Europe & UK

July 17, 2020

EU antitrust watchdog launches probe into consumer IoT devices

[ by Legal Era News Network ]


The European Commission on July 16, launched an antitrust competition inquiry into the sector of Internet of Things (IoT) for consumer-related products and services in the European Union (EU) that includes smart watches, smart home speakers, smart TVs and more.

The inquiry will focus on consumer-related products and services that are connected to a network and can be controlled at a distance, for example via a voice assistant or mobile device.

These include smart home appliances and wearable devices, the EU watchdog said in a statement.

If the EU antitrust watchdog identifies specific competition concerns, it could open case investigations to ensure compliance with EU rules on restrictive business practices and abuse of dominant market positions.

“Access to large amounts of user data appears to be the key for success in this sector, so we have to make sure that market players are not using their control over such data to distort competition, or otherwise close off these markets for competitors,” said Executive Vice-President Margrethe Vestager who is in charge of competition policy.

“This sector inquiry will help us better understand the nature and likely effects of the possible competition problems in this sector,” she added.

Broadly, the EU sector inquiry will cover products such as wearable devices (smart watches or fitness trackers) and connected consumer devices used in the smart home context, such as fridges, washing machines, smart TVs, smart speakers and lighting systems. The inquiry will also collect information about the services available via smart devices, such as music and video streaming services and about the voice assistants used to access them.

“The consumer Internet of Things is expected to grow significantly in the coming years and become commonplace in the daily lives of consumers. Imagine a smart fridge making your grocery list, you pull up that grocery list onto your smart device and order a delivery from a shop that sends the groceries to your door that unlocks automatically with a word. The possibilities seem endless,” said Vestager.

Despite the relatively early stage of development of the sector for the IoT for consumer-related products and services in the European Union, there are indications that certain company practices may structurally distort competition.

“In particular, there are indications relating to restrictions of data access and interoperability, as well as certain forms of self-preferencing and practices linked to the use of proprietary standards,” said the commission.

In the coming weeks, the Commission will send requests for information to a range of players active in the Internet of Things for consumer-related products and services throughout the EU.

The Commission expects to publish a preliminary report on the replies for consultation in the spring of 2021. The final report would follow in the summer of 2022, it said.

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