Image demonstrating connectivity for IoT, Internet of Things

Internet of Things and Smart Buildings

Creating solutions or problems?

“Internet of Things” (IoT) is a buzz word of the hour. But what does it mean? Essentially, IoT describes connectivity between humans and machines and machines and machines. It allows objects, typically referred to as “smart devices”, to talk and interact with each other via the internet to improve the way we work and live.

What’s the internet of things?

One area of our lives that is currently being impacted by the IoT is commercial buildings. Now referred to as “smart buildings”, these spaces utilise IoT capabilities to manage and control things such as lighting, temperature and security systems.

Imagine your fridge automatically ordering milk when your milk supplies reach a pre-determined level. Imagine being able to set the office temperature before arriving into work on a cold day or having the office coffee machine make you a morning latte as you park your car, all from the convenience of your smartphone.

What’s the issue?

Whilst this new wave of technology will aim to make our lives easier, more comfortable and efficient, it brings issues for the law to catch up with. These include:

  • When a smart building is sold – how does the buyer ensure that the vendor doesn’t retain access to the IoT network following settlement? No buyer wants the old owner to control their security system, office thermostat or lights.
  • When an employee resigns – how does the employer ensure that the employee no longer has access to the IoT network login details?
  • How do smart building owners protect their privacy and device security from hackers gaining access to the IoT network and causing havoc?

These are just a snapshot of potential challenges that IoT could bring in an environment where technology advances at a quicker pace than the laws required to manage it.

Potential solutions

One potential solution is to update contracts to address these advances in technology. For example:

  • in property contracts, special conditions could be added expanding the obligations on the vendor to provide all necessary keys and access codes for the building including IoT network login details and to remove all IoT controls from their devices (e.g. delete application on smartphone) following settlement. The buyer could then update the IoT network login details following settlement to prevent the vendor from gaining future access.
  • in employment contracts, additional terms could be included compelling employees, who resign or are terminated, to return IoT network login details and destroy any IoT access information in their possession when they leave. Another practical option may be to create separate login controls for each employee, which could then allow that user’s access details to be removed from the IoT system, without a need to update all passwords every time an employee leaves.
  • in relation to privacy and device security, this will likely involve IoT users taking practical measures such as enabling password locks on their devices which are updated regularly, ensuring they can remotely disable their device if lost or stolen and implementing firewalls to screen out hackers.

Looking to the future

Installing IoT in commercial buildings has potential to create a greater level of connectivity, automation and efficiency than has been seen before or even imagined. However, as each new wave of IoT technology is released it is important to consider the practical and legal implications for effected parties and their information to ensure it remains secure and protected. In our experience, most contracts in use today do not contemplate all of the issues that the IOT will bring.

Please contact us if you would like to discuss the issues raised in this article.

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