Navigant Research Blog

Organizations Work to Combat Security and Interoperability Concerns Surrounding IoT

— November 21, 2017

According to Navigant Research’s new IoT for Lighting report, global market revenue for Internet of Things (IoT) lighting is expected to grow from $651.1 million in 2017 to $4.5 billion in 2026. With the growing number of connected devices and plethora of continual new data generation, data security is a top concern. It is seen as a barrier to adoption for IoT lighting and other IoT technologies within the commercial building space. However, despite the challenges surrounding security, there are organizations that are working to improve security and address other key concerns, such as interoperability.

Addressing Security Concerns

A non-profit, the IoT Security Foundation (IoTSF) aims to make it secure to connect the growing number of connected devices so the benefits of IoT can be realized. In September 2017, IoTSF announced a Smart Buildings Working Group. The key function of the group will be to establish comprehensive guidelines to help each supply chain participant specify, procure, install, integrate, operate, and maintain IoT security in buildings. Intelligent building equipment and controls such as lighting, HVAC, fire, building security, and audiovisual will be included.

The Smart Buildings Working Group, though in its infancy, has already received positive feedback and responses to partnership requests from technology firms. Lighting vendors are starting to express interest, as well. The growing list of partners and participants includes Oracle, Honeywell, and global engineering firm Norman Disney & Young.

Fighting Interoperability

Many IoT lighting systems and lighting control systems are proprietary or modified versions of standards, such as ZigBee. Some customers prefer proprietary systems, as this can simplify discussion over a responsible party for any possible system malfunctions. However, for many, this leads to confusion around which systems to purchase and to fear that components or an entire system might become obsolete. Additionally, this limits coordinated controls within a smart building and can limit the idea of holistic operations within a building.

There are groups, such as the IoT Ready Alliance and the DesignLights Consortium (DLC), working to address interoperability for IoT lighting and other IoT devices. The vision of the IoT Ready Alliance is interoperability and future-proofing of lighting products and services. By helping to expand the number of products that are IoT ready, consumers are not required to make the decision right away. This essentially helps in future-proofing lighting in a time where continued technology advancements can make the decision to upgrade to an advanced lighting system difficult.

The DLC is also helping to drive the widespread adoption networked lighting controls through its Networked Lighting Controls Specification program by providing tools and resources for utilities, energy efficiency programs, and the lighting industry.

Marching Forward

While there are organizations to address these barriers to widespread adoption, the fight to combat security and interoperability concerns within the commercial lighting market and the broader IoT space has just begun. Organizations such as IoTSF, DLC, and IoT Ready Alliance, while making progress, cannot combat these issues alone.

Industry players from lighting manufacturers to startups to tech firms will need to provide support and partnerships for these organizations in order to achieve an optimal outcome. Although initial feedback to these organizations and their work is reassuring and a step in the right direction, time will determine the full support and true success of these programs.

 

Digital Assistants Are a Stepping Stone for Artificial Intelligence in the Home

— November 21, 2017

Artificial intelligence (AI) is gaining hype and capturing headlines about its futuristic possibilities. Popular media, like Blade Runner 2049, depicts AI as a technology powering human-like robots with capabilities for taking over the world. In reality, AI is here, and it is already used in everyday lives. Today, AI is enabling ridesharing applications like Lyft and Uber, autopilot in commercial flights, mobile check deposits, online shopping, and more. The technology is making significant progress across a variety of markets and is spreading to the smart home.

The home is abundant with opportunities to automate tasks and create more personal experiences with technology. AI can be used to enhance solutions that help consumers better understand and manage energy consumption and keep homes safer and more secure. Also, it creates more intelligent and intuitive home automation by studying patterns of human behavior to operate the home more efficiently.

The Digital Assistant

One obvious way in which AI is spreading through the home is digital assistants. Digital assistants, or virtual assistants, are the human-like user interface embodying AI software and cloud services. They are fundamentally changing the way users interact with technology by creating an easy-to-use, hands-free, and conversational experience via voice activation. They also represent a platform that converges devices, data, services, computing power, and the internet to better understand and anticipate consumer needs. While the novelty of using digital assistants is driving adoption and market growth (try playing Jeopardy with Alexa), this technology has powerful implications. Many companies recognize this potential, and large tech incumbents like Amazon, Google, Apple, Samsung, and Microsoft are quickly and heavily investing in AI and digital assistants for the home.

Though digital assistants promise market disruption and a fundamental shift in the use of technology, it is important to stay realistic about AI in the home. Some would argue that traditionally defined AI does not even exist in the home—they would argue it’s all just analytics and algorithms. Others would argue that this is the reality of AI—it isn’t glamorous, it’s about automating tasks and identifying behavioral trends to make our lives more comfortable, convenient, and efficient. How this technology will play out—whether it will be a benevolent and revolutionary technology or whether it will become an existential threat to human existence—remains to be seen. For now, AI is having an impact in the home in the form of digital assistants. Check out Navigant Research’s upcoming Digital Assistants and AI in the Home report for more information.

 

Cybersecurity Threats Mount, but Overall Picture Not So Bleak

— November 16, 2017

Cybersecurity threats keep mounting against the grid, corporations, and individuals. The known attacks and security holes revealed in the past year are real and cause for serious concern. The whole picture, however, might not be as bleak as it first appears if utilities focus on getting ahead of cybersecurity threats. The good guys are in this fight and they have solid tools to keep us safe. Among grid-related threats, at least three incidents stand out as examples of how grim the situation could become if utilities do not proactively address cyber attacks.

It was revealed in August that a foreign power had compromised the state-owned Irish power grid company EirGrid, according to a report by Ireland’s Independent newspaper. When the hack was first discovered, experts said the breach occurred more than 2 months beforehand. At the time, the newspaper’s sources said it was still unknown if any malicious software had made its way into EirGrid’s control systems. Though it is unclear which foreign power was involved, the hackers used Internet Protocol (IP) addresses sourced from Ghana and Bulgaria.

In July, US officials revealed that hackers had penetrated computer networks of companies operating nuclear power stations, other energy facilities, and manufacturing plants. Wolf Creek Nuclear Operating Corp.’s power plant near Burlington, Kansas is one of the nuclear facilities specifically named. The nefarious activity caused the US Department of Homeland Security and the US Federal Bureau of Investigation to issue an amber warning, which is the second-highest rating level. It turns out the hackers were unable to hop from victims’ computers into control systems, and officials said there was no sign of a threat to public safety.

In mid-October, millions of people found out that nearly all Wi-Fi devices were at risk of hijack and eavesdropping because of a bug known as KRACK that exposes a flaw in the common security protocol WPA2. If exploited, a hacker could use a skeleton key to access any WPA2 network without a password. Patches for thwarting the threat have been made available from some vendors, while others are still pending.

Grid Cybersecurity

So, how high are the overall risks? Potentially rather high, but perhaps not as high as one might think for the grid in particular. According to Philip Propes, chief security information officer for the Tennessee Valley Authority (TVA), the situation is not doom and gloom in the electric utility sector. During a recent webinar, he said officials in the utility industry are well aware of cybersecurity issues and many have taken appropriate steps. In TVA’s own case, he says his team is moving from a reactive approach to a proactive approach around security and getting ahead of attacks before an event occurs.

Furthermore, private experts and researchers at the US Department of Energy’s national labs are working on new methods to reduce the threat from cyber attacks. One project at Oak Ridge National Laboratory would set up a private communications and control system for the grid, called darknet, that would operate separately from the public internet. Also, the use of quantum encryption capabilities could add enhanced security for the grid.

Cybersecurity risks should not be taken lightly, but there is no reason to panic. There is a growing sense of urgency among experts and officials to collaborate on robust solutions and progress is being made quietly, despite the mounting threats. For a more in-depth look at how utilities are responding to these threats, check out Navigant Research’s Cybersecurity for the Digital Utility report, written by my colleague Michael Kelly.

 

Cities and Businesses Care about Smart Buildings: Part 2

— November 14, 2017

With 238 proposals in hand from cities and regions across North America vying to host its second headquarters, Amazon plans to make a decision next year. Cities trying to lure Amazon should turn this occasion into an opportunity to strengthen their business environments to both complement and drive investment in smart buildings.

Regulatory Certainty and Standardization of Business

In order to attract investment in smart buildings, governments should work toward offering certainty and standardization for investors. Certainty refers to predictable outcomes or guaranteed returns. Governments can establish policies that set expectations for the building sector. Cities that adopt and enforce building energy codes, for example, can quickly increase local demand for energy efficiency technology. Stable demand means a stable market for finance.

In addition, having common standards for assessing risks will be helpful. For example, many stakeholders are already familiar with existing green building standards like Leadership in Energy and Environmental Design (LEED). If governments use policies such as financial incentives to encourage broader adoption of such standards, that will make it easier for investors to assess a project and ultimately increase the likelihood of investment.

Leading by Example

As a start, enforcing policies like building efficiency codes and fostering voluntary programs to pursue LEED certification can offer certainty and standardization. Cities can lead by example, ensuring that their own buildings adhere to the policy goals, unleashing the power of information and communication technology in public buildings. In its recent report, Smart Buildings and Smart Cities, Navigant Research expects the global smart public buildings market revenue to grow from $3.6 billion in 2017 to $10.2 billion by 2026 at a compound annual growth rate of 12.1%.

One of the leaders in this area is Washington, DC, which was named the first LEED for Cities Platinum city in the world in August 2017. Washington, DC requires all new public sector buildings to achieve a minimum of LEED Silver certification. And starting in 2012, all new private buildings over 50,000 square feet were required to achieve LEED certification. Once the regulations kicked in, the private sector responded by competing for LEED certifications—developers wanted to achieve higher levels of certification against their competitors.

Regulatory certainty and standardization of business together with government efforts to lead by example are key to encouraging investment in the smart buildings sector. As stated in my previous blog, cities wishing to remain competitive in the face of new emerging technologies and a new generation of top talent will want smart buildings as an action item.

 

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