Will Regulators Disrupt Mobility’s Disruptions?

 Author(s): , Posted on April 22nd, 2015

Most of the time, the mobility landscape looks like a free-wheeling, hard-charging, out-with-the-old-rules world. Not just disruptive, but disruptive at warp speed.

But not so fast, you might say. Waiting in the wings, prepared to cool things down while they assess safety, security, privacy, and other concerns, are regulators in multiple agencies at multiple levels of government.

Tech moves fast. Regulators, as a rule, do not. In one area after another we are seeing – or should expect to see – regulators metaphorically putting up the yellow flag.

  • Apple/FDA – Apple recently announced how its new iPhone will transform medical research, thanks to its new program called ResearchKit that lets users opt in to share their health data with medical researchers. That’s exciting and innovative. But if it turns out that the device can be used to diagnose users with a particular disease or condition, you can imagine that the Food and Drug Administration will be stepping into the matter, no doubt issuing regulations and requiring Apple to submit its device and apps to its regulatory process. And not just Apple, but all the entrepreneurs out there right now busily building apps to ride on the device will be subject to FDA rules still in the works.
  • Security – In another headline dominating example, the email/server controversy with the former Secretary of State is surfacing widespread misunderstandings about security. It seems safe to conclude that the upshot will include new and tighter regulations from the Bureau of Diplomatic Security and its counterparts throughout the federal government. And it won’t be just .gov affected. InfoWorld reports: “The mixing of work and personal lives, legitimate needs for secrecy, and 24/7 availability combine to create a challenge every company faces…I defy any experienced executive to deny they’ve used personal emails accounts and personal phones to conduct business at times for…secrecy or deniability reasons.”
  • Cloud – IDC Financial Insights recently released a study about cloud computing in the banking industry, predicting a positive future long term, but the title of the study is telling: Cloud Computing and Regulation in Banking: Unclear Guidance from Regulators Inhibits Adoption.With inconsistent and sometimes conflicting regulation of cloud usage and related data storage across the globe, and the sheer quantity of regulatory submissions required, the benefits of cloud continue to justify the level of effort required, but the pace of adoption is being impacted.
  • Privacy – Rapid adoption of wearables is spurring privacy concerns, as they create new opportunities for wearers to give up data with or without their knowledge. According to zdnet.com, “This mass collection of data spurred the Federal Trade Commission to send a report on data brokers to Congress last spring, asking for legislation to allow people to know what data is being collected about them and who is collecting it.” The market has been quick to respond. Now there’s a whole line of wearables that defend against having your data collected. Forbes reports that “this modern armor promises to thwart surveillance cameras, TSA agents, drone strikes, subway crowding, and cellular connectivity. For the most part, the wearables are more fashionable than wearing a tin foil hat.”
  • Others – Uber and Lyft are running into regulatory barriers about their background checks on drivers. Airbnb faces opposition from municipalities for not meeting hotel standards and paying taxes that hotels pay. Drones are getting extra scrutiny from the FAA.

It has always been the case that regulators necessarily lag invention. But in the sped up world of innovation today, regulatory scrutiny and pace could play a bigger role than ever. Besides, the problematic impacts of disruptive technologies are not always apparent. Who can predict, for example, the implications of data being collected from children wearing wearables?

Everybody knows speed to market matters. It will be up to the innovators themselves not only to steer carefully amid regulatory shoals but also to anticipate and obviate regulator objections wherever possible.

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