IoT expansion requires interoperability to prevent closed ecosystems

The expansion of the Internet of Things (IoT) may require interoperability mechanisms to prevent proprietary standards from creating closed ecosystems that hinder competition. This assessment was presented by Ana Frazão, a professor at the University of Brasília, during a workshop hosted by Anatel.

Frazão noted that when devices, data, and services are integrated into a single ecosystem, proprietary standards can create barriers to entry for competitors. This issue increases switching costs for users, as moving to a new provider may involve replacing an entire network of interconnected devices and services rather than a single isolated service. Such barriers can affect secondary markets, including maintenance, repairs, and third-party software.

To address these challenges, potential instruments for reflection include mandatory interoperability, data portability, non-discrimination in API access, and increased system transparency. Frazão warned that design decisions, protocols, and data standards can appear neutral while still producing exclusionary effects.