Report Recognizes Rapid Growth of Connected Devices Offers Societal Benefits, But Also Risks That Could Undermine Consumer Confidence

In a detailed report on the Internet of Things, released today, the staff of the Federal Trade Commission recommend a series of concrete steps that businesses can take to enhance and protect consumers’ privacy and security, as Americans start to reap the benefits from a growing world of Internet-connected devices. The Internet of Things is already impacting the daily lives of millions of Americans through the adoption of health and fitness monitors, home security devices, connected cars and household appliances, among other applications. Such devices offer the potential for improved health-monitoring, safer highways, and more efficient home energy use, among other potential benefits. However, the FTC report also notes that connected devices raise numerous privacy and security concerns that could undermine consumer confidence. “The only way for the Internet of Things to reach its full potential for innovation is with the trust of American consumers,” said FTC Chairwoman Edith Ramirez. “We believe that by adopting the best practices we’ve laid out, businesses will be better able to provide consumers the protections they want and allow the benefits of the Internet of Things to be fully realized.” The Internet of Things universe is expanding quickly, and there are now over 25 billion connected devices in use worldwide, with that number set to rise significantly as consumer goods companies, auto manufacturers, healthcare providers, and other businesses continue to invest in connected devices, according to data cited in the report. The report is partly based on input from leading technologists and academics, industry representatives, consumer advocates and others who participated in the FTC’s Internet of Things workshop held in Washington D.C. on Nov. 19, 2013, as well as those who submitted public comments to the Commission. Staff defined the Internet of Things as devices or sensors – other than computers, smartphones, or tablets – that connect, store or transmit information with or between each other via the Internet. The scope of the report is limited to IoT devices that are sold to or used by consumers.”

• The Internet of Things – Privacy & Security in a Connected World