In August, four US Senators introduced a bill designed to improve Internet of Things (IoT) security. The IoT Cybersecurity Improvement Act of 2017 is a modest piece of legislation. It doesn't regulate the IoT market. It doesn't single out any industries for particular attention, or force any companies to do anything. It doesn't even modify the liability laws for embedded software. Companies can continue to sell IoT devices with whatever lousy security they want.
What the bill does do is leverage the government's buying power to nudge the market: any IoT product that the government buys must meet minimum security standards...
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But the situation is critical. The Internet is dangerous -- and the IoT gives it not just eyes and ears, but also hands and feet. Security vulnerabilities, exploits, and attacks that once affected only bits and bytes now affect flesh and blood.
Markets, as we've repeatedly learned over the past century, are terrible mechanisms for improving the safety of products and services. It was true for automobile, food, restaurant, airplane, fire, and financial-instrument safety. The reasons are complicated, but basically, sellers don't compete on safety features because buyers can't efficiently differentiate products based on safety considerations. The race-to-the-bottom mechanism that markets use to minimize prices also minimizes quality. Without government intervention, the IoT remains dangerously insecure.
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Sometimes we can opt out of the IoT, but that option is becoming increasingly rare. Last year, I tried and failed to purchase a new car without an Internet connection. In a few years, it's going to be nearly impossible to not be multiply connected to the IoT. And our biggest IoT security risks will stem not from devices we have a market relationship with, but from everyone else's cars, cameras, routers, drones, and so on.
