Time for a digital divorce? Trade war puts spotlight on Canada’s relationship with U.S. big tech

Trade and political tensions between Canada and the United States have raised concerns about Canada’s digital sovereignty, but what does that term mean, and how can Canada promote it?

While it may sound like jargon, experts say digital sovereignty can be defined simply. 

It’s about regulation, Vass Bednar, managing director of independent public policy think-tank the Canadian Shield Institute, told CBC Radio’s Just Asking.

“Fundamentally, our digital sovereignty is our ability to regulate digital environments using the tools that we have,” she said, including regulation of algorithms that influence what information we see online.

It’s also about choice and the law, according to Michael Geist, Canada Research Chair in internet and e-commerce law at the University of Ottawa.

“It’s fundamentally about both the ability to make Canadian choices … so we have alternatives to some of the larger —  predominately U.S. — players, and also ensuring that Canadian law applies,” he told CBC Manitoba’s Information Radio last week.

The federal government also has a definition.

“Digital sovereignty means Canada stays in control of its own digital future — including its data, technology and essential online services — instead of relying on foreign companies, foreign systems or foreign laws,” a government webpage reads.

“Think of it like this: Just as we want our homes, money and identities protected in Canada, we want the same protection for our digital information and services.”

A mid-August X post from the U.S. Trade Representative account said a potential trade deal between Canada and the U.S. would include “digital trade alignment,” which prompted expert concerns and speculation about digital sovereignty. Only days later, talks between the two countries fell apart at the last minute, reportedly over American insistence that U.S. streaming companies be exempt from Canadian content rules.

After talks broke down, President Donald Trump signed an executive order that Lake Ontario be renamed Lake America. Google and Apple Maps quickly implemented the change for American users, but some Canadians reported seeing it on their maps.

So, how American is our tech?

Right now, Canada doesn’t have many alternatives to American technology companies and digital platforms.

“We are heavily dependent on the American big tech companies when it comes to our Canadian businesses and the public sector,” said Shion Guha, assistant professor in information and computer science at the University of Toronto, on Just Asking.

The federal government also uses the Microsoft Office and Microsoft 365 platforms. In January, Shared Services Canada, which is responsible for providing IT services to the government, renewed its agreement with Microsoft in a deal worth $940 million over seven years.  

Guha was part of a study on the federal government’s AI Register which found that Microsoft was the single biggest supplier of systems, accounting for 42 of 409.

“An American big tech company is very heavily intertwined, not just with things like email or OneDrive … or Microsoft Office, but also in the types of predictive analytics and other types of AI products that the federal government has currently acquired,” Guha said.

“This type of dependence on one big tech company is generally not a good thing for any kind of sovereignty.”

There is precedent for switching, Bednar said, noting, “France has been a little bit ahead of the curve here.”

France’s Interministerial Directorate for Digital Affairs announced in April that it will remove Microsoft’s Windows operating system from government computers. Open-source software Linux will replace it.

The French government also developed Tchap, an instant messaging application, and mandated its use for public sector employees, citing security and privacy concerns. The French government says over 600,000 public sector employees use the app.

What can Canadians do?

But if getting the Canadian government to switch platforms could be difficult, getting Canadians to change everything from their credit cards to their cloud storage to their social media and instant messaging platforms and more could be even harder. 

Gander Social launched in July, marketing itself as a nicer, Canadian alternative to U.S. social media platforms. The company posted on Facebook last week, saying it’s approaching 50,000 users, though Bednar pointed out that Prime Minister Mark Carney isn’t among them.

WATCH | Gander wants to make social media more Canadian:

Homegrown app Gander wants to make social media more Canadian

Gander, a new social media app similar to X or Bluesky, was designed for Canadians — but many are skeptical that being homegrown alone will be enough to get users to try it.

But having Canadian options doesn’t mean Canadians will want them, Guha said.

“There is a certain amount of inertia in getting Canadians to switch to things, because convenience usually rules over most things,” he said.

“Just because we can, or do, have Canadian alternatives — and they may provide better features, they may be good for us — doesn’t mean that we can overcome the social inertia to get people to switch.”

But it is one way ordinary Canadians can promote digital sovereignty, Bednar said. Though she also acknowledged it’s going to require more “institutional imagination in Canada” to move forward.

Staying sovereign in the AI age

The Canadian government released its National AI Strategy in June. In it, the government pledges to develop a home-grown supercomputer, as well as “sovereign cloud, AI, cyber and quantum initiatives.”

Geist said the government should take an approach that balances building Canadian AI programs with access to foreign ones.

“If a single government gets to determine whether or not you have access to those frontier models, they’re really determining whether or not you’ve got the very best tools to counter things like cybersecurity threats,” he said.

Guha said the federal government has also started referring to the data centres that help power AI and other services as “critical infrastructure.”

The federal government’s five principles for data centre construction, released earlier this month, require projects to “strengthen Canada’s long-term digital resilience, security and compute capacity.” They also say that the facilities must follow Canadian laws on cybersecurity and data protection.

“If we don’t make the rules here, we will have to follow someone else’s,” AI Minister Evan Solomon said at a news conference announcing the principles, which arrive amid concerns about the U.S. government using its laws to access Canadian data.

Bednar said Canada’s current effort to assert its sovereignty against the U.S. is different from those of the past because of how much more of our lives exist digitally.

“Digital … is the infrastructure of our economy,” she said.

“It is just as, if not arguably more, important than manufacturing, automobiles, aluminum, steel — take your pick.”