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Security and the IoT Ecosystem

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Security, Privacy and Trust. As organizations around the world rush to adopt Internet of Things (IoT) technologies into their business models, technology firms are eager to meet – and often help create – the demand. But success in the IoT space will take more than slick applications, connected devices and advanced analytics; it will also require a robust approach to security, privacy and trust. Find out more in the latest thought leadership report from KPMG International, Security and the IoT Ecosystem. www.kpmg.com/iotsecurity

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Security and the IoT Ecosystem

  1. 1. 1 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Security and the IoT ecosystem Our Point of View — December 2015
  2. 2. 2 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Security and the IoT ecosystem Technology firms and IoT service providers will need to work quickly, diligently and decisively to deal with concerns related to security, privacy and trust before they turn into problems. Those that fail to do so will have a difficult time growing in this new environment. “ “ – Security and the IoT ecosystem, KPMG International, 2015
  3. 3. 3 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Security takes center stage — 92 percent of companies using IoT solutions say they are concerned about cyber security Nobody doubts the potential value of IoT; what they worry about is the security — Fiat Chrysler recalls 1.4 million vehicles due to IoT hack Public concern is growing about IoT security vulnerabilities — However consumers will want to be certain of their security And the ‘upside’ of a strong security stance is becoming clearer
  4. 4. 4 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Unpacking IoT ‘Security’ We believe that a robust ‘cyber security’ approach focuses not only on protecting the devices and infrastructure that underpin the system, but also on developing the right level of data privacy and building trust with customers and regulators. “ “ – Security and the IoT ecosystem, KPMG International, 2015
  5. 5. 5 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Focus on security Security: How well CONTROLLED is the device and infrastructure? We believe… For security to be effective in IoT, it needs to be built into the technology and as close to the asset as possible: devices should have embedded security controls; software should have security embedded into the code. What we don’t recommend is building ‘open’ devices or creating platforms where security is controlled centrally. The risks are just too high.
  6. 6. 6 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Focus on privacy Privacy: How is data kept CONFIDENTIAL and private? We believe… Organizations will start to negotiate with their users to gain permission to certain personal information in return for clear benefits. As such, tech companies and IoT developers have a unique opportunity to create and manage value-added services that manage permissions and securely integrates and aggregates data.
  7. 7. 7 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Focus on trust Trust: How do you secure and maintain the CONFIDENCE of users? We believe… Some existing players will ultimately become the effective ‘trust provider’ within the ecosystems they operate in. The challenge will come when the ‘trust provider’ becomes the dominant brand rather than the device manufacturer or service provider thus, potentially, disintermediating the other players in the ecosystem.
  8. 8. 8 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Driving security, privacy and trust in the ecosystem As IoT ecosystems start to bring together more players, service providers and 3rd party suppliers into the value chain, tech firms and IoT solutions providers will face increasing pressure to demonstrate their security capabilities. “ “ – Security and the IoT ecosystem, KPMG International, 2015 How many third parties are part of your IoT solution?
  9. 9. 9 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. A new ecosystem model emerges around security We believe… The ecosystem will shift from a linear model with the customer at the end to one where the customer is in the middle and ecosystem participants orbit around them. In this environment, we expect to see traditional ‘roles’ start to shift as players start to take on different roles in the ecosystem and overall value proposition.
  10. 10. 10 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Take away 1 — The IoT sector is growing rapidly and will likely undergo several iterations of transformation — Concerns related to security, privacy and trust will also evolve and transform as the market changes — Security strategies should be broad-based to anticipate and respond to potential disruptions that could impact current market positions The IoT market is evolving
  11. 11. 11 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Take away 2 — Businesses should carefully evaluate their 3rd party suppliers, identify qualified partners, and invest in integrating security, privacy and trust across the ecosystem — Businesses should consider different approaches to building the capabilities they require within the ecosystem including whether they can buy, build, partner, invest, or create an alliance to achieve their goals The IoT eco-system plays a critical role in securing IoT
  12. 12. 12 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Take away 3 — Consumers and business partners will expect security to be built into the system — Technology architects should follow an ‘always-on’ principle that provides high levels of control with appropriate fail-safes — Given the scale and velocity of IoT growth, security vulnerabilities can become large liabilities to the company Security must be built-in from the ground up with the customer in mind
  13. 13. 13 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Take away 4 — Security architects should reconsider the security models to identify potential to enhance the value of security — Consider using premium concepts of security, privacy, and trust to differentiate the product — Security for IoT is not just about protecting valuable data, it’s also about finding opportunities to monetize the intelligence Look for opportunities to drive value from security
  14. 14. 14 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Take away 5 — Collaboration will reduce ambiguity and accelerate a company’s ability to launch products and services within a sustainable business ecosystem — Regulators will need to participate in industry discussions in order to protect market and consumer interests — Technology companies should be proactive to help regulators support IoT Engage in industry and regulatory groups to accelerate the normalization and standardization of IoT
  15. 15. 15 © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Contacts Gary Matuszak Global Chair Technology, Media & Telecommunications T: +1 408 367 4757 E: gmatuszak@kpmg.com Greg Bell, Principal and Services Leader, KPMG Cyber KPMG in the US T: +1 404 222 7197 E: rgregbell@kpmg.com Danny Le Partner KPMG in the US T: +1 213 430 2139 E: dqle@kpmg.com
  16. 16. © 2015 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The information contained herein is of a general nature and is not intended to address the circumstances of any particularindividual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particularsituation. The KPMG name and logo are registered trademarksor trademarksof KPMG International. kpmg.com/socialmedia kpmg.com/app

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