In tech circles, few topics have been generating more buzz of late than the Internet of Things (IoT), the projected surge of smart, networked devices that promises breakthrough improvements in sectors as diverse as healthcare and energy, transportation and agriculture.
But there's a catch.
The IoT may never realize its full potential unless the government takes a more active role in promoting the technology while abstaining from heavy-handed regulations that could curb innovation and product development in the field, according to a new report from the Center for Data Innovation, a think tank focusing on technology policy.
"There's a really interesting opportunity for the government to accelerate the deployment of these technologies," says Daniel Castro, the center's director. "There are some inherent market failures with IoT that the government has a role in addressing."
Castro says that IoT has been garnering increasing attention among policymakers, as evidenced by the stout attendance at an event his organization hosted on the issue this week on Capitol Hill.
Congressional Caucus on IoT to help define government role
In January, a bipartisan pair of lawmakers teamed to form the Congressional Caucus on IoT, which aims to serve as an educational and advocacy organization within the House of Representatives.
Still, confusion about the issue persists among members of Congress, who are still trying to figure out the proper role of government in shepherding along the IoT.
[ Related: Why CIOs should worry about the Internet of Things ]
"This is, I think, an idea that will have legs because the question I think a lot of members have is, we keep hearing about this but what should we do?" Castro says.
Castro's organization is calling for a concerted effort in the federal government to bring together the various agencies that have a role in the regulatory environment for IoT applications and develop a cohesive national strategy that would identify areas where the government could spur investment, innovation and adoption. Castro says he is "agnostic on where the momentum comes from" for such a strategy, but stresses that it must encompass a wide swath of the federal government, given that IoT devices and applications are cropping up in industries across the regulatory spectrum.
"You have to have agencies starting to think about this, and right now they're not," he says. "The problem is you don't want all these agencies to come to different conclusions."
Call for government officials to use policies to facilitate IoT growth
In addition to harmonizing the regulatory environment, Castro's organization is calling on U.S. and foreign government officials to pursue policies to facilitate IoT growth, including targeted research and development spending and programs to encourage technical training in areas like data science, where an influx of skilled workers could help glean value from the data collected and produced by the billions of devices expected to come online in the next several years.
While the Center for Data Innovation report anticipates that the private sector will be the primary driver of innovation and development in the IoT over time, it notes that there is hesitation among many firms to dive headlong into the field owing to concerns over the risks of not being able to recoup investment in the nascent technology. In that regard, the center is suggesting that the government could position itself as an early adopter, deploying IoT devices and applications in its own facilities and in the sectors where it plays a dominant role, such as defense, transportation and energy.
Castro also sees a role for the government to play in expanding deployment of the infrastructure that supports IoT -- and ensuring universal access to it -- to prevent a new type of digital divide from taking hold.
Part of that policy framework would include additional steps to ensure that sufficient wireless spectrum to support the data exchange among devices is available, acknowledging that for some applications -- say monitoring and reporting soil or crop conditions in rural farm communities -- short-range technology like Wi-Fi would not be a good fit.
Global officials could also help the IoT by moving away from policies that create barriers for data to flow across political borders, a long-simmering complaint among U.S. cloud computing companies.
"Whether you're talking about a smart transportation system or an agricultural business where you're comparing different climate zones, you want to be able to take data from different parts of the world and conduct analysis on it, and that's not possible unless you can move data across borders," Castro says.
Castro envisions a national IoT strategy that would generally hew to "light-touch" regulations, particularly in areas like privacy, where he says overly prescriptive mandates could curb growth. Many of the sensors and other devices that would comprise IoT, he points out, do not have traditional consumer interfaces like websites and mobile apps, where the checkbox, notice-and-consent approach to privacy and data collection is broadly applied.
The young companies that are sprouting up around different facets of IoT can ill afford to navigate a thicket of regulations that would invite a host of new compliance burdens and potentially limit the value of the technology, Castro argues.
"If there's not a concrete harm we see today, let's hold off," he says. "It's really hard to be a startup and also spend all your time in Washington."