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Kurtis McBride is CEO of Miovision

Serving on the Waterfront Toronto Digital Strategy Advisory Panel allows me to participate in important discussions on data, privacy, and the impact of technology on society.

Waterfront Toronto, an agency controlled by all three levels of government, established the DSAP last summer to advise on its partnership with Google-affiliate Sidewalk Labs to develop a 12-acre technology-driven neighbourhood on the city’s eastern Waterfront. As a panel, we’ve had some passionate discussions on how to best protect the privacy and security of citizen data collected in smart cities.

What makes cities, such as the proposed Quayside project, smart is the addition of data-generating infrastructure that measures everything from traffic patterns to energy consumption. Provided we get the governance right, insights from this data hold great potential to improve the quality of city life.

As important as data governance is, there are other discussions to have that are just as important for the DSAP, technology companies, citizens and their governments. We need to examine how data should be valued. It’s a topic many think has already been settled as governments embrace the open-government movement, which advocates for open access to data. Many advocates also argue for no cost (or a minimal cost) for access to this data to keep barriers to a minimum. That feels intuitively right; free data seems egalitarian – and who wants to argue against egalitarianism? But, I think it’s time we re-examine our assumptions.

As a technologist, I have two concerns in particular when it comes to giving away smart-city data.

First, the infrastructure upgrades required for collecting data from smart cities aren’t free. According to the Canadian Infrastructure Report Card, municipalities hold $1.1-trillion of municipal infrastructure assets and 35 per cent of those assets are in fair, poor or very poor condition. Replacing this aging infrastructure with smarter, data-generating alternatives presents an amazing opportunity; however, it will require municipal governments and the taxpayer to spend. In an age where municipalities struggle to balance budgets, the question remains: How will we pay for this much-needed infrastructure renewal?

Second, access to smart-city data will mostly benefit some of the world’s largest multinationals. Data-driven companies such as Sidewalk Labs’ owner Alphabet, social-media giant Facebook and online retailer Amazon are already among the biggest in the world based on market capitalization. That’s because of the deep pools of exclusive data on nearly everything their users do online. This information-asymmetry advantage makes competing with these companies nearly impossible. But they still don’t know everything. What’s missing is data on what we do offline. City data could help fill that gap, creating massive new value creation opportunities for these companies and their shareholders.

Giving these big technology companies free access to smart-city data will allow them to accrue significant value without any obligation to citizens or the local economy. Having paid for the infrastructure and provided the raw material – city data – citizens will see much of the resulting value literally given away to U.S.-based multinationals. If the goal is egalitarianism, this massively misses the mark.

There is a better way. Instead of giving away data for free, the value created from this smart-city data should be shared with citizens – either through improved city services or through new sources of revenue collected by the city. The only way to do this is to ascribe some value to the data based on its intended use.

Ensuring that citizens share in the value created from collectively owned resources is not a new concept.

For example, governments often grant access to natural resources through mineral rights. Private companies pay a royalty to mine these resources and governments use these funds to improve the lives of their citizens. Alberta’s oil resources, for example, generated $6.1-billion in royalties for the provincial government in 2014.

Smart-city data should be treated in a similar manner – as a resource that has value that should be shared.

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For example, imagine a company like FedEx used city data to optimize delivery routes, saving time and money and improving service for its customers. In this case, the value of the data would be primarily accrued by the company, so FedEx would pay to access the smart-city data, generating new revenue for the city.

In another example, we can imagine the data being used for a pure public benefit. If an advocacy organization like Cycle Toronto wanted to access the data to offer a free, public map of the safest cycling routes in the city, they could get it for no cost, as they are providing a free service that directly benefits the citizens of Toronto.

Who pays – and what uses are acceptable – could be decided by the same data trusts proposed in Toronto and elsewhere to control access to city-generated data while at the same time protecting privacy. For example, Sidewalk Labs has said it will keep data collected from sensors throughout Quayside in a “Civic Data Trust” that anyone can access, and that the data will be stripped of identifying information. My colleagues on the DSAP and I are still providing input on how this will work. Since these trusts will need to determine how data will be used from a privacy perspective, asking them to also assess potential value attribution – and how citizens might benefit – isn’t a huge leap.

Sidewalk Labs recently received a lot of attention for proposing ways to finance the construction of a smart city at Quayside. While some of these proposals generated a lot of controversy, the challenge they were trying to address – models for funding smart cities – remains. Exploring how to value data generated by smart cities provides an alternative way to meet this challenge while keeping the needs of citizens at the centre of the conversation.

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