Stuff is going to get even worse when IoT devices begin using IPv6. By design, devices are publically reachable and not hidden behind a NAT router, which makes RCE exploits way, way easier.
I'd take a guess that loads of IoT devices have "backdoors" like open SSH/telnet with insecure default passwords, too - the same shit that hit el-cheapo routers, for example.
Is that true? I just setup IPv6 at home yesterday and I don't see the difference from IPv4 in terms of reachability. The default policy on my firewall for incoming traffic for both IPv4 and IPv6 is drop.
Yes, NAT can give you a pseudo-firewall in that LAN devices aren't given publicly routable addresses, but I have no idea why anyone would leave their IPv6 network completely open "by design".
IoT devices like surveillance cams, VoIP babyphones etc. have two options:
1) depend on third-party servers for operation, so no outside-to-device-initiated communication is needed. Downside: costs money to run the servers, and just imagine the sausagefest when a camera cloud server gets hacked. Upside: you can firewall off your private network as you like, and the device will still work.
2) allow the owner of the device to directly connect to the IoT device via IPv6. Downside: everyone and their dog can access (and exploit) your devices, provided that they know the IP address. IPv6 addresses are long and pretty random, but e.g. if the MAC address is used for assigning the IPv6 address, not so random any more. Upside: no SPOF/centralized node that turns your device into a brick if the operator shuts down.
Basically, the only way to "securely" operate IoT devices is inside a separate VLAN. FritzBox routers can do this, but not many others, e.g. because the router can't independently manage the Ethernet ports, because it's cheaper to put in a GBit switch than to choose a SoC that's beefy enough to drive four GBit ports individually. I put "securely" into quotation marks, as a hacked surveillance cam or babyphone is an open invitation to any hacker.
Not sure that word means what you think it means.
This is a major pain to configure, and way beyond the capacity of even most IT professionals. One of the problems is that you do want to allow some devices (phones) from the 'normal' network to (selectively) be able to connect to devices in the IoT vlan.
I spend a solid day trying to set this up once (and on a 'real' switch, not a Fritzbox which I have too but only use as modem) and I'm not saying that I'm that good a networking guy (I mean, that I wasn't able to it working means I'm not) but I do know more than the average internet installation guy who would be the only hope for 'regular' users to set up their networks properly.
Some things just do not make much sense without being able to control them remotely. A separate VLAN for devices would only allow them to communicate with another which probably is not what you want. BTW. i could not set up VLANs on a fritz box with FritzOS last time i tried. However nearly all routers with OpenWRT will do without a problem.
Although this wont be practical for any device that is not a phone or a (desktop) computer.
Unfortunately, this belies the meat of the issue with IoT. After you've bought the router, there's no reason for your router's manufacturer to keep updating the firmware and fix bugs that allow an XSS attack, and even if the manufacturer does upgrade the firmware, there's no no way for the manufacture to force the firmware to be updated on all of the devices that have been sold, hence installed devices with older firmware that's been exploited and is now part of the botnet used to attack Krebsonsecurity.com
Separating the IoT stuff (at least the stuff that needs connectivity from outside) into its own VLAN at least prevents a hacker from gaining access to the rest of your home network (e.g. NAS devices or your normal computers).
While this would as you said protect my other networks to some extend it does not solve the problem. I will not ever trust these devices to get secure enough to expose them directly to the internet.
This is why i am thinking the only way to operate these devices securely is to require some kind of transport protection in form of an IPsec tunnel for example. This would allow me and anyone with the right set of access to control the devices without making them accessible to anyone else.
If home routers would encourage the use of such tunnels it would be a normal thing to have a link back to your home network (or maybe a separate IoT network) which could be properly firewalled...
Also, you still have to receive the traffic even if you then ignore it; if your pipe is smaller than the attacker's, it may be enough to overwhelm you.