Transaction Economics: Intellectual Property
We have provided some information below about what is in the MIDP to help inform your feedback. The survey questions follow at the bottom of this page. Once you have filled in your answers, please click “Submit." You can then either click “Next Section” to continue taking the survey or click “Done” to finish.
What Waterfront Toronto asked for:
The 2017 RFP stated that Waterfront Toronto and the selected Innovation and Funding Partner would lead development of an investment strategy for the Project. As part of this, the strategy was to address “ownership and sharing of intellectual property resulting from the Project,” and the Partner was required to submit “a preliminary framework for a potential management approach for Intellectual Property introduced to or developed through the Project, and any revenue sharing between Waterfront Toronto and the Partner.”
Sidewalk Labs’ Proposal
The framework put forward by Sidewalk Labs has two principal elements:
i. Profit Sharing / Testbed
In the MIDP, Sidewalk states that “neither Waterfront Toronto nor the public is primarily a technology developer,” and asserts that co-created technology (for which there would be co-owned Intellectual Property) is not likely to arise
To address Waterfront Toronto’s objectives, Sidewalk Labs has proposed that the public sector receive 10% of Sidewalk Labs’ global profits from “Testbed-Enabled Technologies” for a period of 10 years, starting when each technology is sold to a second customer
A “Testbed-Enabled Technology” is defined as a technology that is first deployed at scale in the project area, and for which the following conditions are established by the relevant stakeholders, as and if applicable to each technology:
Access to mount or deploy the technology in physical spaces;
A mandate to use common software standards that enable compatibility and interoperability (for instance, all building access systems must use the same open standard);
Approvals in place, up front, and regulatory conditions that support the physical, digital and operational conditions required;
Sufficient scale for efficacy or to otherwise achieve desired outcomes; and
An ecosystem that provides the opportunity for all the physical, software and regulatory conditions simultaneously.
Implementation agreements would establish a process to determine, prior to deployment, whether the product is a Testbed-Enabled Technology
ii. Patent Pledge
Sidewalk Labs proposes to pledge not to assert any granted patents in Canada which cover the software or hardware that enable digital innovations related to the project, so long as companies using those patents do not assert their own patent rights against Sidewalk Labs or its affiliated companies
The intent of such a pledge is to facilitate innovation and collaboration by third parties, including Canadian technology companies, in Quayside free of the threat of patent litigation
Sidewalk Labs states that it will publish the full content of the pledge on its website, along with a list of patents included in the pledge as they are developed
Waterfront Toronto’s Note to Reader Review:
Waterfront Toronto has given significant preparatory consideration to the issue of Intellectual Property and how value can be appropriately captured
Early thinking on risks to consider:
Waterfront Toronto has identified a number of challenges and risks associated with the sharing framework in the MIDP. For instance:
Will the project area be sufficient to meet the scale requirement for a “Testbed-Enabled Technology”?
A profit-sharing model creates challenges related to calculation or audit, as opposed to a revenue sharing model
While the Patent Pledge is useful, it does not obviate the need for other technology companies, including Canadian companies, operating in Quayside to obtain appropriate intellectual property protection when they sell into markets outside of Canada
What will the impact of the Patent Pledge be in helping to create a competitive innovation environment in Quayside, particularly for those suppliers who choose to take advantage of the patent pledge for their own Intellectual Property strategy?
Waterfront Toronto’s questions for you about Transaction Economics: Intellectual Property
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Our publicly-owned waterfront lands have enormous value. Sidewalk Labs is proposing that Waterfront Toronto reduce the price of public land in return for achieving policy outcomes, such as job creation, economic development, and sustainability (which Sidewalk Labs proposed to deliver).