Ottawa to prioritize Canadian cloud providers amid industry pushback on US shortlist

Federal officials are working on a plan to steer more cloud computing contracts toward Canadian companies after receiving significant pushback from industry stakeholders over the government’s decision to shortlist a small number of US multinational tech firms for such work.

Shared Services Canada spokesperson Michael Gosselin confirmed that the department is in the “initial planning stage for the development of a parallel system” focused on Canadian cloud providers, Caliber.Az reports per foreign media.

"Industry feedback and consultation is a key part of the government’s efforts to transform its IT infrastructure," Gosselin added.

The controversy arises from the ongoing competition to provide cloud services for the Canadian government over the next 25 years. The federal government has already narrowed down the list to four companies: Amazon Web Services, Google Cloud, Microsoft, and Oracle. Many industry leaders, including Craig McLellan, CEO of Canadian cloud provider ThinkOn Inc., have expressed concerns, citing that using Canadian companies could offer strategic benefits in light of rising geopolitical tensions with the US.

"I think that what has been happening in the US is a wake-up call for the public sector in Canada, that acquiring these services domestically can result in more competitive local providers,” McLellan remarked.

Industry feedback, obtained through an access-to-information request, reveals concerns that the competition does not award extra points for genuine Canadian companies, with some participants warning that a narrow set of requirements could limit competition. One participant stated, "Using Canadian companies guarantees that the entire design, engineering and support team resides in Canada. This provides invaluable benefits 'in an unstable geopolitical context.'"

Benjamin Bergen, president of the Council of Canadian Innovators, emphasized the importance of prioritizing Canadian firms for data-storage contracts, citing national interest and sovereignty concerns: “On something as critical as this type of government infrastructure, is allowing foreign firms to be the controllers of that really in our national interest?”

The federal government is expected to explore additional contracting opportunities for Canadian cloud companies post-election.

By Vafa Guliyeva