With the Internet of Things (IoT) every- where, can regulation be far behind?
How ICT regulators can enable IoT ecosystem development

The IoT ecosystem is expected to grow rapidly in the next few years, with mainstream deployment already prevalent across many vertical industries. Increased IoT penetration across use cases poses unique challenges for ICT policy-makers and regulators beyond traditional telecom-focused regulatory topics such as spectrum, numbering, and roaming. The complexity and scale of the IoT brings increased focus on elements such as the safety of various stakeholders, new business models, data security and privacy. Given the potential benefits of the IoT, growth can be accelerated, and some of the pitfalls are avoided at the same time by effectively involving other national departments and ministries in addition to telecom regulators.

1. The increasing prominence of the IoT

Telecom operators and regulators have historically focused on person-to-person (P2P) telecommunications services. But the IoT ecosystem involves interaction of telecommunications services with a range of new services and M2M communications. (See Figure 1). The IoT will enter into every aspect of our lives and our cities, as well as support all industries.

Figure 1: The Internet of Everything and Everyone

ICT service providers and leaders in their respective industries are accelerating their efforts to tap this potential.

2. The challenge for ICT regulators

IoT use cases blur traditional industry-specific boundaries (see Figure 2) and challenge governance of industry verticals by respective sector authorities (see Figure 3). In addition, success of the IoT is dependent on collection and use of data to provide customized solutions, which poses a significant threat to consumers’ data privacy and security. So there is an emerging trend to develop regulations which are case specific, as we have seen in the cases of drones and consumer data privacy protection. But these regulations are being developed independently. So far only New York State has issued a comprehensive IoT policy, which not only covers data privacy and security, but also plans to make information about IoT infrastructure public and share IoT infrastructure through public-private partnerships.

Accordingly, investors into the IoT ecosystem seek clarity on what is regulated or unregulated and permitted or prohibited. This situation makes it even more critical that policy-makers have holistic views for better management of the IoT ecosystem. ICT regulators are better placed to coordinate this cross-sector effort. In this document, we examine the regulatory challenges in developing a successful IoT ecosystem.

Figure 2: Enhanced role for ICT service providers