IoT Update: Flurry of Federal 5G Activity Indicates Important Growth Opportunities for the IoT Ecosystem

From the Federal Communications Commission (“FCC”) to Congress to the White House, the federal government has continued to push the importance of investment and innovation in fifth-generation (“5G”) wireless technology. This push bodes well for the many industries that rely on the Internet of Things (“IoT”), such as transportation, healthcare, and manufacturing—to name a few. As we have previously discussed, 5G deployment is critical for IoT because the IoT ecosystem will rely heavily on the increased speeds and capacity, as well as the reduced latency, that 5G technology will enable. Below we discuss the most recent pushes for 5G developments from federal leadership before surveying key industries in the IoT ecosystem that we expect to benefit from these efforts. Continue Reading

IoT Update: EU Commission Issues Recommendation on Cybersecurity in the Energy Sector

The European Commission (“Commission”) has published a Recommendation on cybersecurity in the energy sector (“Recommendation”). The Recommendation builds on recent EU legislation in this area, including the NIS Directive and EU Cybersecurity Act (see our posts here and here). It sets out guidance to achieve a higher level of cybersecurity taking into account specific characteristics of the energy sector, including the use of legacy technology and interdependent systems across borders.

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EDPB Begins Consultation on New Guidelines on Use of the “Performance of a Contract” GDPR Legal Basis by Online Services

On 9 April 2019, the European Data Protection Board (“EDPB”) adopted new guidelines “on the processing of personal data under Article 6(1)(b) GDPR in the context of the provision of online services to data subjects.”

In general, the GDPR requires that processing of personal data be justified under a legal basis in Article 6 GDPR.  One such legal basis is Article 6(1)(b), which covers data processing that is “necessary for the performance of a contract to which the data subject is party or in order to take steps at the request of the data subject prior to entering into a contract.”  The new EDPB guidelines consider the meaning of this basis, and in particular whether it can be used as the basis for data processing by online services for purposes such as service improvement, fraud prevention, targeted advertising, and service personalization. Continue Reading

FCC Warns Marketers of Video Streaming Devices to Comply with Device Authorization Rules

Earlier this month, the Federal Communications Commission (“FCC”) issued an Enforcement Advisory reminding manufacturers, importers, and retailers of video TV set-top boxes that stream Internet-based content to comply with FCC device authorization rules.  As the FCC noted in its Advisory, violations of these rules can lead to monetary penalties totaling more than $19,000 per day of violation or $147,000 for an ongoing violation.  The Advisory noted that to avoid these penalties, entities that manufacture, import, market or operate these set-top boxes should ensure that they comply with FCC device authorization rules.

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AI Update: EU High-Level Working Group Publishes Ethics Guidelines for Trustworthy AI

On April 8, 2019, the EU High-Level Expert Group on Artificial Intelligence (the “AI HLEG”) published its “Ethics Guidelines for Trustworthy AI” (the “guidance”).  This follows a stakeholder consultation on its draft guidelines published in December 2018 (the “draft guidance”) (see our previous blog post for more information on the draft guidance).  The guidance retains many of the same core elements of the draft guidance, but provides a more streamlined conceptual framework and elaborates further on some of the more nuanced aspects, such as on interaction with existing legislation and reconciling the tension between competing ethical requirements.

According to the European Commission’s Communication accompanying the guidance, the Commission will launch a piloting phase starting in June 2019 to collect more detailed feedback from stakeholders on how the guidance can be implemented, with a focus in particular on the assessment list set out in Chapter III.  The Commission plans to evaluate the workability and feasibility of the guidance by the end of 2019, and the AI HLEG will review and update the guidance in early 2020 based on the evaluation of feedback received during the piloting phase. Continue Reading

ICO opens beta phase of privacy “regulatory sandbox”

On 29 March 2019, the ICO opened the beta phase of the “regulatory sandbox” scheme (the “Sandbox”), which is a new service designed to support organizations that are developing innovative and beneficial projects that use personal data.  The application process for participating in the Sandbox is now open, and applications must be submitted to the ICO by noon on Friday 24 May 2019. The ICO has published on its website a Guide to the Sandbox, which explains the scheme in detail.

The purpose of the Sandbox is to support organizations that are developing innovative products and services using personal data and develop a shared understanding of what compliance looks like in particular innovative areas.  Organizations participating in the Sandbox are likely to benefit from having the opportunity to liaise directly with the regulator on innovative projects with complex data protection issues. The Sandbox will also be an opportunity for market leaders in innovative technologies to influence the ICO’s approach to certain use cases with challenging aspects of data protection compliance or where there is uncertainty about what compliance looks like. Continue Reading

IoT Update: How Smart Cities and Connected Cars May Benefit from Each Other

Innovative leaders worldwide are investing in technologies to transform their cities into smart cities—environments in which data collection and analysis is utilized to manage assets and resources efficiently.  Smart city technologies can improve safety, manage traffic and transportation systems, and save energy, as we discussed in a previous post.  One important aspect of a successful smart city will be ensuring infrastructure is in place to support new technologies.  Federal investment in infrastructure may accordingly benefit both smart cities and smart transportation, as explained in another post on connected and autonomous vehicles (“CAVs”).

Given the growing presence of CAVs in the U.S., and the legislative efforts surrounding them, CAVs are likely to play an important role in the future of smart cities.  This post explores how cities are already using smart transportation technologies and how CAV technologies fit into this landscape.  It also addresses the legal issues and practical challenges involved in developing smart transportation systems.  As CAVs and smart cities continue to develop, each technology can leverage the other’s advances and encourage the other’s deployment.

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AI Update: What Happens When a Computer Denies Your Insurance Coverage Claim?

Artificial intelligence is your new insurance claims agent. For years, insurance companies have used “InsurTech” AI to underwrite risk. But until recently, the use of AI in claims handling was only theoretical. No longer. The advent of AI claims handling creates new risks for policyholders, but it also creates new opportunities for resourceful policyholders to uncover bad faith and encourage insurers to live up to their side of the insurance contract.

Most readers are familiar with Lemonade, the InsurTech start-up that boasts a three-second AI claims review process. However, as noted in a Law360 article last year, Lemonade deferred any potential claim denials for human review, so the prospect of AI bad faith is still untested.  Now it is only a matter of time before insurers face pressure to use the available technology to deny claims as well.

So what happens when a claim is denied?

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Senate Reintroduces IoT Cybersecurity Improvement Act

On March 11, 2019, a bipartisan group of lawmakers including Sen. Mark Warner and Sen. Cory Gardner introduced the Internet of Things (IoT) Cybersecurity Improvement Act of 2019. The Act seeks “[t]o leverage Federal Government procurement power to encourage increased cybersecurity for Internet of Things devices.” In other words, this bill aims to shore up cybersecurity requirements for IoT devices purchased and used by the federal government, with the aim of affecting cybersecurity on IoT devices more broadly.

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Net Neutrality Update: House Hearing and Proposed Legislation

Since the Federal Communications Commission (“FCC”) repealed the 2015 net neutrality rules last year, federal and state lawmakers have debated how to address the issue of net neutrality going forward.  We previously have discussed some of the state net neutrality laws that were enacted, including California’s law, which currently is on hold pending the resolution of Mozilla Corp v. FCC, the lawsuit challenging the FCC’s order that repealed net neutrality rules.  Oral argument for this case was held in the U.S. Court of Appeals for the D.C. Circuit on February 1, 2019.

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