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Kicking the Smart Tires on IoT Legislation

Kicking the Smart Tires on IoT Legislation

May 23, 2018

This article is co-authored by Paul Coyle, Megan Brown, and Shawn Chang

On May 22, 2018, the House Energy & Commerce Committee’s Subcommittee on Digital Commerce and Consumer Protection convened a hearing titled “Internet of Things Legislation.” The hearing enabled members of the Subcommittee to gather input from industry and consumer advocacy representatives on a discussion draft of the State of Modern Application, Research, and Trends of IoT Act (the “SMART IoT Act”). The SMART IoT Act would direct the Secretary of Commerce to conduct a study and submit to Congress a report on the state of the internet-connected devices industry in the United States.[1]

Energy & Commerce Committee Groundwork

The spread of broadband and coming 5G has set the stage for a vast network of interactive internet-connected (smart) devices than can transmit and receive data. These smart devices are being incorporated into all types of consumer and industrial products and applications.

Because IoT sensors can be embedded in all types of devices, the federal government faces a unique challenge. The Energy & Commerce Committee has been monitoring the emergence of IoT and Members are mindful that legislating might impede innovations, economic growth, and job creation.

The SMART IoT Act comes after two years of Committee hearings in which policymakers gathered information from inventors, technologists, large and small businesses, and consumer advocates.[2] This legislation is a product of the bipartisan Internet of Things Working Group founded in 2016 by Representatives Bob Latta (R-Ohio) and Peter Welch (D-Vermont).[3]

The SMART IoT Act Discussion Draft

The SMART IoT Act would require the Department of Commerce to conduct a comprehensive survey of the IoT ecosystem through outreach to private sector and across federal agencies.[4]

The survey of private sector IoT activity would result in comprehensive lists of industry sectors that develop smart devices and sectors that use smart devices.  Additionally, the study would identify public-private partnerships that are focused on IoT as well as private sector entities that are developing standards. The study would also describe the ways these entities develop and use IoT devices.

In addition, the SMART IoT Act would require the Commerce Department to form a comprehensive list of the federal agencies with jurisdiction over the entities developing or using IoT devices and entities developing standards for IoT. The survey would identify the federal agencies and entities that the IoT industry interacts with, and all interagency activities and coordination, including working groups.

The survey would identify all policies, regulations and standards implemented by each federal agency as well as industry groups. Finally, the survey would identify federal government resources available for consumers and small businesses to evaluate internet-connected devices.

Witness Testimony

The IoT legislation hearing featured testimony of Tim Day of the U.S. Chamber of Commerce’s Chamber Technology Engagement Center, Michelle Richardson of the Center for Democracy and Technology’s Freedom, Security, and Technology Project, and Dipti Vachani of Intel Corporation’s Internet of Things Group.

Mr. Day’s testimony represented the view of large and small technology businesses that are looking to Congress for policy that drives economic growth and innovation and creates jobs. Mr. Day supported the SMART IoT Act.  Ms. Richardson’s testimony encouraged policymakers to prioritize privacy legislation and protect consumers from intrusive and manipulative uses of personal data collected by IoT devices. Ms. Vachani explained how her company is developing major IoT solutions within healthcare, urban planning, and transportation and she advocated for broadband deployment and a national IoT plan that would support international standards.

Legislative Goals

The Subcommittee members view the SMART IoT Act as a starting point for federal engagement with IoT.

Subcommittee Chairman Bob Latta said he believes this legislation is necessary to identify and eliminate duplicative agency work, ensure efficient use of government resources, and to understand how stakeholders are addressing privacy and data security. In addition, he would like to ensure that the environment for innovation in the U.S. remains a priority.

Subcommittee Ranking Member Jan Schakowsky (D-Illinois) said the hearing marks the Subcommittee’s transition from general discussion of IoT to active legislation. She called for bipartisan solutions to privacy and cybersecurity issues as millions of IoT devices enter the market. She will work to pass the SMART IoT Act and then turn attention to consumer protection issues and strategic investments that would promote innovation.

Energy & Commerce Committee Chairman Greg Walden (R-Oregon) said this bipartisan effort underscores the Committee’s priority to help businesses expand, to create jobs, and to help improve the lives of Americans. Chairman Walden said the SMART IoT Act is meant to provide stakeholders with the first compendium of who is doing what in the IoT space.

Energy & Commerce Committee Ranking Member Frank Pallone (D-New Jersey) said the report required by the SMART IoT Act will provide a one-stop source of how businesses are integrating connectivity and how the government is helping companies adapt to connectivity. In addition, he said federal agencies and departments can use the report to coordinate their work. Pallone said he would support the addition of a provision to address cybersecurity in the SMART IoT Act. But whether it’s part of the study or not, he said Congress must act to ensure that strong cybersecurity and data security are fundamental.

Many Members, including Rep. Peter Welch, noted the need for ubiquitous broadband to yield IoT benefits, and he said Congressional efforts in the IoT space will be truly successful only if broadband is deployed in rural America.

Next Steps in the 115th Congress

The tenor and tone of the hearing on the SMART IoT Act discussion draft indicates broad bipartisan support within the Subcommittee on Digital Commerce and Consumer Protection. As we approach midterm elections, House Leadership may look to pass this bill as a refreshing bipartisan achievement.

Beyond the SMART IoT Act, the SELF DRIVE Act and the DIGIT Act are two additional bills to watch in the final stretch of the 115th Congress.

In 2017, the House passed the SELF DRIVE Act, which encourages testing and deployment of highly automated vehicles. During the SMART IoT hearing, Chairman Walden noted his interest in the Senate passing the SELF DRIVE Act.

The DIGIT Act, on the other hand, was passed by the Senate in 2017 and awaits house action. Tim Day emphasized the Chamber of Commerce’s support for the DIGIT Act during the hearing. This bill would require the Department of Commerce to assemble a working group of federal stakeholders to provide recommendations and a report to Congress. The DIGIT Act would also establish a steering committee comprised of private industry stakeholders to advise the federal working group. Finally, the Act directs the FCC to submit recommendations concerning the IoT’s current and future licensed and unlicensed spectrum needs.

The SMART IoT Act and the Subcommittee on Digital Commerce and Consumer Protection’s hearing illustrate thoughtful steps toward a comprehensive federal IoT strategy that will promote the growing IoT sector.

 

[1] State of Modern Application, Research, and Trends of IoT Act, H.R. ___, 115th Cong. (2018).

[2] Opening Statement of Chairman Bob Latta: Hearing on Internet of Things Legislation Before the Commerce Subcomm. on Dig. Commerce and Consumer Protection of the H. Comm. on Energy & Commerce, 115th Cong. (2018), https://docs.house.gov/meetings/IF/IF17/20180522/108341/HHRG-115-IF17-MState-L000566-20180522.pdf.

[3] Press Release, H. Energy & Commerce Comm., Latta and Welch Launch Bipartisan Internet of Things Working Group (May 24, 2016), https://energycommerce.house.gov/news/press-release/latta-and-welch-launch-bipartisan-internet-things-working-group/.

[4] State of Modern Application, Research, and Trends of IoT Act, H.R. ___, 115th Cong. (2018).

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