The Government Reveals Its 3 Biggest Concerns About The Internet of Things

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Intel's AIM Suite can identify gender and approximate age of consumers. Source: Intel.

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Technological optimism is buzzing at the Consumer Electronics Show this week. Prototypes of autonomous cars, wearable technology, and Internet of Things innovations are taking center stage. But not everyone is sold on the coming IoT utopia.

Federal Trade Commission Chairwoman, Edith Ramirez, laid out three main concerns facing the Internet of Things in her CES keynote, and what companies can do to stave off the risks of connecting billions of formerly unconnected things to the Internet.

1. Ubiquitous data collection
In her speech, Ramirez said:

In the not too distant future, many, if not most, aspects of our everyday lives will leave a digital trail. That data trove will contain a wealth of revealing information that, when patched together, will present a deeply personal and startlingly complete picture of each of us -- one that includes details about our financial circumstances, our health, our religious preferences, and our family and friends.

That sounds like a real IoT buzzkill, but it's in lockstep with somebear cases for the Internet of Things. Ramirez suggests thwarting the over-collection of data by having companies agree to only collecting the data they need and keeping it anonymous as much as possible.

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Intel's already done some of this for its customers in the retail industry. The chipmaker's Audience Impression Metric Suite lets retail companies suggest products to customers on their devices while inside stores, while protecting privacy at the same time.

"The potential applications in retail are limitless. But these new solutions will only succeed if shoppers know that their privacy is being protected as they engage with the technology," Intel said in a blog post. The company keeps all customer information anonymous and doesn't stops recording after they leave the store.

2.Unintended data use
Aside from collecting too much data, Ramirez is concerned about the data's unintended use as well:

Will the data be used solely to provide services to consumers? Or will the information flowing in from our smart cars, smart devices, and smart cities just swell the ocean of "big data," which could allow information to be used in ways that are inconsistent with consumers' expectations or relationship with a company?


Autonomous and semi-autonomous vehicles need to be protected from hacking too. Source: NHTSA.

To fix this, she said companies need clear data usage policies and to provide customers with opt-in data choices. "In these and similar cases, consumers should be given clear and simple notice of the proposed uses of their data and a way to consent. This means notice and choice outside of lengthy privacy policies and terms of use,"Ramirez said.

Tech companies know this as well. One of the biggest proponents of the Internet of Things, Cisco Systems , had this to say said in a blog post a few months back:

Clearly, there are many questions that still need to be answered -- such as how a company provides for notice and consent in a device that doesn't have a direct user interface. But in general, it appears that the architecture for protecting IoT consumer data will follow the format of current regulatory regimes for data privacy and security overall.

At the end of the post, the blog's author recommended FTC regulation will likely keep companies in line with consumer privacy concerns.

3. Security, security, security
The last (yet equally as important) point Ramirez made was on Internet of Things security:

And, as we purchase more smart devices, they increase the number of entry points an intruder could exploit to launch attacks on or from. Moreover, the risks that unauthorized access create intensify as we adopt more and more devices linked to our physical safety, such as our cars, medical care, and homes.

Source: Source:Piktochart.

Ramirez noted that some developers creating IoT devices haven't spent decades thinking about security like hardware and software companies have.

But both Cisco and Intel both have IoT security solutions, and Cisco's sponsored security challenges awarding money to companies that come up with new security protocols. It would seem the bigger problem lies with smaller companies that don't have the time and resources to build security measures into cheap IoT connections.

Ramirez suggested companies set up password requirements for IoT tech, encrypt sensitive data, and monitor and patch data vulnerabilities when possible.

All of the chairwoman's concerns and suggestions are not beyond reason. The possibilities the IoT brings need to be balanced with ever-present privacy and security hurdles. To make it work, it'll take both federal regulation and cooperation from even the smallest tech companies to take these potential problems seriously.

The article The Government Reveals Its 3 Biggest Concerns About The Internet of Things originally appeared on Fool.com.

Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Cisco Systems and Intel. The Motley Fool owns shares of Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.