European Commission launches investigation into Internet of Things devices

Last month, the European Commission launched a sector inquiry into consumer products and services that use IoT (Internet of Things) technology.

The study is intended to identify potential data privacy issues and the possibility of organisations misusing information to gain a competitive advantage.

Approximately 400 organisations will be asked for information about the products they sell, how personal data is collected and used, and the extent to which different devices can share information.

What are IoT devices doing with your personal data?

The European Commission has expressed concern that the producers of IoT devices – such as virtual assistants and smart watches – are able to collect vast amounts of data that can be used to harm competition.

For example, devices often ignore products and services offered by competitors, instead directing users towards those owned by the device’s parent company or its preferred partners, limiting users’ choices in the process.

Discussing the investigation, the European Commission Executive Vice-President Margrethe Vestager noted the many benefits of IoT technology, but stressed that “access to large amounts of user data appears to be the key for success in this sector”.

As such, she said it was essential to make sure that “market players are not using their control over such data to distort competition, or otherwise close off these markets for competitors. This sector inquiry will help us better understand the nature and likely effects of the possible competition problems in this sector.”

The European Commission is inviting comments from organisations that sell IoT devices and those that offer products and services through these devices.

It plans to publish a preliminary report based on the answers in the spring of 2021, with the final report expected in the summer of 2022.

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