Alphabet’s Sidewalk Labs taken down a few pegs in smart city plan

Sidewalk Labs has massively scaled back its plans for its smart city development in Toronto, from 190 acres to just 12 acres at Waterfront Toronto. Still dependent on a public consultation, this huge climbdown is a major embarrassment, and possibly the clearest signal that the tide of public acceptance of web-major expansion has turned.

Sidewalk Labs is still trying to spin the news as a positive. CEO Dan Doctoroff said “we are encouraged by [the] decision by the Waterfront Toronto board and are pleased to have reached alignment on critical issues with Waterfront Toronto.” Of course, the public consultation could see Toronto tell the company to sling its hook, and the appropriately named Block Sidewalk is calling for just that.

Nonetheless, the board of Waterfront Toronto has agreed unanimously that Sidewalk’s revised plan can move ahead to the evaluation and consultation stage. Since the first draft was submitted in June, Waterfront Toronto, a group set up by the national and local Canadian government, has “reached alignment” with Sidewalk, after raising concerns with the initial proposal.

Perhaps most significant is the death of the Urban Data Trust, and the term ‘urban data’ itself. This was the most contentious part of the initiative, and something that Sidewalk could not mitigate. Due to Google’s presence, any talk of data processing and storage was met with derision, and the concept of storing all this smart city data inside a central trust was an easy stick with which to beat Sidewalk.

But not having some sort of data trust would be a missed opportunity. We have written about the opportunity that data marketplaces represent in the IoT, and with such an extensive smart city project, and one that could tap into all manner of other systems in Toronto, the city could have had a world-beating platform on which to build other applications.

Now that the project has been rolled back to just 12 acres, this scope has been greatly diminished. Sure, Sidewalk could lay the foundation for a city-wide data platform, but the public consultation could just as easily shoot down the proposal entirely. The fear that Google was somehow going to hijack this trust has been pervasive, and shows no sign of going away until Sidewalk itself steps out into the dark night.

Also notable is Sidewalk’s decision to step down as the lead developer, with the company now planning on partnering with real estate developers for specific elements. In giving up this chief coordination role, Sidewalk likely hopes that it will not be seen as such a central figure in the process, which might in turn help its public perception.

The Overview of Realignment to Sidewalk’s Master Innovation and Development (MIDP) proposal outlines the changes made. In it, Waterfront Toronto says that it has told Sidewalk that the concept of the 190-acre (0.3 square-miles) IDEA District is premature, and that it must see its objectives achieved in the 12-acre Quayside development, before it could consider expanding the footprint.

A section on digital governance and privacy also requires that all personal information shall be stored and processed in Canada, which looks like an attempt to keep Google from using such data – although it would be foolish to think that, if Google wanted, it could not find a way around such a rule. Data generated here must, it says, be treated as a public asset.

There is also a clause that Sidewalk will offer a global patent pledge to let Canadian ‘innovators’ use all of Sidewalk’s patents, with the public sector entitled to a “revenue stream on products and services piloted in Waterfront Toronto-facilitated testbeds.”

Sidewalk CEO Doctoroff said “we want to be a partner with Waterfront Toronto and governments to build an innovative and inclusive neighborhood. After two years in Toronto and engaging and planning with over 21,000 Toronto residents, we are looking forward to the next round of public consultations, entering the evaluation process, and continuing to develop a plan to build the most innovative neighborhood in the world. We are working to demonstrate an inclusive neighborhood here in Toronto where we can shorten commute times, make housing more affordable, create new jobs and set a new standard for a healthier planet.”

It would not surprise us if Sidewalk quietly dropped the project. It has been an embarrassment – a sign of Silicon Valley’s overconfidence, that they would be welcomed into cities with open arms. Instead, in the post-Cambridge-Analytica world, the public has become somewhat hostile, looking for the ulterior motives. Surveillance capitalism is now a term that gets used at least infrequently in the press, and consumers are becoming increasingly aware that if they are not paying for a product or service, they themselves are the product – or rather, the data they generate for these companies.

A final vote from the Waterfront Toronto board is due in March 2020, after which, public consultation will take over. In the current guise, the plan will ensure that Sidewalk follows all the data and privacy laws, participates in proper public procurement bids, and does not act as a lead developer, all inside the much smaller Quayside plot. It is not even allowed to make mention of the IDEA District anymore.

Sidewalk has been completely dressed down, and CEO Doctoroff has completely changed his tune on the essentiality of the IDEA District. Back in June, he told The Financial Post that “we do not believe that just at the scale of Quayside, that Waterfront Toronto’s priority objectives can be achieved. Speaking to the same outlet this week, he said “maybe this is from your perspective parsing things a little bit, but let me give you an example of how going forward and what I said last time can be reconciled. We do not believe we can do that at the scale of Quayside, so we will not have achieved their objective.”

Nonetheless, the project might just still go ahead. Ontario’s premier Doug Ford said that “by focusing the Master Innovation Development Plan on the 12-acre Quayside parcel, ensuring that the land was valued at a fair market price and that the privacy of data collected on the site is protected, the right balance has been struck between protecting the interests of the people of Ontario and encouraging investment, innovation and economic development.”