The Internet Of Things Might Have Some Problems

A few years ago, I went to the Solidworks World conference in San Diego. Every morning they would run what they called  general sessions where various speakers would come in and boost whatever they were boosting.  The head of Quirky gave a speech on Quirky, Mike Rowe talked about MikeRowe works and Tony Faddel talked about the NEST thermostat.

I’ve posted about this before. I discussed the need for modularity and backward compatibility for the appliances and controls that inhabit your house.  Unlike of much of the stuff in the digital world the appliances and controls in your home have a direct impact on your life.  “Failure is not an option” for very long is how most of that stuff works.  So home appliances shutting down due to internet glitches is not a good thing. That post is right here:

The following elaborates on that.

Ten years ago, if you had told people they could make millions off a specific coffee machine that would only take one type of pods, made by the creator of the machine, they might have laughed at you — but then Nespresso came along and ate the world of drink-at-home coffee.

Yes, it learns about your home, which is both good and… well, slightly discomforting.

Now the same is happening with your every day gadgets, but in a slightly more sinister, under the surface way. Companies want to internet-connect your entire house in order to collect more data on you.

The opportunities are delicious for bloated internet companies: now a software company could know how warm your home is, what times of day are noisy, whether you have a pet, when you turn on your lights or if you listen to music while having sex.

Smart devices are sold as a way to improve your life — and in many ways, they do to an extent — but it also means those gadgets are incredible troves of data that could eventually turn into Software-as-a-Service money makers, just like Nespresso did to coffee.

The problem with the Internet of Things is that the hardware is only one aspect. The makers need to keep servers running to support them, keep APIs up to date, keep security up to date and, well, pay employees.

We’ll get more and more services revenue because the hardware sits on the wall for a decade.

— Tony Fadell

That, eventually, costs more than it does to actually sell you the device. Probably in less than the first twelve months of you using it. That’s not sustainable, and no Internet of Things company has found a better way yet.

If Nest wanted to increase profits it could sell your home’s environment data to advertisers. Too cold? Amazon ads for blankets. Too hot? A banner ad for an air conditioner. Too humid? Dehumidifiers up in your Facebook.

To be clear, that hasn’t happened yet but Nest already shares “anonymous” data with “partners” and Google just happens to be in the business of showing you ads for things. It’s something that will eventuate.

Long term this will absolutely happen with the sheer majority Internet of Things devices — after the shakeout when everyone realizes it’s fucking impossible to make money from online coffee cups.

Ten years ago, if you had told people they could make millions off a specific coffee machine that would only take one type of pods, made by the creator of the machine, they might have laughed at you — but then Nespresso came along and ate the world of drink-at-home coffee.

As the market eventually saturates and sales of internet-widgets top off, you can bet that everyone from the smallest to largest vendor will look to what’s next: the treasure trove that is everything it knows about you.

Many of the newest IoT devices are the types of household appliances you won’t replace for a decade. We’re talking about a thermostat, fridge, washing machine, kettle, TV or light — long term, there’s just no other way to be sustainable for the creators of these devices.

There is an alternative path that some could take: maybe Nest needs to increase its revenue, so it decides to charge a monthly subscription model for its thermostat. Now you need to pay $5 per month or it’ll lock you out.

The question then, is if you’d pay for it? Will you pay for a subscription for everything in your home?

Maybe: if the device comes for free, with that subscription, and guarantees your data will be kept private… but I suspect that many people prefer to own outright and simply won’t care about the privacy compromise.

The future of your most intimate data being sold to the highest bidder isn’t dystopian. It’s happening now.

Take this article on AdAge as an example, that quotes the maker of an internet-connected fridge as saying:

“We are trying to understand how to impact consumers’ lives in meaningful ways,” Ms. Andrews said. “It was interesting to see what people were doing with our products — like what time they are buying things and when — it is a wealth of knowledge.”

“I think you will see a move of brands starting to look at this space as a new revenue stream,” she added. “We didn’t make a fridge initially to make a ton of money, but in a year or two, it can make revenue, absolutely.”

Even Nest already came to this realization. Its founder, Tony Fadell, told Forbes in 2014 that “We’ll get more and more services revenue because the hardware sits on the wall for a decade.”

No shit, because your data is valuable perpetually since that thing sits on your wall quietly observing without you knowing.

Yes, now we know exactly what you’re doing with it

I own a ton of these devices already: a Tado thermostat, Sonos speakers and Hue lightbulbs. It just kind of happened before I realized it.

Like you, I was sucked in by many of their marketing charms, like Nest, which promises it “never stops learning” to make your heating better.

When faced with this or a boring-old version, almost all of us think along the lines of “You mean I don’t have to fiddle with buttons? Sign me the fuck up!”

But what are we giving away? Where is our data going? Who really owns our devices in this bold new future?

When stuff has to work, the glitches that happen on the internet could possibly wreak havoc. Do we really want to put control of the heat in our homes on an outside server we don’t control? One that can’t be bypassed?

It works in the commercials, but the reality isn’t that fixed.

The reality is that servers fail, the wifi  and internet goes down and the power does go off occasionally.  A regular thermostat doesn’t care, and without the being able to turn something off while you are away, you usually make plans for dealing with that one way or another. After all people have been doing without connected houses since the beginning of time. They make adjustments.

The problems start when that server that your device is hooked up to goes down or disconnects for any other reason.

It’s certainly a clever idea for easing the task of managing your pet’s eating habits and sticking to a rigid schedule – all while allowing you to control it via the cloud.

Unfortunately, the device relies far too much on receiving instructions from a central server. So when its systems went down earlier today, Petnet feeders stopped dispensing food as per the schedule users had set – which means poor Fido will have had to go hungry for hours on end.

That’s a nightmare for pet owners and a potential goldmine for lawyers who specialize in class action cases.

The trouble with the Internet of Things is that it seems to have developed into a buzzword for just about any hardware company to latch onto. Accounting for security issues, fallbacks in case of outages and device failures are all par for the course for more mature product categories (and we still have trouble with some of them). Sadly, these don’t seem to figure into the plans of most IoT firms.


This is why I’m still wary of the Internet of Things

That’s just an unhappy dog or cat.  It could be worse. suppose the device has a heating element in it and it doesn’t shut off.  Or it’s below freezing and the remote thermostat shuts down and the pipes freeze.  I’ve been through some frozen pipes over the years and trust me, you don’t to have to deal with that problem. Or some of  the other things that can happen in a house or apartment.

Finally there is the security issue.  I was hit by ransomware last month and had a ton of my files put into encryption.  suppose instead the lock and security system for your home are held for ransom?  With the setup that the system no longer identifies you, as you.  Or the hackers sell hacked homes to squatters that just move in. Or crooks who take all your valuables.  The Internet Of things people are going to have to address these issues before things go on much further.


  1. MishaBurnett · July 29, 2016

    When I was a locksmith I saw a lot of homeowners who used a garage door opener as a front door key. They locked the external doors, unlocked the connecting door between garage and house, and didn’t bother to carry physical keys. When they get home from work, they just click the opener button and drive in. Simple, right?

    Until the power goes out. Or the battery in your remote dies. Or you get a rental car and forget to take that little box off your sun visor. Or come home to find the garage door open and your house unsecured because your neighbor saw what a great idea you had and decided to install his own garage opener, and neither of you bother to change the default dip switch settings. (I recall one subdivision where the houses all had the same model garage door opener and the contractor just installed them all out of the box. I ran at least a dozen calls in that development to change remote settings.)

    And that was before the internet or the cloud.

    That’s what I think of when I see the displays for cloud enabled products in the hardware stores. I think (I hope, anyway) that the early 21st Century will be remembered as the era when the human race learned that just because you can put a computer into something doesn’t mean that putting a computer into it is a good idea. For some things (the things that really need to work, all the time, no matter what) a brute, dumb, mechanical linkage is still going to be your best design choice.

    One of the buildings on campus has a new Building Management System. During the winter we had a power glitch that crashed the computer. The outside air dampers all stuck open and the hot water boiler went out. When the office workers showed up the building was cold–but the real fun started when we got the heat back on. See, it’s a hot water heating system and all of the radiators in the units above the drop ceiling were full of unheated water that was exposed to sub-freezing air flow for several hours. As soon as the ice in the pipes melted the entire third floor was treated to an internal rainstorm.

    Contrast that with my home, where I have an old school thermostat with a bimetal strip and a mercury switch. In the ten years that I have lived there I have never done any maintenance on it at all, and it still works flawlessly. It doesn’t change the temperature when I am out of the house, true enough, but honestly, I think I like it that way.


  2. MadRocketSci · July 29, 2016

    How do these companies frantically collecting dossiers on their users end up profiting from them in the end? Who buys all this stuff? I can imagine how it’s a secret-policeman’s dream to have giant piles of blackmail material on everyone everywhere, but it doesn’t seem that the CIA/NSA are the chief customers of the current silicon valley crowd. Why do companies spend so much money (hundreds of billions, if the valuations of these companies aren’t another cooked up bubble) on advertising? How much more effective could an ad possibly be, if you know what user #101,001 eats for dinner and when he leaves his house? How do manufacturing companies with razor thin margins even afford buying ads driven by all this obsessive data collection and parsing?

    Liked by 1 person

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