The Internet of Things (IoT) offers consumers convenience, efficiency, collaboration and expanded products and services, but concerns about privacy and data security pose major challenges to the industry. Identity theft, invasive data mining, cyber-terrorism, and physical dangers from hacked devices scare consumers; the industry must safeguard consumers and the data that is an extension of them. Essentially, with big data comes big responsibility.

The Internet connectivity that generates so much functionality and value in the IoT ecosystem also creates myriad points of vulnerability that no single entity can manage. Consumers increasingly express security concerns that differ by the context of interaction. Parks Associates consumer data reveals:

• Approximately 50% of broadband households have privacy or security concerns about smart home devices.
• “Identity or data theft by hackers” is the first or second leading privacy concern in 8 of 9 product categories surveyed.
• A combination of privacy rights can relieve up to 74% of privacy concerns.

Privacy advocates and public policy makers are bringing soft regulatory pressure on the market, at least so far. Companies seek to balance the risks and rewards of a deepening investment in security and big data analysis. While most companies continue to frame data security largely as a risk management issue, others think more positively about data security as a means to enhance business agility.

Ultimately, the success of the IoT will be influenced significantly by the degree to which all players balance security concerns vis à vis other priorities, and by how well vulnerabilities are mediated by new security technologies, standards, and best practices.  

Parks Associates analyzes key trends concerning privacy and security in the IoT in the industry report Privacy and Big Data: Safeguarding Consumers. For more information, click here.

Further Reading:

• Key Competitive Elements for Smart Home Service Providers
• Privacy Concerns about the Smart Home
• The Internet of Things Promises Opportunities & Risks for Industry Players