Canada is aiming to establish data centers that are not just physically situated within the country but also under its control. This distinction is crucial in reducing reliance on U.S. tech giants and ensuring that Canadian data remains subject to Canadian regulations. However, as over 160 data-center proposals undergo review by Ottawa to meet the increasing demands of artificial intelligence, the concept of “sovereign” infrastructure faces the challenge of how much control can realistically be exerted over data centers that may still rely on foreign hardware, clients, and digital networks that may not always adhere to national boundaries.
Ritesh Kotak, a Toronto-based legal and technology advisor, anticipates that this issue will be a significant tech concern for the country. Many nations, including Canada, heavily rely on U.S. companies like Amazon and Microsoft for digital and cloud services. Recently, a Canadian individual filed a lawsuit against the U.S. Department of Homeland Security for allegedly seeking extensive personal information through Google following critical social media posts about the Trump administration.
The Canadian government’s push to develop more Canadian-based AI infrastructure is influenced by concerns about data sovereignty. Telus has become the first successful applicant for the federal data-center program, although negotiations are ongoing, and no federal funding has been confirmed. The government has allocated $925.6 million over five years in the latest federal budget to support “large-scale sovereign public AI infrastructure.”
Following Telus’s announcement of collaborating with the government to establish three new data centers, Bell Canada’s CEO, Mirko Bibic, expressed enthusiasm about the increasing momentum in developing large-scale AI infrastructure in Canada. The federal government, alongside Canadian technology leaders, emphasizes the importance of data sovereignty, yet questions remain about the extent of foreign involvement in Canadian data centers.
While constructing data centers in Canada is a step towards addressing control issues, it does not fully resolve them. Not all equipment will be locally manufactured, and facilities like Telus’s will incorporate over 60,000 graphics processing units from Nvidia. Data-center developers and operators will not be limited to serving only Canadian entities, as per Evan Solomon, the minister of artificial intelligence and digital innovation.
Louis Têtu, the executive chairman of Montreal’s Coveo, stresses the significance of having Canadian firms operate data centers using top-tier global technology with Canadian governance to ensure immunity to geopolitical influences. Despite the emphasis on data sovereignty, privacy experts anticipate further regulations from Ottawa as part of the promised federal AI strategy to reinforce control over data centers and telecommunications operations within Canada.
Sharon Polsky, president of the Privacy & Access Council of Canada, raises questions about potential regulations restricting foreign ownership in private sector companies involved in data centers and telecommunications. The challenge of maintaining Canadian data within the country’s borders amidst global digital traffic complexities is also acknowledged by industry experts like Rudi Carolsfeld, co-founder of Victoria-based Green Edge Computing, specializing in small-scale data centers for local data storage needs.