Examining Europe's Policy Options to Foster Development of the 'Internet of Things'


The Internet of Things (IoT) builds out from today's internet by creating a pervasive and self-organizing network of connected, identifiable and addressable physical objects, enabling application development in key vertical sectors through the use of embedded chips, sensors, actuators and low-cost miniaturisation.

The IoT is developing rapidly, challenging assumptions underlying the future Internet business, market, policy, and societal models. Connecting billions of objects to facilitate smarter living, the IoT may help us address global and societal challenges, making Europe a sustainable and inclusive economy. However, IoT-driven "smart meters," grids, homes, cities and transportation systems also raise some important issues that will need to be addressed.


The European Commission asked RAND Europe to help it devise a European policy approach for IoT. The research team assessed the current state of play, as well as probable developments in the medium term, from a technological, economic and policy point of view, both inside and outside the EU (in particular in China, Japan, and the United States).

The study provides an assessment of policy challenges to be addressed by policymakers in a mid- and longer-term perspective. It assesses to what extent the various issues raised by the IoT are addressed by EU policy tools (not limited to regulation but also including research and innovation policy, standardisation, etc.) and identifies possible gaps. The research team also assessed policy options to stimulate the development of the IoT in a way that best supports Europe's growth and jobs objectives and contributes to addressing societal challenges, while ensuring trust and security, including the respect of fundamental rights.

Findings & Recommendations

The information necessary to track the development of the IoT is fragmented and difficult to use. This problem of too much, too little and the wrong kind of information may account for slow progress to date. Rapid changes are expected to continue. In order to develop and implement appropriate flexible and future-proof policy this problem must be overcome.

  • The European Commission should take a central role in coordinating policy dialogue to ensure common understanding and coherent effective action across sectors, regions and policy areas.
  • The Commission should support meaningful digital literacy programmes and awareness-raising to empower self-regulation and improve individual interaction with the IoT.
  • The Commission should support and promote knowledge sharing, research and validation projects with funding, continuous debate and policy articulation especially on identification, privacy and ethics in IoT environments.
  • Although an ethical charter may be a useful component of self-regulation, support for the general approach is patchy. As an interim measure, creating a European ‘Ethical Tech’ brand could encourage innovators and providers to develop ethical technology in line with market and user needs.

Research Team

Helen Rebecca Schindler, principal investigator
Jonathan Cave
Salil Gunashekar
Petal Jean Hackett
Veronika Horvath
Neil Robinson