The Connection of Everything: China and the Internet of Things


Main Findings and Recommendations:

Massive growth in devices connected to the internet raises technical and policy challenges on a new scale. This ‘Internet of Things’ (IoT) is diffusing power to a growing range of actors worldwide who build and operate connected devices and the underlying infrastructure, both physical and virtual.

The IoT is amplifying both rewards from technological leadership and risks from inter-connection across borders. Sovereign governments are responding by imposing increasing control over the internet within their jurisdiction, leading to growing fragmentation of cyberspace governance on national lines.

China now plays a significant role in shaping the IoT, which is growing with the technological footprint of Chinese firms. This is being driven by the incentives of private industry, and by the Chinese state’s sustained policies to boost the role of Chinese actors in IoT development, including technical standardization.

Concerns about how China may exploit the IoT are driving moves to disconnect from Chinese networks, led by the US. But the reluctance of other countries to join a “democratic” internet coalition excluding China means that instead, the IoT will likely continue fragmenting into a variety of distinct “cyber-spaces”.

Europe must adopt measures to mitigate the growing risks from international connectivity, as well as to compete with China in shaping the IoT worldwide. This implies adapting European “cyber diplomacy” to the growing role of non-Western countries, which have their own priorities and views towards Chinese influence, in shaping the IoT and the economic systems being built upon it.

The “public core of the internet” concept offers a baseline for compromise on these issues, focused on maintaining the internet’s function as a global public good. But while avoiding a stance of unmitigated confrontation with China, Europe must closely monitor Beijing’s priorities for shaping the evolving IoT.

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