Activists say Alphabet’s planned neighborhood in Toronto shows all the warning signs of Amazon HQ2-style breakup

Quayside will sit along Toronto's Eastern Waterfront.

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Quayside will sit along Toronto’s Eastern Waterfront.
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Sidewalk Toronto

  • Sidewalk Labs, the urban innovation arm of Google’s parent company, Alphabet, plans to build a high-tech neighborhood along Toronto’s Eastern Waterfront.
  • Local residents concerned about the company’s plan to collect data in public spaces have waged an opposition campaign called Block Sidewalk, which is calling for an end to the project.
  • The backlash is reminiscent of protests over Google’s planned campus in Berlin and Amazon’s proposed headquarters in New York City – both of which were abandoned before construction had even begun.
  • The fate of these projects could provide a window into Alphabet’s future in Toronto.
  • Visit BusinessInsider.com for more stories.

Technology companies were once heralded as the world’s greatest problem-solvers – the answer to our desire to move faster, design quicker, and communicate more often. Today, they’re blamed for all manner of ills, from skyrocketing rents to privacy violations to income inequality.

Before this deep distrust began to bubble up in our culture, it would have been hard to imagine any city saying no to a development led by tech giants such as Amazon or Google. But that’s exactly what’s happening in cities like Berlin, New York City, and Toronto, where citizens have begun to challenge the role of tech companies as city-builders.

In October 2018, Google cancelled plans to build a 32,000-square-foot campus in Kreuzberg, Berlin, amid activists’ fears that the campus would drive up rents and push low-income residents out of their neighborhoods.

Read more: There’s a battle brewing over Google’s $1 billion high-tech neighborhood, and it could have major privacy implications for cities

Three months later, Amazon made the stunning decision to walk away from its planned second headquarters in New York City, known as HQ2, following a similar resistance from local politicians, who banded together to oppose the new development.

As the two projects fought to stay alive, Sidewalk Labs – the urban innovation arm of Google’s parent company, Alphabet – was developing plans for a $1 billion high-tech neighborhood in Toronto.

That project is now facing a similar opposition from angry residents who have called for its demise. As the backlash gains momentum, it could force Sidewalk Labs to abandon or alter its vision.

Protesters make noise outside the Umspannwerk building in Berlin, where Google planned to open a campus.

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Protesters make noise outside the Umspannwerk building in Berlin, where Google planned to open a campus.
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Sean Gallup/Getty Images

Sidewalk Labs has a hazy vision for a new kind of neighborhood

Unlike the previous Amazon and Google developments, Sidewalk Labs isn’t attempting to build a hub for its employees. The Alphabet subsidiary wants to construct an entirely new neighborhood in Toronto – basically a living lab for urban design – from scratch. The real-life “SimCity,” known as Quayside, will sit atop 12 acres of land along Toronto’s Eastern Waterfront.

The company says its goal is to “set new standards” for how cities are designed and built, but the bulk of its ideas, including heated roadways for driverless vehicles and underground sensors that measure things like air quality and noise, aren’t exactly new.

In December, the company released a draft of its site plan that shows a mixed-use development with both commercial space and “flexible” floors that include retail and community areas. The majority of the neighborhood will be dedicated to housing – around 2,500 units for an estimated 5,000 residents. About 20% of this housing is labeled “affordable,” though the company doesn’t refer to specific income brackets.

The plan highlights concepts such as “people-friendly” roads, “animated” ground floor spaces, and “exceptional” bicycle infrastructure. Buildings will be made of mass timber and rely on sustainable heat sources like solar panels and geothermal wells. The most futuristic design elements are robots that deliver mail and transport garbage through underground tunnels.

The company has yet to release its full master plan, which is supposed to be approved by its board of directors and development partner, Waterfront Toronto, by September 30.

Some Canadians have begun to question whether the opacity is intentional. “By the time we get to the plans, essentially the decision has been made,” said surveillance expert David Murakami Wood, who teaches at Queen’s University in Ontario.

Murakami Wood described the neighborhood as an “empire of choice,” where citizens’ needs and desires are satisfied by, but also dependent on, Google technology.

Some people are concerned that Quayside will violate their privacy

Around the same time that Amazon pulled out of New York City, Sidewalk Labs was enduring its own string of controversy. In February, the Toronto Star published leaked documents that showed the company’s desire to fund a new light rail transit line in Toronto. In exchange, it would receive discounted property taxes and collect fees from developers that would normally go back to the city.

In a statement to The Canadian Press, Toronto city councilman Gord Perks said the leak was “confirmation of our worst fears.” He then called upon Canada’s national, provincial, and local governments to “halt the process with Google.”

Prior to the leak, Sidewalk Labs and Waterfront Toronto had already generated criticism for a lack of dialogue with community residents. Attendees of public meetings hosted by the two entities said each meeting started with a presentation that informed community members of existing plans rather than asking the public to help build ideas from scratch.

From the very first community meeting, “the public really didn’t have a say” said Melissa Goldstein, a Torontonian who’s been vocally opposed to the project. Goldstein said Sidewalk Labs responded to her critiques by “gaslighting,” or making her feel that her concerns weren’t valid.

“Every time a criticism is made of what they’re doing, they basically absorb that criticism, re-package it, and sell it back to us as if they’d always thought this all along,” Murakami Wood told Business Insider. “It’s very basic and very obvious, and yet people fall for it every time.”

Sidewalk Labs previously told Business Insider that their ideas have “evolved, developed, and benefited” from the public’s response.

A rendering of Quayside.

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A rendering of Quayside.
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Sidewalk Labs

The struggle to achieve transparency over rudimentary plans has many locals, including tech workers and business execs, questioning the company’s approach to privacy.

By capturing the activity of residents through underground sensors, Sidewalk Labs would learn about certain daily movements and behaviors, like when a person is stopped at a traffic light or seated on a park bench. The company has pledged to make all of its public data anonymous, but it hasn’t agreed to keep its data local.

Sidewalk Labs believes that its Quayside data can be governed under Canadian law without exclusively residing in the country. This would allow companies – and particularly startups – outside Canada to use the data for their own competitive agendas.

To see how a practice like this could play out, it’s helpful to look at Facebook, which has been known to share users’ contact information, calendars, friend lists, or private messages with companies like Apple, Spotify, and Netflix.

For the most part, this information has helped companies customize their user experiences and target new customers. But, in 2018, Facebook sold data on tens of millions of Americans to an English political consulting firm called Cambridge Analytica, which allegedly used this information to support Donald Trump’s election in 2016. A year after the scandal broke, Facebook announced it would no longer provide third-party data services for targeted advertising.

Sidewalk Labs insists that the way to protect residents’ personal information is to develop strong contracts and methods of encryption.

The company has issued a lengthy proposal for an independent data trust that would hold it to the same standards as any other organization or government body. But the company also said there are no existing laws that determine ownership of this information, and few regulations that successfully protect it.

The trust, Murakami Wood said, is “a clearinghouse for other corporations to use that same data,” which he said would be difficult to police outside Canada.

Residents are campaigning to ‘Block Sidewalk’

Days before the data trust was announced, a technology expert on Waterfront Toronto’s Digital Strategy Advisory Panel, Saadia Muzaffar, resigned over a lack of transparency. The panel, which formed in April 2018, focuses on guiding the fair and safe use of data technology in Quayside. Muzaffar was soon joined by one of the project’s privacy experts, who was concerned that Sidewalk Labs wouldn’t properly govern people’s information.

Their criticism has been echoed by Bianca Wylie, the co-founder of Tech Reset Canada, an organization that advocates for using technology to maximize the public good.

Back in October, Wylie questioned the need for Sidewalk Labs to collect personal information, worrying that it could be used to further its financial interests. At the time, she was still talking with Sidewalk Labs online and at public meetings. But when the leaked documents were published in the Toronto Star, she decided that the project had gone too far.

That was the “tipping point,” she told Business Insider.

Toronto's Eastern Waterfront.

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Toronto’s Eastern Waterfront.
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Sidewalk Toronto

Wylie helped organize a campaign called Block Sidewalk along with 30 other locals, including Goldstein and Murakami Wood. The movement has since swelled to encompass hundreds of people with reservations about the project.

“What we know about Sidewalk Labs is that they’re accountable to their shareholders,” Wylie told Business Insider. “If they’d read the room, they would [walk away].”

As with Amazon HQ2, it’s unclear how many residents actually oppose the development. A February poll conducted by the Toronto Region Board of Trade (TRBOT) showed that a slim majority of Torontonians were in favor of Quayside, but the poll was conducted prior to the leaked documents in the Toronto Star. As a trade organization, the TRBOT also stands to benefit from new development.

Goldstein said there’s a lot less criticism of Google in Toronto than in other cities. One reason for this, she said, is that many residents associate Google with technologies that have improved their lives, such as Gmail and Google Maps. Though Toronto has its fair share of tech companies, it also hasn’t witnessed the explosive tech takeover that widened inequality in US cities like Seattle, Washington, and San Francisco, California.

Goldstein also believes many Toronto residents don’t understand the project’s details.

“The vast majority have absolutely no idea what’s going on,” she told Business Insider. “It’s hard to be opposed to something when you don’t know anything about it.”

There are similarities between Quayside and Amazon HQ2

In response to these criticisms, Sidewalk Labs pointed Business Insider to a recent editorial written by CEO and co-founder Dan Doctoroff.

“We weren’t trying to do anything in secret – and none of what we are considering could ever happen without robust public discussion and approval processes – although we recognize that it might have seemed that way,” Doctoroff wrote. “We aren’t yet sure ourselves what commitments we are prepared to make.”

Sidewalk Labs CEO and co-founder, Dan Doctoroff.

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Sidewalk Labs CEO and co-founder, Dan Doctoroff.
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Alana Kakoyinannis/Business Insider

Doctoroff sees Sidewalk Labs as a “catalyst” for development along the Eastern Waterfront. But Block Sidewalk says the company is behaving like a government.

Back when Amazon HQ2 was still headed to Queens, it was difficult to tell which priorities belonged to the tech giant and which belonged to New York City. The deal seemed to fulfill certain government wish-list items, like a slew of high-paying tech jobs and investments, but it also afforded Amazon nearly $3 billion in tax incentives.

The ongoing debate in Toronto raises similar questions about who’s in charge. Sidewalk Labs has characterized its activity as executing the vision of Waterfront Toronto, a government agency, but Murakami Wood said Waterfront Toronto “seems intent on giving away control.” As the public meetings went on, he said, Sidewalk Labs “showed nothing other than supreme arrogance” in pushing forward their own ideas without properly addressing residents’ concerns.

According to Miguel Gamiño, New York City’s former chief technology officer, development projects work best when local citizens are placed at the center of the conversation. Both Amazon HQ2 and Quayside, he said, would have benefited from more dialogue and better engagement between residents, government, and the private sector.

The project’s future is uncertain

Wylie said the HQ2 debacle taught her how much it matters to speak up about local development practices. In the future, it might also provide a blueprint for how Torontonians could pressure Sidewalk Labs.

When New York activists and politicians began opposing Amazon HQ2 last year, the company was forced to rethink its deal. In a statement announcing their change of heart, Amazon said that friction with local and state politicians prevented it from “go[ing] forward with the project we and many others envisioned in Long Island City.”

The same could happen to Quayside if Toronto’s rallying cry becomes any louder.

“If Sidewalk Labs looks like it’s creating bad publicity for Alphabet as a whole, Alphabet will drop Sidewalk Labs,” Murakami Wood told Business Insider.

Sidewalk Labs did not say whether this was a possibility, but a spokesperson recently told the Canadian Press that it “will be up to residents, Waterfront Toronto, and all three levels of government to decide” if the plan moves forward.