Security expert Bruce Schneier, writing for Motherboard:
The security of our computers and phones also comes from the fact that we replace them regularly. We buy new laptops every few years. We get new phones even more frequently. This isn't true for all of the embedded IoT systems. They last for years, even decades. We might buy a new DVR every five or ten years. We replace our refrigerator every 25 years. We replace our thermostat approximately never. Already the banking industry is dealing with the security problems of Windows 95 embedded in ATMs. This same problem is going to occur all over the Internet of Things.
The market can't fix this because neither the buyer nor the seller cares. Think of all the CCTV cameras and DVRs used in the attack against Brian Krebs. The owners of those devices don't care. Their devices were cheap to buy, they still work, and they don't even know Brian. The sellers of those devices don't care: they're now selling newer and better models, and the original buyers only cared about price and features. There is no market solution because the insecurity is what economists call an externality: it's an effect of the purchasing decision that affects other people. Think of it kind of like invisible pollution.
Bruce nails it here. I don't have any IoT devices in my house because the last thing I want to do is worry about firmware updates and security settings for a bunch of products made by companies with sketchy (at best) track records in software and security. Normal consumers don't even think about this stuff, and the incentives aren't there for manufacturers to care either.