Written evidence submitted by AMDEA

 

 

AMDEA response to DCMS Committee call for evidence into “Connect tech: smart or sinister?”

Released on: 23 June 2022

Author: Heidi Ranscombe

Contact: info@amdea.org.uk

 

Who are AMDEA

AMDEA is the UK trade association for manufacturers of large and small domestic appliances; representing over 85% of the domestic appliance industry, rising to 90% of white goods brands. Members’ products include most of the UK’s top selling brands of major white goods, other large and small kitchen appliances, heating, water heating, floor care, waste disposal and ventilation equipment.

 

Executive Summary

AMDEA welcomes this inquiry into the role of connected technologyOur observations on the emerging functionalities within our sector include the following:

 

 

 

 

 

 

1.

What has been or will be the most important impacts of increasingly prevalent smart and connected technology in our lives, including in the home, in the workplace and in our towns and cities, and are they necessarily better than current systems?

 

 

Response: 

 

Connected domestic appliances can contribute to societal, sustainability and inclusivity goals. IoT capability has been around for a while. But consumer behaviour is  an important factor in appliance performance.

 

The 2050: Fridge of the Future conference organised jointly by AMDEA, OPSS, the City University of London and the London Fire Brigade in September 2021 reviewed the approach to large domestic appliances (LDAs)The conclusions published by the OPSS, note that smart features can improve: energy and water efficiency usage, maximise lifespan, reduce food waste, improve usage for younger and older demographics and work with a smart energy system to draw power at the optimum times and save consumers money.  But consumer behaviour plays a part in delivering this potential.

 

A literature review prepared by City University for the conference noted that although IoT capability has been around for a while, consumer demand is only recently catching up. The faster take up was due to better affordability (driven – at that time - by lower cost electronic components and reduced manufacturing costs) and more useful functionality, such as control through smart phones and the use of AI/machine-learning to offer new services (e.g. a smart fridge that notifies when food is going off).

 

A report published by APPLiA (the association of the European appliance industry including the UK) in 2020, estimated (on basis of the global outlook at that time) that from 2017 to 2024 the number of smart appliance users would grow by an average of 23.7% a year – rising from 14.6 million in 2020 to 31.3 million in 2024

 

Statistics in the upcoming 2022 edition of the Euromonitor International Consumer Appliances report, include the following examples of the growth of connected appliances in the UK market between 2016 and 2021.  This covers sell-out data, in volume units:

  • Automatic Washing Machines and Automatic Washer Dryers combined: Connected appliances accounted for only 9% of the market in 2016 (around 340 thousand units), growing to 24% units sold in 2021 (around 870 thousand units). Non-connected appliances were thus 91% in 2016 (around 3,300 thousand units) and 76% of the market in 2021 (around 2,730 thousand units)
  • Fridge Freezers: Connected fridge-freezers made up 7% of the market in 2016 (around 156 thousand units), growing to 17% of the market in 2021 (around 440 thousand units).
  • Ovens: Connected ovens grew from only around 1.5% of the market in 2016 (around 19 thousand units) to 17% in 2021 (around 445 thousand units).

 

2.

Are there any groups in society who may particularly benefit from or be vulnerable to the increasing prevalence of smart technology, such as young or elderly people, people with disabilities and people likely to be digitally excluded?

 

 

Response: 

 

Connected technologies are an emerging market. There are opportunities to build consumer group behaviours into the design of appliances. 

 

The approach to inclusivity in the design of LDAs was raised in our 2021 Conference: smart technologies offer opportunities but some aspects require caution. A strong theme was that more design thinking should be spent on matching user groups’ actual behaviour, including the young, old and visually impaired. For example, flatscreens can be more difficult for the partially sighted. A connected product can talk to the owner to set the temperature, time, alarms etc. 

 

On the other hand, certain smart features may only make sense for premium appliances, with a risk that sections of society could get left behind.  Alternative business models include for example pay-per-use models. There is value in examining the demand for leasing.

 

Finally, there should be a balance in collecting data: understanding consumer behaviour contributes to the improvement of the design and functionality of appliances.  It is necessary however, to ensure this is collected and used in a transparent and responsible way.

 

3.

How can we incentivise or encourage design that is safe, secure, environmentally- and user-friendly and human rights compliant?

 

 

Response: 

 

Regulatory frameworks and standards play a lead role in incentivising safe, secure and sustainable product designs that engage consumers and respect human rights. However, they need to be supported by consumer education programmes.

This is a rapidly evolving market.  Regulatory frameworks need to provide a safe place for both consumers to engage and manufacturers to innovate. Likewise standards play a key role for existing, and potential new, market actors.  They offer confidence to consumers in the safety and sustainability of available products and set a baseline for smart features, for manufacturers.  This in turn underpins fair competition that rewards “good” actors.

 

Legislators need to adapt existing offline protections and conformity requirements to new digital and connected functionalitiesRegulatory frameworks need to accommodate the global nature of many product supply chains to ensure UK consumers have access to the best performing appliances at the best prices. These reviews need to be carefully cost impact assessed and carried out transparently, in open consultation with stakeholders.

 

The current pace of digital innovations heightens the need to speed up standards development, currently at 3-4 years for development followed by a 3 or 5 year standstill requirement.

 

Legislative and standards examples are explained further below.

 

Ultimately however, incentivisation for new design innovations is driven by the market and consumer behaviour plays a significant role in this.  Programmes to raise awareness, build digital literacy and promote best practices need to run in parallel.  AMDEA supports consumer education programmes through initiatives such as our sustainability campaign, which includes promoting the role that smart technology in appliances can play.

 

This Autumn AMDEA will launch a new programme to engage consumers in the environmental and financial benefits that today’s smart appliances can offer, when used as the industry’s designers intended.  Throughout 2023 AMDEA will be using in-home case studies, competitions and tutorials  to demonstrate  to the public how choosing, using and maintaining new appliance technologies correctly can save them pounds and protect the planet.

 

4.

What are the key short- and long-term risks and threats, and how can we ensure the devices, systems and networks of individuals, businesses and organisations are digitally-literate and cyber secure?

 

 

Response: 

 

Additional challenges to those explained in response to other questions include enforcement, such as policing online marketplaces and the approach to global supply lines.

 

E-commerce is expected to grow as a distribution channel for appliances as consumers are increasing comfortable shopping online. Online marketplaces increase the risk that non-compliant products reach the market from outside the UK, where the supplier sits outside direct UK jurisdiction. This raises issues such as the need for adequate resourcing for enforcement authorities, and for cooperation arrangements with oversees enforcement bodies to underpin the safety and security ecosystem.

 

5.

How will current geopolitical concerns influence domestic consumers, e.g. regarding standards of imported goods or in how we can deal with cyber threats?

 

 

Response:  Not Applicable – See replies to questions 4 and 6

 

6.

Do existing frameworks, like data protection legislation and the Public Security and Telecommunications Infrastructure Bill, adequately address concerns with smart technology, and if not, how could they be changed?

 

 

Response: 

 

The revision of national and international frameworks to support ambitions for connected appliances, is still at a relative early stage, with some proposed initiatives mooted but not yet tabled. Policy makers should engage with market stakeholders on all these initiatives to fully assess the impact of proposed changes and ensure that the new instruments deliver their intended outcome.

 

Below is an indicative list of measures on which AMDEA is engaged.

 

The role of energy smart appliances in a smart and flexible electricity system

 

The 2021 update of BEIS and Ofgem’s joint Smart Systems and Flexibility Plan confirmed the Government’s continued intention to take powers to regulate “energy smart” appliances when parliamentary times allows.  These powers would set requirements underpinned by the principles of interoperability, data privacy, grid stability and cybersecurity.  This energy focus will be coordinated with the wider government regulation of consumer connected products (see the PSTI Bill below).

 

Actions to move this ambition forward in the meantime include the BSI Energy smart appliance programme for which two key deliverables were PAS 1878 (2021) covering functionality and the systems architecture for energy smart appliances and 1879 (2021) a code of practice on demand side operation. AMDEA participated in the Strategic Advisory Group for this initiative to support the development and deployment of DSR-capable (demand side response) devices.  This project aims to support the development of European and international standards to achieve similar ambitions across the globe.

 

Tightening the cybersecurity of connected appliances

 

Part 1 of the Product Security and Telecommunications Infrastructure (PSTI) Bill draws on the internationally recognised EN 303 645 which set baseline requirements for the cybersecurity of consumer IoT (Internet of Things).  This in turn was based on guidelines in the voluntary code of practice developed by DCMS in conjunction with the NCSC, in the context of its “secure-by-design” agenda. Although the standards and security requirements are known to industry, there are currently no technical specifications to underpin certainty of compliance.  The grace period for the application of the Act should begin only when the details of the regulatory framework are confirmed and the regulator is known. A continued drive to maintain compatibility in international norms will help strengthen consumer protection as well as the availability and affordability of innovative products.

 

Regulating AI

 

AMDEA looks forward to the publication of the Government’s White Paper on AI later this yearWe note the UK’s international engagement and thought leadership around the development of global AI standards, referenced in its 2022 UK Digital Strategy. We also note in the meantime, that the European standards bodies have been requested (in advance of the finalisation of the draft EU AI Regulation) to initiate work that need not await this legislation.  AMDEA is working with APPLiA (the European association for domestic appliances) to assess the impact and approach for our sector.

 

The role of data

 

The architecture for data flows will be key to defining the potential role of connected appliances, in multiple Government ambitions (e.g. the growth of the digital economy, our Net Zero goals, an inclusive society etc) as well as  the level of confidence that market actors will have, to play their own role in thisWe welcome the Government’s ambition in the 2022 Digital Strategy, to shape an accessible interoperable international data ecosystem in order to harness the power of responsible data and promote growthThese are welcome principles for the upcoming Data Reform Bill.