My colleague Jennifer Kervin wrote last week about the Council of Canadian Innovators' (CCI) new playbook for Atlantic Canada. 

The playbook is a policy document on procurement, IP, AI, and market access. I know, a real page-turner, but stay with me.

AI is going to make a lot of software easy and cheap to build. No, you can’t vibe code enterprise-ready software today, but the gap is closing. To compete, companies will have to focus on where they can differentiate and serve their customers.

Two of the companies Kervin wrote about offer lessons for what that adaptation might look like.

Jon King started Milk Moovement after working with the Dairy Farmers of Newfoundland and Labrador, where he watched ten provinces try and fail to agree on a shared IT system. 

He built something that worked for his own province, left to turn it into a company, and today roughly 24% of the US dairy supply chain runs on it.

Milk Moovement sells software. Its customers are buying years of learning how the dairy industry works, the relationships King has built, and the trust to act on their needs.

Emad Rizkalla, who founded Bluedrop ISM at Memorial University, calls this results-as-a-service. Customers used to pay for the software. Now they pay for what the software helps you deliver.

The CCI playbook calls for a similar approach across the industries where Atlantic Canada has advantages: oceans, defence, agritech, fintech, and energy. The region's companies win because they know one industry better than anyone, hold the data that explains how it works, and keep customers because they deliver. The playbook's asks on procurement, IP, AI, and market access are all in service of protecting that depth.

Some light reading for when knowing your industry beats knowing how to code.

Ottawa is putting its money where its mouth is on AI infrastructure. Two announcements from Minister Solomon this week: a proposed large-scale data centre project with Telus in BC and $66 million in funding through the AI Compute Access Fund for 44 Canadian companies. Telus CEO Darren Entwistle says the first AI factory in Rimouski sold out. 

Just because you can vibe code it doesn't mean IT shouldn't know. I wrote this week from the CIOCAN Peer Forum in Vancouver about a Canadian energy company where an employee used generative AI to write a data pipeline and pushed it into production at three in the morning. Nobody on the technology team knew it had been written. The pace of vibe coding is running well ahead of the governance most organizations have in place.

Canada spins off its only compound semiconductor lab. The federal government is moving the National Research Council's Canadian Photonics Fabrication Centre into a commercial entity. It's the only facility of its kind in North America. Photonics is the technology that goes inside AI data centres when conventional hardware hits the wall in terms of heat and power.

Cohere goes the other way on the AI noise. Chief AI officer Joelle Pineau tells AFP that Cohere is "a very low drama company" and rallies internally around "ROI over AGI." Last month they announced a deal to acquire Germany's Aleph Alpha at a roughly $20 billion combined valuation, pitched as a sovereign alternative to American AI. Today they announced the acquisition of Montreal- and Berlin-based Reliant AI, a biopharma AI company whose tech will power a version of Cohere's North platform built specifically for the pharmaceutical industry.

Just as I was finishing this newsletter, I came across Cohere's announcement about its acquisition of Reliant AI, a Montreal-and-Berlin biopharma company.

The deal brings a research team and proprietary biomedical datasets into a version of Cohere's North platform built for the pharmaceutical industry.

I couldn't have asked for a more conveniently timed reinforcement that as AI builds more of the technology around us, knowing your customer and your industry is where the value will sit.

A small programming note. The Digital Journal team is at Upper Bound in Edmonton this week. If you're there, find us. 

We’ll have daily recaps on Digital Journal and more from Upper Bound in next week’s newsletter. 

— David