, some of the criticisms were unfair, because they prejudged something before the processes actually unfolded,” Mr. Doctoroff told reporters at the Fortune Global Forum in Toronto on Wednesday. Sidewalk revealed a data-governance proposal this week under which the company would put the data in an independent trust and develop processes to allow free public access to it, and potentially create solutions to urban problems that could be developed into intellectual property (IP). Sidewalk said the data sensors would not collect identifying information without consent.

Last week, The Globe and Mail reported details of a new advisory council Sidewalk Labs set up, separate from Waterfront Toronto’s, after open-data advocate Bianca Wylie revealed it. A spokesperson for Sidewalk said nearly 70 people have signed on to the multi-industry council, which held its first meeting on Wednesday.

Mr. Doctoroff said the criticisms from current and former Waterfront Toronto advisers did not deter him. “I’m also somebody who believes, even when you disagree with something, you should try and make it better,” he said. “I think we have done nothing but demonstrate that we are open and listening.”

Waterfront Toronto spokeswoman Carol Webb said in an e-mail to The Globe this week that the Sidewalk Labs data proposal "starts an important conversation and consultation around digital governance. It is an opportunity to ask for clarifications, more explanation and gather information. It’s the first step in a new process.”

Canadian innovators have raised concerns around IP ownership, which they see as a potential wealth generator, although one where Sidewalk, as creator of the neighbourhood, and its affiliate companies could have an advantage. In August, The Globe reported on a design-procurement document that showed Sidewalk was seeking full ownership of design IP.

Sidewalk’s data-governance proposal released this week did not address IP concerns in detail, although the company has said more information would be ready for Waterfront Toronto’s digital-strategy advisers to review at a future meeting. But, Mr. Doctoroff said, “where something is developed here, where we’ve uniquely been able to take advantage of this opportunity, we are very open to sharing the benefits of those intellectual-property innovations.”

In an interview with The Globe’s editorial board on Wednesday, Mayor John Tory said he had “acute concern” over the transparency of Sidewalk and Waterfront Toronto’s partnership so far, and that the process of bringing Sidewalk Labs to Toronto “was not handled the best way.”

“I think it was announced with too many unanswered questions and too little consideration had been given to making sure you made transparent … the information that was in hand at the time about what the deal was,” Mr. Tory said. He said met with Mr. Doctoroff and former Alphabet executive chair Eric Schmidt last month and raised these concerns.

Innovation Minister Navdeep Bains on Wednesday brushed aside concerns over whether Sidewalk might have an inherent advantage in generating IP from the project. “We want to see investments from multinationals in Canada, and we want to see Canadian companies have the ability to scale,” Mr. Bains said. “This is what our policy and programming reflects. It’s not one or the other.”

Sidewalk did not permit media to attend its advisory council meeting on Wednesday, but sent reporters the text of a speech Mr. Doctoroff would make there. In it, Mr. Doctoroff refers to Sidewalk as the “catalyst” in a public-private partnership to enable more affordable and sustainable neighbourhoods.

The company, he writes, seeks to develop infrastructure and urban innovations – such as new kinds of storm-water management and waste removal – while only seeking a role in real estate development “to prove to the private market that our vision is worth investing in.” But Sidewalk, he continues, expects to “make a reasonable return from financing this infrastructure.”

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Sidewalk is also generating a “digital planning tool” that would let the company, the public and policy-makers “evaluate trade-offs between density, open space, mixes of uses, and affordability, and building types.”

Mr. Doctoroff also wrote that the company would bring an urban innovation institute to the neighbourhood to create a “living laboratory” for entrepreneurs to examine ideas to improve urban communities.

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