The Federal Trade Commission is working
towards a new approach to the Internet of Things that will meet the
demands coming from all sides of the IoT space.
Following a sharp rise in the number of
complaints from consumers, the United States Federal Trade Commission –
whose basic mission is to promote consumer protection and eliminate
anti-competitive business practices – has announced a date for its
planned
workshop
on regulation governing the Internet of Things. It will focus on
working towards clear-cut recommendations for enforcing privacy and
security. This highly complex industry already accounts for over
2 billion connected objects
worldwide, and is now increasingly the center of public concern over
network security and personal data protection. These two areas of
concern are inextricably linked, for example in such areas as ‘smart’
homes.
Broadening the categorization of ‘sensitive data’
Up to now the FTC has followed the lead of legislation in force governing online data. In its
2012 Privacy Report,
it defines a number of categories of what is deemed to be ‘sensitive’
data. These comprise a pot-pourri of financial, medical and geolocation
data, plus any and all information regarding minors. Developers are
required to seek explicit prior consent before using these kinds of data
and companies are called upon to beef up their data protection
measures. However, the category-by-category approach used up to now
leaves all other types of data in a sort of regulatory limbo – for
instance, video content is not specifically covered by the current
definition. Looking at the outcome of an FTC
decision taken last month, law firm
Hogan Lovells
believes that the Commission is now trying to distance itself from its
earlier position and seeking to extend the concept of sensitive data to a
much wider range of services.
Joint demand from consumers and developers
Lack of clear, stable regulation constitutes a destabilizing factor
for this emerging sector, which looks certain to become a mass market
industry. Kaivan Karimi, Executive Director of Global Strategy and
Business Development at semiconductor manufacturer
Freescale,
recently called on the FTC to clearly define the meaning of data
protection before serious dysfunctions arise which damage the
credentials of the industry. Meanwhile both the
Electronic Privacy Information Center on
the one hand and a large number of sector entrepreneurs on the other
are calling for a stronger regulatory framework that will enable the
industry to develop in a stable manner. In addition to personal data
protection, some consumers are also becoming concerned about the
knock-on effects of more widespread surveillance systems.For example
some car hire firms now automatically charge extra when the customer
exceeds the speed limit or makes use of certain in-car services.
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