Telstra Security Report 2018: Evaluating the Trend of IoT Devices and Legal Considerations

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Cyber Security Law, Regulation and Policy
Telstra Security Report 2018

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In today’s competitive business world, companies are struggling to generate and maintain a
competitive advantage in the business in order to sustain their future growth. Investment in
advance technologies that increases the efficiency of the operations of companies and
improve communication resulted in providing a competitive advantage to organisations
(Hazen and Byrd, 2012). Along with companies, the use of these technologies assists people
to do their daily tasks in an efficient manner. The popularity of the internet makes it easier for
companies and individuals to access to online-based services to conduct their activities
effectively; however, these changes have also brought issues relating to cyber security
(Neghina and Scarlat, 2013). The threat of cyber-attacks has increased substantially which
negatively affect individuals and organisations. Telstra Security Report 2018 highlighted
various trends which possess many cyber security threats. One of these trends is the
popularity of the internet of things (IoT) devices which have become a cultural phenomenon
in the past few years. Telstra’s report predicted that the number of IoT devices would be
increased to 18.1 billion by 2022 (Telstra Global, 2018). It shows the rapid growth in the
technology; however, this growth also creates many cyber security related issues due to the
breach of private data of individuals and organisations which uses these devices. The
objective of this essay is to evaluate the trend of IoT devices based on Telstra Security Report
2018 and explore the application of legal and legislative considerations which affect this
technology. This essay will evaluate the past, current and future trends in this technology and
analyse the implications of the impact of these trends in the world. This essay will apply legal
and legislative considerations in relation to this trend in order to determine whether current
legal policies are enough to address these threats. Lastly, this essay will evaluate the
predictions relating to this trend in the future and recommend possible legal frameworks
which can be implemented in order to protect individuals and companies from its threats.
Telstra Security Report 2018 highlighted the growing risk of cyber-attacks as the number of
attacks increased substantially in 2017. Organisations are becoming more aware regarding the
importance of their security, and they are taking appropriate measures to maintain their cyber
and electronic security (Telstra Global, 2018). Still, there has been an upward trend when it
comes to growth in the number of cyber-attacks which not only resulted in the loss of
intellectual property (IP), but these attacks have also negatively affected the share prices of
companies and the confidence of customers in these companies (Telstra Global, 2018). These
attacks have publically embarrassed companies and brought threats of litigations for their
failure to protect the data of customers. For example, the data loss hacked resulted in

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impacting over 145.5 million customer accounts which is one of the biggest data breaches
reported to date (Telstra Global, 2018). The recent scandal of Cambridge Analytica highlights
that the data of Facebook users can be used for illegal practices such as finding potential
voters that support the Presidential Campaign of Donald Trump which assist in his win
(Chang, 2018). Based on these attacks, the security industry is changing rapidly to stay one
step ahead of these attacks to ensure that the data of individuals and customers are protected.
Along with the security industry, new regulations and laws are implemented by the
government in order to ensure that the appropriate legal framework is implemented to protect
the interest of victims and reduce the number of these crimes. The security report issued by
Telstra in 2018 provided that cybercrime is a lucrative business because it is estimated to cost
the world a staggering US$6 trillion annually by 2021 (Telstra Global, 2018). This amount is
expected to increase from US$3 billion in 2015. The types of cybercrimes are also increasing
with time which makes it difficult to apply previous policies and laws to protect individuals
and companies from them. Security threats such as Ransomware are proliferating as provided
by the study of Carbon Black in 2017 in which it was estimated that the Ransomware
economy has increased at a rate of 2,500 percent (Brewer, 2016). Other astounding statistics
are given by the Australia government which provided that Ransomware costs approximately
AU$1 billion per year (Telstra Global, 2018). It highlights the importance of implementation
of stricter legal regulations to ensure that the impact of these attacks is reduced and the cyber
criminals are punished for their options. There are many new threats which are on the horizon
that have been native to IT systems.
One of these trends is the popularity of the internet of things (IoT) devices which are
highlighted in the report of Telstra. This is a major trend which has become popular with the
ease of availability of high-speed internet connection in people’s homes. It is referred to a
system of interrelated computing devices, digital machines, objects, mechanical and unique
identifiers which have the ability to transfer data over a network without the assistance of
human or other computers (Gubbi et al., 2013). This technology has become prominent in
markets such as the United States, the United Kingdom and Australia due to the popularity of
smart home appliances and wearable devices. The use of these smart appliances enables
people to connect all these devices with one another so that they can communicate with each
other by sharing the data. This data sharing enables them to offer personalised services to the
users that make the whole experience easy. These devices collect private data of users and
share it with other devices in order to work appropriately. However, the popularity of these

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devices has raised many cyber security concerns as well. Since this technology is in its early
stages, there is a lack of security policies to ensure that the private data of users is stay
protected from cyber criminals (Lee and Lee, 2015). Telstra Security Report 2018 highlighted
many of these issues in the report which shows how this technology can be misused by cyber
criminals in order to collect private data of users.
As per the report, one of the biggest distributed denials of service (DDoS) attack of 2017 was
based on the use of IoT devices. This attack was called Mirai botnet in which the cyber
criminals take control over unsecured IP cameras, home routers and other electronics devices
(Kolias et al., 2017). Through IoT technology, these devices were connected with each other,
and they were able to share details with each other. The cyber criminals misused these
features, and they also collect the private data of users. After breaching the security of a
single device, there were able to hack into other devices as well through the internet routers
(Kolias et al., 2017). They were able to spy on people through their security cameras without
their knowledge. They were also able to listen to their conversations and store this data in
order to blackmail them. The users whose data were being breached were not aware
regarding this attack, and they continued with their life without taking any security measures
(Hazen and Byrd, 2012). One of the key reasons for this attack was the lack of effective
security infrastructure included in the IoT devices by their manufacturers. Telstra’s report
also highlighted that malware attacks on private data of individuals and organisations which
become possible through misuse of these IoT devices.
Although the IoT technology poses many security threats; however, the legal framework to
manage these risks are not appropriate to manage these risks. In the case of Australia, the
government has implemented various regulations in order to ensure that these attacks are
regulated in an appropriate manner (Madakam, Ramaswamy and Tripathi, 2015). However,
the advancement of technology is rapid which makes it difficult for the legal system to keep
up with these changes. The Australian Information Industry Association (AIIA) is one of the
key regulators that guide the use of IoT technology in the country. Various key guidelines are
issued by the AIIA in order to make sure the security of users is maintained while they use
IoT devices. As per these guidelines, provisions regarding communication and understanding
of what IoT technology is and how it affects the users must be given by companies. They
have to maintain right balance between innovation and interoperability of systems and data to
ensure that privacy and security of users are maintained (AIIA, 2019). Security data storage
capacity is another key requirement which IoT manufactures have to take into consideration.