Tag Archives: iot

Costing IoT Systems in cities & institutions

Determining the total cost of ownership, operation, and stewardship of IoT Systems for an institution or city has a number of considerations. Some of these considerations are shared with traditional enterprise systems and some are unique to IoT Systems. Lack of realization and acknowledgement of these costs can lead to disappointing and costly IoT Systems outcomes. These disappointing outcomes manifest themselves in the lost ROI of an IoT investment as well as negative impacts to the cyber-risk profile to an institution.

Listing from least complex/nuanced to more complex/nuanced …

  1. Costs to host servers, databases, & redundancy — whether under desks (hopefully not), in local data centers, or in the cloud
  2. Costs to support large numbers of geographically distributed ‘Things’ & devices (the T in IoT) & the different institutional organizations that may be involved (some of which may not see or realize the potential benefit to the institution but may bear at least some of its support costs)
  3. Costs stemming from the natural friction, sometimes small & sometimes large, between multiple historically disparate organizations within an institution as they attempt to coordinate, collaborate, and address problems of understanding to support the system

1. The more familiar part — application server, database server, & redundancy costing

This costing is more closely aligned with traditional enterprise application costing than other IoT systems costs. Application licensing and support agreements are a part of this aspect. Important additional costs to include, though, are: what are the costs of hosting those applications and databases? And what are the costs of supporting that hosting (e.g. who manages the relationships, the tickets, the problems, etc).

The applications servers or virtual machines (VM’s), database servers/VM’s, and redundancy servers/VM’s can be hosted in a local data center, shared data center, the cloud, or similar. Hosting or otherwise servicing these applications and supporting databases have their own costs. In addition to fees for the hosting, there’s also some cost to managing the vendor relationship and agreement/contract.

2. A guy, a truck, and a ladder – a less obvious part of IoT System costing

 

this is not cheap

this is not cheap

Imagine an institution or city that implements 500 smart street lights that provide lighting, sense movement, maybe samples air quality, and possibly monitors and reports street or underground vibration. There will be some failure rate amongst the components in any single device/endpoint and some failure rate across the total number of installed devices/sensors – the T’s in IoT.

In this hypothetical scenario, troubleshooting and/or repair means:

  • deploying 1 or more skilled tradespeople
    • 1 or more for the work & possibly another as a safety observer
  • rolling a truck or trucks
    • with associated vehicle/fleet/fuel costs
  • spending 1-2 hours just to get to the point of troubleshooting/repair
  • 2 – 4 hours troubleshooting/repair
  • 1-2 hours wrap up and return

For this hypothetical example, let’s say the skilled tradespeople involved make $60/hour and their benefit load (expense to institution or city) is 25% for a total $75/hour expense. So, disregarding fleet and related costs, one estimate might be:

(2 hrs prep + 4 hrs on site troubleshooting/repair + 2 hrs recovery) x 2 tradespeople x $75/hr = $1200 per support event

Continuing on the thread, let’s say there’s a 10% / year failure rate (or required hardware/software update rate) of at least some component on a single device or Thing (T in IoT). That would be:

500 devices x 10% repair or troubleshoot rate/year x $1200/event = $60,000 / year

That dollar figure starts to become non-trivial. And that’s just one IoT System. Cities and institutions will have many, a portfolio, of well-managed or less-well-managed IoT Systems. Another hypothetical example is in the example  below —

IoTSysCostingExample050917

multiple costs involved

3. The insidious part — loss from organizational friction

The least apparent and possibly most costly aspect is the loss that occurs from the coordination and collaboration required between organizations and the oversight needed across all of them for a successful implementation. In the idealized scenario of institutional capacity, there is a homogeneous set of resources that include components such as available staffing levels (FTE), requisite skill sets (technical, operational, and interpersonal), support funding, political/institutional will to support the implementation and operation of the IoT System, vendor relationships, and other.

idealizedcapacity

idealized view of IoT System management capacity

In practice, however, this institutional capacity is comprised of many different organizations and the interrelationships between them.  While collaboration and inter-organizational cooperation is typically universally lauded, we all know from personal and professional experience that often collaboration between institutional organizations does not in fact work so well. Research has also been done on this phenomena where, “the discrepancy between the promise of collaboration and the reality of persistent failure” is studied (Koschmann).

Wherever two or more organizations interact with each other, some sort of friction or system loss is present. Metaphorically similar to the 2nd law of thermodynamics, not all of the time, energy, resources put into ostensible institutional IoT System management capacity will be used, or can be used, to do the expected work. In the organizational friction example, losses can come from a multitude of sources where the number of friction sources and the intensity of each can vary from organizational relationship to organizational relationship. Examples of this sort of friction/system loss and resultant loss in expected institutional capacity include:

real capacity stems from multiple organizations with multiple relationships and the friction between

real capacity stems from multiple organizations with multiple relationships and the friction between

The insidious part is that while the friction between any two organizations, may be small and possibly not obvious, these small instances of organizational friction aggregate across the whole institutional and IoT System implementation effort. Further, not all relationships are one-to-one. There are often many relationships where many organizations are involved. Likening to Newton’s Three Body Problem, adding a third planet, billiard ball, or organization can significantly increase the complexity of analysis, prediction/forecasting, and the ability to get work done.

capacityloss

 

Costing differently

In practice, capturing all of these costs can be challenging. #1 — application and database licensing and hosting costs is relatively the most straightforward and for which we generally have the most experience, but that doesn’t mean it’s effortless. We have less experience with #2 for IoT Systems — the guy, truck, & ladder costs — but that support cost can be estimated and the failure rates of devices and device components can be estimated. Costing #3 — aggregated inter-organizational friction is, by far, the most difficult and possibly the most impactful — in part because of its magnitude and in part because of the uncertainty it introduces.

The import thing, I believe, is to acknowledge all of these components, compute and estimate what we can, and work to allow for and hopefully prepare for the unique uncertainty that selecting, procuring, implementing, and managing IoT Systems brings. If we do this work, we have our best chance of reaching anticipated ROI and not degrading (possibly even enhancing) the risk profiles of our cities and institutions.

 

 

Can we manage what we own? — IoT in smart cities & institutions

The rate of growth of IoT devices and systems is rapidly outpacing the ability of an institution or city to manage those same devices and systems. The tools, capacities, and skill sets in institutions and cities that are currently in place were built and staffed for different information systems and technologies — centralized mail servers, file sharing, business applications, network infrastructure support, and similar. Some of these systems still exist within the enterprise and still need robust, effective support while others have moved to the cloud. The important consideration is to not assume that toolsets developed for traditional enterprise implementations are appropriate or sufficient for IoT Systems implementations.

What's manageable- 032217

things are increasing faster than the ability to manage those things

Working from the outside in

Starting with the outer ring, the number of ‘things’ — the T in IoT — is rapidly growing within institutions and cities. From my perspective, an IoT ‘thing’ is a device that computes in some way, is networked, and interacts with its local environment in some way. Further, these systems may be acquired via non-traditional methods. For example, a city’s transportation department may seek and acquire a sensor, data aggregation, and analysis system for predictive maintenance for a particular roadway. This system might have been selected, procured, implemented, and subsequently managed independently of the organization’s traditional central IT organization & processes. Complex and high data producing systems are entering the institution/city from a variety of sources and with little formal vetting or analysis.

Can we even count them?

Because of the rapid growth of IoT devices and systems in concert with alternative entry points into the city/institution, even counting (enumerating)  — these devices — which can compute with growing ability and are networked — is increasingly difficult. This lack of countability in itself is not so bad, it’s just a fact of life – the trouble comes when we base our management systems on the assumption that we can count, inventory, much less manage all of our devices.

What do we know about the devices?

Do we have documentation and clarity of support for the tens, hundreds, thousands (or more) of devices. What do they do? How are they configured? Have we set a standard for configuration? How do we know that that standard is being met? What services do we think should be running on the devices? Are those services indeed running on them? Are there more services than those required running? Are there processes for sampling and auditing those device services over the next 12 – 36 months?  Or did we install them, or have them installed, and simply move onto the next thing?

We can borrow from the construction industry and ask for as-built documentation. What actually got installed? What are the documents that we have to work with to support this system? Drawings? IP addresses? Configuration documents for logins, passwords, open ports/services?

What is manageable?

If we are in the fortunate position to be able to actually count these computing/networked/sensing devices with reasonable accuracy and we know some (enough) things about the devices, then the next question is — do we have the resources — staffing, time, skill sets, opportunity cost, etc — to actually support the devices? Suddenly in smart cities, smart institutions, smart campuses, we’re installing things, endpoints, in the field that may require regular updating (yearly, monthly, …) — and this occurs between the customer network with its protocols/processes and the vendor system that is proposed. Not all (possibly substantial) device updating can be accomplished effectively remotely.

Another challenge is that often the organizations that are charged with staffing, installing, and supporting these deployed IoT devices, such as smart energy meters or environmental monitoring systems, are more accustomed to supporting machines that last for years or decades. Such facilities management organizations have naturally built their planning, repair, and preventative maintenance cycles around longer periods. For example, a centrifugal fan in a building might have a projected lifespan of approximately 25 years, soft start electric motors 25 years, and variable air volume (VAV) boxes with expectancies of 25 years.

Similarly, central IT organizations generally are not accustomed to running out into the field with trucks and ladders to support 100’s, 1000’s, or more of computing, networked devices in a city or institution. So the question of who’s going to do the actual support work in the field is not clear in terms of capacity, skill sets, and costs.

device count vs mgmt ability 032217-3

Actually managing the things

So, if we have all of the above — and that subset gets smaller and smaller — have the decisions been made and priorities established to actually manage the devices? That is, to prioritize, risk manage, and develop process to manage the devices in practice? There’s a good chance that manageable things won’t actually be managed due to lack of knowledge of owned things, competing priorities, and other.

On not managing the things

It is my opinion that we will not be able to manage all of the ‘things’ in the manner that we have historically managed networked, computing things. While that’s a change, that’s not all bad either. However we do have to realize, acknowledge, and adjust for the fact that we’re not managing all of these things like we thought we could. Thinking we’re managing something we’re not is the biggest risk.

We’re moving into a world of potentially greater benefit to the populace via technology and information systems. However, we will have to do the hard work of being thoughtful about it across multiple populations and realize that we’re bringing in new risks with some known — and unknown — consequences.

Creating IoT Systems Manageability – A Risk-Managed Set of Networked Things

To achieve IoT Systems ROI and to ensure non-degradation of an institution’s existing cyber-risk profile, IoT Systems must be manageable. In turn, in order to build IoT Systems manageability, institutions will need to manage their IoT Systems risk with non- traditional approaches that includes assigning IoT endpoints (the ‘things’ in IoT) to risk categories that can be independent of the underlying technologies and vendors.

IoT Systems are increasingly complex to implement, manage, and to establish system ownership in institutions, whether cities, Higher Education institutions, or corporate campuses. In turn, an institution’s IoT Systems Portfolio – a systems of systems – rapidly deepens the complexity. We will need to tackle the problems and challenges in new ways and with new organizational concepts if we are to have an opportunity for well-managed and reasonably risk-mitigated systems. This includes thoughtful inter-organizational planning, partnerships, and development of a more common language between central IT, distributed operational organizations and departments, and vendors. Further, this will be required to establish system ownership and management plans between organizations such as facilities organizations, central IT, research groups, vendors, and others. One step toward this objective is identifying things to be managed independently of the technologies and vendors implementing them — a Risk-Managed Set of Networked Things.

Central IT won’t own all of the IoT Systems

Traditional enterprise network and system management tools, staffing models, and even language are ill-equipped to address this rapidly changing technology. Historically, network and system management tools have all been within the purview of central IT. Central IT will not be able to keep up with the accelerating growth of IoT Systems across an institution. Just like central IT organizations cannot manage every user/academic/business application on their networks (or even many of them), central IT will not be able to support all of the IoT Systems either. Business owners — operational (academic in the Higher Ed case) and administrative — will have to share that load. That’s better for them too — they are closer to the problem and have a truer understanding of desired outcomes from the system. Implementing this coordination across two or more organizations in the institution is new work though. There are not great precedents for this. Institutions, particularly Higher Education institutions, are known for their bureaucracies within bureaucracies, entrenched ways, and “cylinders of excellence..” (aka silos) .

system of system of systems ...

system of system of systems …

In a similar fashion facilities management organizations have substantial skill sets in building in and integrating equipment into built environments whether they are buildings or spaces. However, facilities management organizations don’t have network design, implementation, network management, and traditional server management skill sets. Finally, while operational departments, whether acting independently or in collective partnerships with other operational departments, know what they want systems to do and comment on performance, they do not have the required skill sets that facilities management and central IT groups bring to the table.

This organizational-spanning nature of IoT Systems in institutions make establishing ownership and a post-implementation management plan particularly challenging.

Designing for & building IoT System manageability

The growth in institutional system count, system complexity, and system interdependency makes for rapidly evolving systems management and owner environments for Higher Ed institutions. We have to take definitive steps to make things more manageable. That is, we have to design for system manageability. Applying historical and traditional tools and organizational approaches to this rapidly changing environment will no longer be sufficient.

A core component of any framework to facilitate manageability is a language, or at least shared concepts, that support it. In turn, a substantial objective of that shared language development (shared, for example, between central IT, facilities, and operational users) is to develop structures that make the systems more manageable. This sounds obvious, but in our complex environments and with our dwindling availability of time and cognitive bandwidth, it is easy to lose sight of this objective.

Agreeing on what is being managed

Before different organizations within an institution can establish those manageability- facilitating-structures and figure out how to partner, establish ownership, and mitigate risk to institutional systems, they have to be able to mutually identify and agree upon what is being managed. What is the set of things — devices, systems, spaces, buildings, infrastructure, etc — that we care about managing, from both operational and risk mitigation standpoints?

In days of relatively simpler systems, sets of networked things/devices to be managed were often defined by the network itself and/or systems on the network and/or the particular brand of technology supporting the network. Further, these networked things/devices were typically run by central IT organizations and these organizations were comfortable with using locally understood network terminology and concepts to define that set of things. Examples include — devices/things on a particular subnet or set of subnets, devices/things behind a particular firewall, on a particular VLAN or VRF, etc.

These examples above don’t mean much to potential system owners that are business organizations and/or academic organizations. The terms used are way too abstract, jargon-y, and/or colloquial. The cross-organizational planning and coordination needed for IoT Systems implementations and subsequent management cannot occur if participating groups can’t mutually identify what is to be managed.

Also problematic in trying to apply these old approaches of identifying things and systems to be owned, operationally managed, and risk-managed is that it is easy to slip into the high-granularity/high-entropy of technical details when the initial conversation is simply identifying and agreeing upon what is to be managed. Because these new and rapidly evolving technologies are increasingly complex, requiring increasingly deep technical skill sets, conversations in technical detail can be challenging even for technical professionals and effectively useless for potential academic and business partners and systems owners.

Finally, sets of things/devices to be managed might involve multiple technologies — eg maybe partially wired, partially wireless/near-field, on a VRF, behind a firewall, etc. So using a technology as a defining mechanism is further unhelpful. While a particular technology or network might happen to align well with a business need for defining a group of assets to be managed, we don’t want to start with that assumption.

IoT System Manageability Groups – A Risk-Managed Set of Networked Things

To address these shortcomings, we can consider a Risk-Managed Set of Networked Things (RMSONT). In this approach, we work to establish sets of networked things based on what best enhances manageability of the system. This is independent of underlying implementing technologies, particular vendors, and existing organizational charts.

What constitutes IoT System manageability?

A managed IoT System will have at least these attributes:

  • the IoT System was selected methodically and with purpose
  • the IoT System is named & known
    • the system has a common name that is known, shared, & published to participating parties (eg central IT, facilities management, operational departments, etc)
  • devices/things of the IoT System are enumerable
  • that is, via network process the device can be known and named
  • IoT System owners identified
  • IoT System component owners identified
  • satisfactory system performance is defined
  • system performance is measured
  • system performance is reviewed by business owners and systems support providers
  • estimates of total costs are established and shared — includes IT and Operational Technology (OT) costs
  • other

What are the qualities/attributes of a thing/device?

Things/devices in IoT Systems have at least these qualities or attributes —

  • a location
  • a function (what is it supposed to do)
  • an IP address; a MAC address
  • a power requirement
  • an associated data aggregator or controller
  • supports a user, users, or population (department, organization, constituency, etc)
  • rate of failure (estimated or known)
  • other

Creating a Risk-Managed Set of Networked Things

The #1 goal is to build and enhance IoT Systems manageability. A risk-managed set of networked things is established to create a manageable group. This could be a group managed by the business consumer or an institutional service organization such as facilities management or central IT — whatever best facilitates system ownership and management.

Multiple sets of risk-managed things can be created to facilitate overall system manageability. One example of a set of risk-managed sets might be:

  • law enforcement/security office owns and manages a set of networked video cameras (possibly with support from central IT, facilities management, local IT, vendor, etc)
  • in an academic setting, a researcher that uses a specialized HVAC IoT System with sensors, actuators, and data aggregation to provide tight environmental control of their research environment might be a logical choice to own that system
  • a metering system might best be managed by the institution’s energy management office
  • a building manager might have a risk-managed set of networked things local to their particular building, but of different types of things— surveillance cameras, energy management system, etc

In general, getting those most familiar with the IoT System’s performance expectations and actual performance into a system management role is probably a good idea.

As we talk about sets of things, and particular kinds of sets of things, we can borrow lightly from the mathematical idea of groups.

As I understand it, mathematical groups are:

  1. Sets of things
  2. These things abide by or participate in some set of rules
mathematicalgroup

A selected set of things abiding by a certain set of conditions & operations …

Similarly, a Risk-Managed Set of Networked Things, can be:

1. A set of networked and computing things/devices (that interact with the environment)

2. These things/devices participate in or are governed by some sort of network management processes and human management processes — eg automated network device enumeration/inventory, device health/responsiveness, etc

iotsystemsgroupimage

RMSONT – A Risk-Managed Set of Networked Things

 

You gotta keep ‘em separated (or not)

To borrow from Offspring’s social commentary (and popular song) on gang membership, colors, and violence in Come Out and Play, the theme of IoT Systems and network segmentation seems to be, “you gotta keep ‘em separated.” The problem is that that is not as easy as it seems.

offspringlive

tie your own rope, tie your own rope, tie your own rope (hey!)

Network segmentation has been all the rage as an answer to IoT Security and risk mitigation. However, as we’ve seen, network segmentation alone is not sufficient. Risk-managed sets of things need to be thoughtfully chosen, the rules and operations supporting that set of things needs to be thorough, and systems owners thoughtfully coupled with systems in order to achieve manageability.

We can manage IoT Systems within our institutions. And we can manage portfolios of IoT Systems within our institutions. However, we need to acknowledge that these are different kinds of systems and that our existing traditional IT systems operational and risk management approaches are likely insufficient. From that point we can sculpt and evolve new management approaches that facilitate successful, well-managed IoT Systems portfolios.

Organizational-spanning characteristics of IoT Systems

Gaps between institutional organizations implementing & supporting IoT Systems create challenges

Gaps between institutional organizations implementing & supporting IoT Systems create challenges

One of the unique characteristics of IoT Systems, and one that adds to the complexity of a system’s deployment, is that they tend to span many organizations and entities within the institution. This is particularly true in Higher Education institutions with their city-like aspects, multiple service lines, and wide variety of activities in their buildings and spaces. While traditional enterprise systems, such as e-mail or calendaring, are likely to be owned and operated by one or two institutional organizations, IoT Systems involve many and are deployed in the ‘complex and material manifestations’ that characterize buildings and spaces.

A Higher Education institution example might be a research lab that incorporates an automation and environmental control system that involves the facilities organization, the central IT organization, maybe a local/distributed IT organization, the lead researcher (aka Principal Investigator or PI), her lab team, at least one vendor/contractor and probably several other vendors. Between each of these, a gap forms where system ownership and accountability can fall. Everyone sees their piece, but not much of the others. There’s no one monitoring the greater Gestalt of the IoT System. And that’s where the wild things are.

Traditional enterprise systems tend to fall within the domain of central IT with use of the system being distributed around the institution. So with traditional enterprise systems, use is distributed but ownership and operation is largely with one organization. IoT Systems, on the other hand, tend to have multiple parties/organizations involved in the implementation and management, but the ownership is unclear.

IoT Systems are systems within systems within systems ...

IoT Systems are systems within systems within systems …

This lack of ownership can lead to unfortunate assumptions. For example, the end user/researcher in the Higher Ed case is probably thinking, “central IT and the Chief Information Security Officer are ensuring my system is safe and secure.” The central IT group is thinking, “I’ve got no idea what they’re plugging into the network down there … I didn’t even know they bought a new system. Where did that come from? “ The facilities people might be thinking, “Okay I’ll install these 100 sensors and 50 actuators around this building and these two computers in the closet that the vendor said I had to install. The research people and central IT people will make sure it’s all configured properly.” No one is seeing the whole picture or managing the whole system to desired outcomes.

This implementation and management of IoT Systems is a part of what is being explored within Internet2’s IoT Systems Risk Management Task Force in support of  Internet2’s  Smart Campus Initiative.

Technology adoption in other aspects of the building industry

Research has been done in other areas of technology implementation in the building, space, and campus realms that might help shed some light on the multi-organizational challenge that IoT system implementations can bring to institutions.

Research in the Building Information Modeling (BIM) field suggests that buildings have a ‘complex social and material manifestation … [that requires] a shared frame of reference to create.’ Building Information Modeling seeks to codify or digitize the physical aspects of a space or place such that its attributes can be stored, transmitted, exchanged in a way that supports decision-making and analysis.

In their paper, “Organizational Divisions in BIM-Enabled Commercial Construction”, researchers Carrie Dossick and Gina Neff identify competing obligations within supporting/contributing organizations that limit technology adoption.  They point out that BIM-enabled projects are “often tightly coupled technologically, but divided organizationally.” I believe that their observations regarding BIM projects also share common aspects of deploying and managing IoT Systems.

The Dossick/Neff research suggests that mechanical, electrical, plumbing, and fire life safety systems can be as much as 40% of the commercial construction project scope.It is likely that this number will only increase as our buildings and spaces become more alive, aware, and aggregating of information of what goes on in and around these spaces.

For the BIM implementations studied, the research suggests that there are three obligations of the people and groups contributing to the effort and that these can be in conflict with each other.  The obligations are: scope, project, and company.

As I interpret the paper, scope obligation is what a person or group is supposed to accomplish for the effort – what are they tasked to do. That mission is not overarching organization and coordination of the project, but rather specific, often local, tasks that must be done in support of the effort. In the course of that work, participants in the work are naturally “advocating for their particular system.“

Projects bring together temporary teams for a particular purpose. These time boundaries and purpose boundaries create the environment for the project obligation. Specific timelines and milestones can drive the project obligation. This area can be particularly challenging as it can involve negotiations among different providers, the interests of owners, and design requirements.

Finally, obligations to company “emphasize the financial, legal, and logistical requirements” where ownership and management provide the environment and context in which work is done. This also makes sense intuitively as company is whence one’s paycheck comes. Performance today can influence today’s paycheck as well as paychecks down the road.

While not exactly the same, I think there are some parallels with IoT Systems implementation and management.

BIM implementation/adoption -> IoT Systems implementation & management

  • scope -> scope
  • project -> project
  • company -> department/organization

To me, organizational aspects of scope and project are very similar between IoT Systems implementation/management and those observed and analyzed by the research in BIM implementation.

For IoT Systems implementation and management within an institution, internal departments and internal organizations can closely parallel that of the company that the research addresses. A person’s or group’s directives, performance expectations, and paycheck approval ultimately comes from that department or organization so there will be natural alignment there.

Leadership ‘glue’ has its limits

Finally, the paper also points out the role of leadership in an effort where there is new technology to potentially be adopted or leveraged. While strong leadership is clearly desirable, the research suggests that even good leaders often cannot overcome structural organizational problems with great efficiency or effectiveness. The authors also note that research does not yet understand what “organizational resources to be in place for effective collaboration to occur after new technologies are introduced.”

IoT System ownership for implementation & management

Like BIM and related technology adoption, I believe successful IoT Systems implementations have similar institutional organizational challenges. IoT Systems implementations are themselves a part of larger system of institution, organizations, and people. IoT System implementation and management success will, I believe, also require learning to work with these multiple organizations that have inherent competing obligations. While there may be other approaches to evolve to solve these organizational challenges, a reasonable place to start in the near term might be to establish organizational-spanning system ownership and accountability.

Internet2 Chief Innovation Office launches IoT Systems Risk Management Task Force

Internet2 has launched a national Task Force to study risk management needs around IoT Systems in Higher Education and research institutions. The Task Force is composed of Higher Education and research IT and Information Management leaders across the country and will explore the areas of IoT Systems selection, procurement, implementation, and management. At the end of 12 months, the IoT Systems Risk Management Task Force will deliver a set of recommendations for 3 – 5 areas of further in-depth work. (And in the interest of full disclosure, I am Chairing the IoT Systems Risk Management Task Force.)

Internet of Things Systems or IoT Systems offer great potential value to higher education, research, government, and corporate institutions. From energy management, to research automation systems, to systems that enhance student, faculty, staff, and public safety, to academic learning systems, IoT Systems offer great promise. However, these systems need to be implemented thoughtfully and thoroughly or the investment value won’t be realized. Further, because of the distributed computing and networking capabilities of IoT devices, poor IoT Systems implementations can even make things worse for institutions, corporations, or governments.

Internet2 Chief Innovation Office

i2logoThe mission of the Internet 2 Chief Innovation Office, led by Florence Hudson,  is to work with Internet2 members to define and develop new innovations around the Internet. The Innovation Program has three core working groups —

Internet2’s core offerings are its 100 gbps network and their NET+ services.  Their membership includes 300 Higher Education institutions and over 150 industry, lab, and national agency organizations.

Many IoT systems risk topics

Examples of topics that the Task Force will cover include IoT systems vendor management issues, network segmentation strategies and approaches, cost estimating tools and approaches for IoT systems, potential tool development and/or partnering with organizations that perform Internet-wide scanning for IoT-related systems, and the organizational and cultural issues encountered in transitioning to a data-centric organization.

IoT systems vendor management approaches

Organizations and institutions need to raise the bar with IoT systems vendors regarding what constitutes a successfully delivered product or service. For example, has the vendor delivered documentation showing the final installation architecture, have default logins & passwords been change on all devices (how is this demonstrated), have all unnecessary services been deactivated on all devices and systems and how is this demonstrated?

Development of common ‘backends’ for IoT systems

Current IoT systems (to include utility distribution, building automation systems, many others) vendor approaches require that institutions invest in separate and proprietary ‘backend’ architectures consisting of application servers, databases, etc for each different vendor. This is an approach that does not lend itself to manageability, extensibility, or scalability.  In this space, perhaps newer container and container management technologies offer solutions as well as other possibilities.

1200px-Internet_of_things_wilgengebroedDevelopment of network segmentation/micro-segmentation strategies and approaches for IoT Systems

Network segmentation seems to offer great promise for mitigating risk around IoT Systems implementations. However, without appropriate guidance for IoT network segmentation implementation and operation, institutions can end up with a full portfolio of poorly managed network segments. Exploration and development of institutional network segmentation best practices can serve to lower an organization’s risk profile.

Development of cost estimating tools and approaches for IoT Systems

There is little in the way of precedent for cost models for the rapidly evolving IoT systems space and, as such, planning for IoT Systems and trying to estimate Total Cost of Ownership is difficult and nuanced. Exploration of and development of IoT Systems cost models can be of real value to institutions making planning and resourcing decisions.

Development of risk language & risk categories around IoT systems

Currently it is difficult to discuss new risk brought on by IoT systems with enterprise risk managers because IoT systems themselves are difficult to describe and discuss.  Development and socializing IoT risk language, that incorporates existing familiar institutional risk language, would enhance the ability to discuss IoT systems risk at the enterprise level. This Task Force will explore this nuanced space as well.

Analysis tool development and partnering

The Task Force will explore tool development and/or partnerships with organizations that scan the Internet for industrial control systems and IoT systems and publish these results online. Exploring internal tool development of the same is also a possibility. Development of benchmarks and baselines of Internet-scanning results across different industries and market sectors will also be considered.

Organizational cultural barriers to successful implementation of IoT Systems

Changing from a traditional organization to a data centric organization is a non-trivial transition and not addressing these issues can be a barrier to successful implementations of IoT Systems in institutions, organizations, and cities. The Task Force will study this important space as well.

Early Task Force work will also include identifying and enumerating other independent and overlapping risk areas (operational, cyber, cultural, and others). Over the year, Task Force members will participate in phone conferences, listen to subject matter expert presentations, and identify, discuss, and prioritize IoT Systems issues. Finally, recommendations will be made for further focused work on the highest priority areas.  If you have questions, comments, further interest, please contact me ChuckBenson@longtailrisk.com or the Internet2 Chief Innovation Office at CINO@internet2.edu.

 

[IoT image above: By Wilgengebroed on Flickr – https://www.flickr.com/photos/wilgengebroed/8249565455/, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=32745541]

A potential IoT systems vendor checklist v2.0

In order to maximize the value of an IoT system to an institution or city, how that system is implemented is critical. Without a thoughtful and thorough implementation, the value of the investment will not be met and, possibly, the value can even be negative through the addition of unmitigated risk to the institution or city.

I’ve updated the IoT systems planning considerations list from an earlier post and created a more checklist-like document to use when working with IoT systems vendors. Earlier versions appeared in posts Institutional considerations for managing risk around IoT,  Developing an IoT vendor strategy, and Systems in the seam – shortcomings in IoT systems implementation. Ideally, this document could be used during the contract development and negotiation phases with the vendor.

The intent of the document is to help compute the Total Cost of Ownership for an IoT systems implementation as well as raise expectations of the vendor for a delivered system. In doing so, we can help mitigate some operational risk (suboptimal business decisions) as well as cybersecurity-related risk (bad guys wanting to use our assets in a malicious manner).

I’ve created rough categorizes of issues falling under operational risk, cybersecurity risk, and those falling in both categories to help provide some additional structure. However, many issues influence each other so it’s not critical to get tied up in the categorization.

IoTChecklistV2-032716

A starting point for an IoT systems vendor checklist

pdf version here

Looking for a quick definition of IoT?

Defining IoT (image Wikipedia)

Defining IoT
(image Wikipedia)

 

Tired of looking for the right words when trying to impress your boss, friends, or potential future spouse with a description of the Internet of Things, aka IoT ? Well look no further !

The 10 word version

Here’s a 10 word version. An IoT device is one that:

1. Computes
2. Is networked
3. Interacts with the environment in some way

The 20 word version

And once you’ve impressed them with this knowledge that just rolled off your tongue, feel free take it further with the 20 word version!

1. Computes
2. Is networked
3. Interacts with the environment with the intention of collecting sensory data and/or manipulating the local environment

For example:

  • A FitBit device computes, is networked, & interacts with the environment (ie you)
  • An industrial  SmartGrid meter computes, is networked, & interacts with the environment (collects power data)
  • A residential Nest meter computes, is networked, and interacts with the environment (collects temperature data)
  • Chicago’s Array of Things devices compute, are networked, and interact with the environment (collect many environmental data points)
  • Blood glucose monitors compute, are networked, and interact with the environment (ie you)
  • and much much more !!

And then, while impressing those around you, you can bring it on home with the definition of an IoT System. An IoT system:

1. Is a set of IoT devices that
2. Communicate with each other and/or communicate with
3. A central server that aggregates data and/or provides control data

Congratulations on your assured future personal, social, and professional successes now that a handy definition of IoT is at your disposal!

IoT & the Rule of 72

There are many different estimates regarding the growth rate of the Internet of Things (IoT). There are projections of number of connected devices, projections on market capitalization, projections on growth of semiconductor counts supporting those devices, and many others. Because the numbers of devices and systems are so high and these projections are around things that we typically don’t understand well, it’s hard to get a feel for what is actually increasing so rapidly. What is this thing that is growing so rapidly? How fast is it growing? If we can’t roughly understand the magnitudes involved, we can’t discuss, plan, assess, or begin to mitigate risk to our organizations and institutions involving these systems.

Going old school

summa

Summa de arithmetica – Wikipedia http://bit.ly/1MHOuxO

One way to better our ballpark understanding of this rate of growth can be with the old school method of applying the Rule of 72. Introduced by Pacioli in Summa de Arithmetica, the Rule of 72 has been around for over half of a millennium as a mental mechanism to quickly estimate how long it takes a value experiencing exponential growth to double. This works with systems that have parameters that are described by a percentage change over a period of time.  The classic example is interest on a loan or investment that compounds. Because we are used to seeing these kinds of measures in financial, economic,  and political systems, we will see them in IoT conversations also.

To apply the Rule of 72, you take the rate of growth for a period expressed as a percentage and then divide that into the number 72. The result is the number of time periods, typically expressed in years, that it takes for the doubling to occur.

For example, if you buy a house that increases in value by 6% per year, the time to double the value is:

72 / 6 = 12

or 12 years to double. So a $400,000 house purchased today that appreciates by 6% per year will see a value of around $800,000 in 12 years.

(72 is a convenient estimate that facilitates mental division with values such as 2, 3, 4, 6, 8, 12, etc. A more accurate, but less easy to mentally work with, value is closer to 69. This stems from the value for natural log 2, aka ln(2), which is .69314 … For our purposes, we’ll stick with 72.)

Making IoT growth estimates more understandable

As we all try to get our heads around IoT, what it is, and how fast it is growing, we are bombarded by a variety of estimates and figures. We know these numbers seem big, but we’re not really sure how to use these figures or compare them to something else. Being able to quickly compute how long it takes for something to double in quantity can have more meaning for us than trying to interpret growth expressed as a percentage.

In his book Grapes of Math, Alex Bellos does a great job of describing where the Rule of 72 comes from and how it works.  Further he reminds us that economic, financial, political, and other growth measures that describe sales, profits, stock prices, GDP, population, inflation, and more are often stated in percentage growth per year.  Because of our familiarity with communicating this way, we can expect at least some IoT growth projections to be stated this way as well.

Gartner Press Release http://www.gartner.com/newsroom/id/2905717

Gartner Press Release http://www.gartner.com/newsroom/id/2905717

Gartner’s installed IoT base estimate from late 2014 suggests exponential growth — 25% growth from 2013 to 2014, 30% growth from 2014 to 2015, and what looks like almost 40% annual growth from 2015 to 2020.  If this is the case, then we can estimate 72 / 40 = 1.8 years to double. So, if we started with the almost 5 billion devices indicated in the 2015 column, we’d have 10 billion in about 22 months, sometime in 2017 — 1.8 x 12 months.

GartnerPWCAnalysis

Analysis of IoT growth on semiconductor industry – http://pwc.to/1kwDuNc

This Gartner/PriceWaterhouseCoopers analysis shows a CAGR growth for sensors and actuators of approximately 10%.  Applying the Rule of 72 for an estimate, we can expect to see the number of sensors and actuators deployed in the world around us to double in ~72 / 10 = 7.2 years — less than 2 presidential terms. What will twice the number of sensors and actuators around us look like?

According to this IDC report, the IoT market will see 19% growth  for a market size doubling in a little under 4 years (72/19 = 3.8). The biggest growth area was 40% CAGR in the automotive sector for a market doubling in under 2 years.

BIIntelIotGrowth

Lots more connections … http://bit.ly/1msfrjG

This Business Insider report suggests a 45% year over year growth from 2 billion in 2014 to 9 billion in 2018 for connection count doubling in 72/45 = 1.6, a little over a year and a half.

And finally, ON World predicts a 250% growth in wireless light bulbs for a doubling in every ~ 3.5 months.

Limitations

It’s important to note that we don’t know what IoT growth will actually look like over several years. We have some initial data from the first few years that seem to suggest that this growth will be exponential versus linear growth, for example.  Also where the Rule of 72 was initially applied — money growth (compounding) —  is a recursive context — money grows because there is money to act on (and time). IoT growth will come from something else.  At least for now, it’s not obvious that IoT growth is or will be recursive* — we don’t know that many IoT deployments this year will cause even more deployments next year, and then that next year’s increased deployments will cause yet an even higher incremental increase the following year, and so on.

*[One frightening possibility, of course, is the Skynet scenario from Terminator where conscious machines build conscious machines and recursion in full play …]

If, however, IoT growth roughly mimics or correlates to compounding growth (for whatever reason), then we can use the Rule of 72 to help us quickly estimate magnitudes and time scales and add some context to our conversations. With more context around the phenomenon of IoT, the better are our chances for managing the risk to our organizations that comes from its proliferation.

Power laws & power plants – tackling IoT systems risk classification

Do aspects of Shodan data – data about Internet of Things (IoT) devices and systems – demonstrate ‘long tail’ qualities? Data showing these qualities sometimes also go by the name of having a ‘Zipf distribution‘, following a power law, or behaving according to the Pareto principle. If there is in fact a reoccurring relationship or curve that occurs across aspects of IoT data, that might offer some insights into how to categorize or classify aspects of IoT systems. For managing risk around IoT systems implementations, our current ability to classify and categorize these systems is sorely missing. Potentially, it could also offer predictive capabilities regarding elements of the Internet of Things phenomena.

To take an initial swing at it, I narrowed the question down to:

Do the frequencies of occurrences of particular ports (services) in an organization, or other Shodan data set, behave in a repeatable way?

Long tails & power laws

The concept of long tail behavior was popularized in Chris Anderson’s 2004 Wired article and it has entered popular vernacular in the years since. What Anderson articulated was that aspects of many systems or sets of data are characterized by the observation that there are a lot of a few types of things and then a rapidly dropping number of other types of things — but there are a lot of those other types. Anderson used the example of record sales — there are a relatively few mega-hit songs, but there are a lot of non-hit songs and record companies were learning how to capitalize on this observation. This is the long tail.

George Zipf

George Zipf

Another example is early ‘long tail’ work attributed to George Zipf with his analysis of word distribution frequencies in any particular text. He found that if you:

  1. counted how often each word appeared in a text
  2. ranked each word so that the word with the highest count got the highest rank (i.e. #1) and down from there
  3. plot the results in a graph

then you find a curve that shows that a few words show up a lot.

 

For example, the words ‘the’, ‘be’, and ‘to’ show up a lot (1st, 2nd, & 3rd in a ranked list) and words like ‘teeth’, ‘shell’, or ‘neck’ shows up around 1000 places down the list. From the first few spots in the ranked list, the frequencies of other ranked words fall off quickly — but there a lot of those ‘other’ words. Further, this curve is a power law which looks a bit like y = 1/x. Variations include multiplying 1/x by something and raising x to some exponent. (For Zipf relationships, this exponent is often close to 1).

Yet other Zipf relationships are found in studies of populations of cities data and website references.

citypopulationdata

Ranking city population sizes also follows Zipf-like relationships (the loglog plot is fairly linear)

Power law relationships in IoT data?

John Matherly, founder of Shodan, has been collecting data on IoT sorts of devices for years. He scans all publicly accessible IP addresses for particular ports for Internet of Things or Industrial Control systems including things like power plants, video cameras, HVAC systems, and others.

I have a particular interest in how IoT data shows in higher education IP address spaces, so I analyzed large subsets of data in some of those institutions. To do this I queried for data from those publicly facing IP spaces in the organization and exported it to a json format. (Shodan also offers an XML version, but it is deprecated). From the downloaded data, I used Python scripts to clean the data a bit, count how often each port occurred, and then rank them by organization. Finally, I used the Python module matplotlib to plot the results.

This is similar to the word frequency analysis approach above where, for a set of data:

  1. Count the number of occurrences of each port (service)
  2. Rank the ports so that the port (service) that occurs most frequently gets the highest rank
  3. Plot the results

Like word frequency data in Zipf studies, a plot of frequency of occurrence of each port vs rank of each port’s frequency yields a curve that drops off so fast that it is hard to discern nuanced information. However, the fact that it does drop off so fast let’s us know something at a glance that is similar to Zipf data — a very few ports occur most often and a lot of ports have a few occurrences.

nonlogmultipleuniversity

4 universities and 1 (organizationally) arbitrary & large) set of IP addresses on normal (non-log) plot

What gets more interesting visually is to plot that same data on a log log scale. This kind of brings the curve out to where it’s easier to see.

Zipf-like data can follow the relationship of y = 1/x almost exactly for much of the range. (This is part of why word frequency, city population data, etc is so intriguing.) So when plotted on log log, much of the line looks almost straight – slope of 1 (ish).

A log log plot of university IoT data doesn’t yield a straight line, but sort of a bulging out line. If you were standing on the graph way out to the right and up and looking toward the origin, it would appear convex. So this isn’t Zipf in the traditional sense — the log log plot is not linear.

However, they do look similar. University1 looks roughly like University2. University2 like University3, and University3 like University4, etc. The curve roughly retains its shape regardless of the school, though the school sizes are different (or at least the number of public IP addresses are different).

loglogmultipleuniversity

4 universities and 1 (organizationally) arbitrary & large set of IP addresses on log log plot

Maybe the organization doesn’t matter?

Also plotted are the results from a search on all of the IP addresses in the 128.0.0.0/8 range (using CIDR notation).  This curve, though bigger and slightly smoother, has roughly the same shape as the others. The main thing that separates it from the others appears to be magnitude (number of IP addresses sampled). It appears that there is nothing particularly unique about an organization that drives this curve shape — a similar shape appears even if a set based on a numerical range, regardless of organization, is chosen.

It will be interesting to see if, as IoT device count grows, the curve changes shape. Will the set of IoT devices across the globe continue to communicate mostly over the same ports/services as those currently in use, keeping the same shape? Or will new ports/services/enumerations show themselves as IoT device proliferation continues, changing the shape?  By analyzing ranking relationships over time and between organizations, this approach could provide some insight into helpful categorizations for risk analysis.

Institutional considerations for managing risk around IoT

socket

sockets for vendor products & services

There are a number of things to think about when planning and deploying an IoT system in your institution. In posts here since last spring, several issues have been touched upon — the idea of sockets and seams in vendor relationships, the rapid growth in vendor relationships to be managed and the resulting costs to your organization, communicating IoT risk, some quick risk visualization techniques based on Shodan data, initial categorization of IoT systems, and others.  The FBI warning on IoT last week is a further reminder of what we’re up against.

There is a lot to chew on and digest in this rapidly changing IoT ecosystem. Below is a partial list of some things to consider when planning and deploying IoT systems and devices in your institution. It’s not a checklist where all work is done when the checking is complete. Rather, it is intended to be a starting list of potential talking points that you can have with your team and your potential IoT vendors.

Some IoT Planning Considerations

  • Does IoT vendor need 1 (or more) data feeds/data sharing from your organization?
    • Are the data feeds well-defined?
    • Do they exist already?
    • If not, who will create & support them?
    • Are there privacy considerations?
  • How many endpoint devices will be installed?
    • Is there a patch plan?
    • Do you do the patching?
    • Who manages the plan, you or the vendor?
  • Does this vendor’s system have dependencies on other systems?
  • How many IoT systems are you already managing?
    • How many endpoints do you already have?
    • Are you anticipating/planning or planning more in the next 18 months?
  • Is there a commissioning plan? Or have IoT vendor deliverable expectations otherwise been stated (contract, memorandum of understanding, letter, other?)
    • Has the vendor changed default logins and passwords? Has the password schema been shared with you?
    • Are non-required ports closed on all your deployed IoT endpoints?
    • Has the vendor port scanned (or similar) all deployed IoT endpoints after installation?
    • Is there a plan (for you or vendor) to periodically spot check configuration of endpoint devices?
  • Has the installed system been documented?
    • Is there (at least) a simple architecture diagram?
      • Server configuration documented?
      • Endpoint IP addresses & ports indicated?
  • Who pays for the vendor’s system requirements (eg hardware, supporting software, networking, etc?)
    • Does local support (staffing/FTE) exist to support the installation? Is it available? Will it remain available?
    • If supporting IoT servers are hosted in a data center, who pays those costs?
      • startup & ongoing costs?
    • Same for cloud — if hosted in cloud, who pays those costs?
      • startup & ongoing costs?
  • What is total operational cost after installation?
    • licensing costs
    • support contract costs
    • hosting requirements costs
    • business resiliency requirements costs
      • eg redundancy, recovery, etc for OS, databases, apps
  • How can the vendor demonstrate contract performance?
    • Okay to ask vendor to help you figure this out
  • Who in your organization will manage the vendor contract for vendor performance?
    • Without person/team to do this, the contract won’t get managed
  • Can vendor maintenance contract offset local IT support shortages?
    • If not, then this might not be the deal you want
  • For remote support, how does vendor safeguard login & account information?
    • Do they have a company policy or Standard Operating Procedure that they can share with you?
  • Is a risk sharing agreement in place between you and the vendor?
    • Who is liable for what?

Typically, with the resources at hand, it will be difficult to get through all of these — maybe even some of these. The important thing, though, is to get through what we can and then be aware of and acknowledge the ones we weren’t able to do. It’s way better to know we’ve come up short given limited resources than to think we’ve covered everything when we’re not even in the ballpark.