The Internet needs freedom, not regulation

We live in an amazing world. There's a good chance you're reading this column on a tablet while sipping coffee on a sofa. Or perhaps on your Android or Apple smartphone while riding the subway. If so, you can thank the hard work of Internet entrepreneurs.

Workers benefit too. Just ask the thousands of people employed by the Internet industry across Canada. In 2011, the consulting firm McKinsey reported that 21% of GDP growth in advanced economies over the past five years could be attributed to the Internet.

But one thing could stall this engine of growth and productivity: ill-conceived regulations, promoted by overzealous bureaucrats.

Recently, in Ottawa, the Standing Committee on Access to Information, Privacy and Ethics released its report on privacy and social media. The report focused on the efforts and measures taken by social media companies to protect Canadians' personal information. Fortunately, it did not recommend imposing new regulations but focused instead on better complying with existing ones.

It would certainly be ill-advised to slow down innovation and growth with unnecessary bureaucratic micromanagement — especially during a sluggish economic recovery. In Canada, the Internet industry attracts millions of dollars of investment, and generates productivity gains for a large number of our small and medium-sized businesses.

Let's keep in mind that the more regulations there are, the more companies will have to redirect both time and money away from managing their businesses in order to comply with those regulations. Who's going to foot the bill at the end of the day? The consumer, most likely. By getting inferior and costlier products and services.

Of course, there is a need to strike a balance between Internet companies' desire to innovate with new products on the one hand, and protecting Canadians' personal information on the other. But above and beyond any need for new rules, we must encourage and reward individuals who take risks and start new businesses. We need to protect Internet freedom.

Not everyone understands this. In Europe, stringent e-privacy regulations have been enacted and EU technocrats have granted themselves large enforcement powers. This has become another burden for the Internet industry — one of many, unfortunately, for those doing business there right now.

So far, thankfully, we haven't gone that route. And the House of Commons report is further good news for the Canadian Internet industry. That's one sector that can keep growing if we keep things that way.

Michel Kelly-Gagnon est président et directeur général de l'Institut économique de Montréal. Il signe ce texte à titre personnel.
* Cette chronique est publiée dans les journaux de Sun Media, tant dans ses quotidiens présents dans plusieurs des marchés urbains canadiens les plus importants (Toronto, Ottawa, Calgary, Edmonton, Winnipeg et London) que dans ses 28 quotidiens régionaux.