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The government has determined that the smart device labelling scheme it suggested last month would cost under $5 million a year.
As part of the long-awaited 2023–2030 Australian Cyber Security Strategy announced last month, the government said it was looking to introduce mandatory cyber security standards for internet of things (IoT) devices, as well as launching a voluntary labelling scheme for consumer-grade smart devices.
Following this, the Office of Impact Analysis (OIA) launched an investigation into the cost associated with the scheme.
Two voluntary schemes were analysed, with the first being a simple star rating and the second being comparable in certain aspects to food use-by-date stickers.
Consumers and manufacturers unanimously favoured the first scheme, which is already in use in Singapore.
In its findings released today (18 December), the OIA found that the cost over 10 years for the scheme would be $49.5 million (or roughly just under $5 million a year), a small price to pay in a market that nets $2.5 billion a year.
This cost would equate to $5 million for the government over the first four years, while it would cost the industry $7.8 million in the first year, followed by $4.6 million the next.
The cost of obtaining the star rating is likely to be the largest expense to the industry, which could be as much as $3,700 per device.
Reiterating the statements made in the cyber security strategy, the OIA has said that the voluntary labelling scheme would help consumers buy more secure products, similar to how the Australasian New Car Assessment Program (ANCAP) ratings advise them on the safety of a vehicle.
“A voluntary cyber security labelling scheme will provide additional guidance for consumers to inform their smart device purchasing decisions,” it wrote.
“This will help to mitigate against information asymmetries that currently exist in the smart device market, as cyber security information will become more easily accessible and understandable for consumers.”
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