Internet of Things: Ignore Privacy and Security at Your Peril

by Raimund Genes

The Internet of Things has the potential to transform the way we live and work. A network not just of mobile phones, PCs and laptops but billions of connected smart devices – from fridge-freezers to kettles, cars and medical devices. But this potential will never be realised unless manufacturers are able to respond to consumer privacy and security concerns around this next flowering of the internet.

That’s why we have commissioned the Ponemon Institute to undertake a major new study examining exactly what these concerns are. It covers the US, Japan and Europe – but let’s take a regional focus here and explore what consumers think about the Internet of Things across Europe.

Maximum caution
It’s clear from the outset that Europeans are more concerned about privacy than their counterparts in the other regions. Some 62% said they were concerned about privacy in the IoT compared to 49% in Japan and 44% in the US. This figure rose to 68% regarding privacy on social media – again higher than Japan (50%) and the States (46%). All respondents said they were concerned about security in the IoT and on social media, but Europeans were the most concerned about the latter (81%), compared to Japan (71%) and the US (68%).

Around half of European respondents said they were more concerned about privacy than five years ago, with those from the region by far the most concerned about government surveillance. There was also an acknowledgement by all respondents that they’re not being given enough clear information about how their personal information will be used by IoT manufacturers.

On the plus side, Europeans appeared much more confident they have control over personal data they’ve willingly shared with companies (43%), than Japanese (30%) and American 22%) respondents.

The European dimension
One reason for the confidence Europeans have in control over certain aspects of their personal data could be the different legal and regulatory framework in place across the region. This might also account for heightened tensions over privacy. Put simply, Europeans have not been desensitised to privacy issues as many Americans have by mandatory breach notifications. This is coming soon with the new European Data Protection Regulation, although it’s unlikely to have much immediate impact.

Where the Regulation might hit IoT providers, however, is in the new principle of “privacy by design” – which will force manufacturers to ensure that all business processes for products and services be designed with data protection in mind. There’s also the rather ominous prospect for serious transgressors of the new EU-wide regulation of being fined up to 5% of global turnover.

What next?
Often in IT the commercial imperative to get products out on the market is the driving force behind everything, and it’s certainly no different in the burgeoning Internet of Things space. With a market estimated to be worth $7.1 trillion by 2020 (IDC), it’s perhaps no surprise that everyone wants to rush their products out before their competitors. But fail to understand and respect the significant privacy and security concerns of consumers in your region and you’re in danger of falling at the first hurdle.

With the insights gleaned from the report, here are a few recommendations for IoT firms:

  • Inform consumers how their personal data is used, what is collected and give them the option to opt-out
  • Reassure customers about the security of their information and explain how to erase collected information or disable a device if lost/stolen
  • Create and enforce privacy and security policies and raise employee awareness of the importance of user privacy
  • Consider the impact of upcoming European Data Protection Regulation to ensure any new products fall in line with the new laws



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