The European Commission is considering a comprehensive plan to support the growing connectivity between machines, but may settle for a more targeted initiative as part of its Digital Single Market strategy, EURACTIV has learned.
Commission officials acknowledge that the executive has been relatively silent since it published a study on the Internet of Things last year.
Thibaut Kleiner, head of unit for Network Technologies, said the Commission is considering now whether a specific piece of legislation is needed to address this fast-growing sector, or whether it would be sufficient to add elements to legislative plans already in the pipeline, like the Digital Single Market (DSM).
“It is a very timely discussion” Kleiner told a panel discussion on Thursday (26 November).
Speaking to EURACTIV, Kleiner said he expected a decision on the best approach by early next year, and to issue a document, probably in the form of a communication, by the summer of 2016.
The key areas the Commission will look into are the free flow of data, standardisation, data protection, telecommunications, and the authentication of objects.
The DSM already addresses some of these elements, such as standardisation. Meanwhile, data protection and privacy, one of the most controversial issues, is being dealt with by the updated data protection regulation currently being negotiated by the European Parliament and Council.
Privacy by design
Privacy could be one of the main barriers to the development of the Internet of Things, according to the the Alliance for Internet of Things Innovation (AIOTI), a broad coalition of companies and sectoral organisations brought together by the Commission.
This 200-member group recommended adopting the principle of ‘privacy by design’. According to this concept, the protection of privacy is embedded upfront into the design specifications of technologies, networks and physical infrastructures.
This approach would be key for the development of the Internet of Things, stressed Robert MacDougall, from Vodafone who chairs the AIOTI Policy working group. He cited connected cars as an example where privacy by design works.
Kleiner explained that the “strong guiding principle” of the upcoming data protection regulation is “to make life easier” for all the stakeholders involved. Companies would need only to comply with a single European regulation instead of having to pass through numerous interfaces of national data privacy requirements.
Kleiner said the Commission will issue a set of guidelines for companies on how to comply with EU rules when applying the ‘privacy by design’ concept. But this can only happen once the data protection regulation is adopted, possibly by the end of this year.
Critics say ‘privacy by design’ is a vague concept that leaves privacy issues almost entirely in the private sector’s hands.
Sebastian Ziegler, president of the Internet of Things Forum, emphasised that “for the first time” the EU’s legal obligations on data privacy will have a global scope affecting non-European companies.
Ziegler called on policymakers to be “creative” in balancing citizen’s privacy concerns with the need to maintain a free flow of data enabling the Internet of Things.
“There is a need for research to come up with solutions for privacy”?for example for smart cities, he said. He agreed that data privacy is a key challenge, but also an opportunty for those able to develop practical solutions.
Industry sources say striking the right balance will be crucial to pave the way for a “truly horizontal” Internet of Things which applies seamlessly accross different domains instead of operating in silos.
Cornelia Kutterer, policy director at Microsoft for the EMEA region said that while the European Commission has led the discussion of internet of things from the connectivity perspective, what it is really about is data analytics. In her view, some of the policy priorities are the data protection, the privacy intrusion, the security in terms of the identification process, data ownership, liability (for devices and algorithms) and net neutrality.
A Huawei spokesperson named as a key area for policy action the connected cars. In particular, who will be in charge of the spectrum, as it remains unclear whether it will be in the manufacturers’ hands or instead the telecom firms. “This requires a clear policy response”, the spokesperson added.
“The Digital Single Market alone is not sufficient to foster a digitised production in Europe. It is vital that the Commission now undertakes further steps to create a single market for Industry 4.0," says Holger Kunze from the German mechanical engineering federation VDMA. “However, it will be decisive that the EU does not focus on the protection of consumer data alone. We will also need a debate on the use of data created by machines in digitised production processes."
The Internet of Things represents the next step towards the digitisation of society and economy, where objects and people are interconnected through communication networks and report about their status and/or the surrounding environment.
According to a recent European Commission study, the market value of connecting devices in the EU is expected to exceed one trillion euros in 2020, compared to 307 billion in 2013. The number of connections within the EU28 will increase from approximately 1.8 billion in 2013 (the base year) to almost six billion in 2020.
The study found investment programs or initiatives in this field in 13 member states. Germany, Netherlands, Sweden and the United Kingdom appear to lead in terms of capability (investment growth, ICT diffusion, Government support) and other initiatives related to the Internet of Things.
- Early 2016: Expected date for the adoption of the new data protection regulation.
- Summer 2016: Communication on the Internet of Things.