The Internet of Things (IoT) Promises New Benefits — And Risks: A Systematic Analysis of Adoption Dynamics of IoT Products

22 Pages Posted: 23 Aug 2017 Last revised: 29 Mar 2018

See all articles by Mohammad Jalali

Mohammad Jalali

Massachusetts Institute of Technology (MIT) - Sloan School of Management; Harvard University - Harvard Medical School

Jessica Kaiser

Massachusetts Institute of Technology (MIT), Students

Michael Siegel

Massachusetts Institute of Technology (MIT)

Stuart Madnick

Massachusetts Institute of Technology (MIT)

Date Written: August 18, 2017

Abstract

• The rush to adopt products on the Internet of Things (IoT) before securing them will make them attractive to cyber criminals and vulnerable to cyber-incidents. • Organizations can weaken the effects of cyber-incidents by creating cybersecurity capabilities at the beginning of their market growth, particularly detailed response plans with clear action items and owners. • Start-ups, in particular, are vulnerable to the tradeoffs between immediate revenue through accelerated market adoption and risked revenue from security vulnerabilities. • Potential adopters decide to adopt new IoT technologies based on their perception of risk-reward ratio. Internet of Things producers can improve such risk-reward ratio by early and continuous cybersecurity capability development, minimizing customer churn during a cyber crisis.

Suggested Citation

Jalali, Mohammad and Kaiser, Jessica and Siegel, Michael and Madnick, Stuart, The Internet of Things (IoT) Promises New Benefits — And Risks: A Systematic Analysis of Adoption Dynamics of IoT Products (August 18, 2017). MIT Sloan Research Paper No. 5249-17. Available at SSRN: https://ssrn.com/abstract=3022111 or http://dx.doi.org/10.2139/ssrn.3022111

Mohammad Jalali (Contact Author)

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

HOME PAGE: http://scholar.harvard.edu/jalali

Harvard University - Harvard Medical School ( email )

101 Merrimac St
Suite 1010
Boston, MA 02114
United States

HOME PAGE: http://scholar.harvard.edu/jalali

Jessica Kaiser

Massachusetts Institute of Technology (MIT), Students ( email )

Cambridge, MA
United States

Michael Siegel

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

Stuart Madnick

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

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