insteon
Smarthome company Insteon and parent company Smartlabs Inc. suddenly disappeared last week. In what will likely be remembered as one of the most infamous smart home shutdowns ever, Insteon decided to shut down its cloud servers without giving customers any warning, surprising many smart home devices that relied on the Insteon cloud.
Insteon CEO Rob Lilleness did not respond to media inquiries about why his company was suddenly failing its customers, opting instead to scrub his LinkedIn page of information. First, the absent CEO removed his role at Insteon from LinkedIn, then cut his name and photo. Finally, he deleted his entire LinkedIn account. (An archive of Insteon’s “Leadership” page, starring Rob Lilleness, has been preserved here for posterity.)
Insteon has finally updated its website (archive here) and pinned a farewell message to the top of every page a week after the surprise liquidation. The statement – which is not attributed to anyone – says the company is going out of business due to the pandemic and supply chain problems. The company was looking for a buyer, but couldn’t find one.
The statement reads in part:
In 2019, the onset of the global pandemic caused unforeseen disruption to the market, but the company continued to move forward. However, the subsequent (and lasting) supply chain disruption caused by the pandemic proved incredibly difficult and the company started a sale process in November 2021. The goal was to find a parent company for the company and continue to invest in new products and the technology. The process generated several interested parties and it was expected that a sale would be realized in March. Unfortunately, that sale did not go through. Therefore, in March, the company was assigned to a financial services firm to optimize the company’s assets.
The part about “optimizing the assets” of the company – coupled with the fact that Insteon’s cloud servers seem to be down for good – makes it sound like the company is going out of business. However, the message doesn’t hit the final nail in Insteon’s coffin, saying there’s still “hope a buyer for the company can be found.” When more widely compatible technologies like Zigbee, Z-Wave, and the upcoming Matter can be licensed, it’s not clear what anyone would want to buy from Insteon. Sure, Insteon’s brand equity must be close to zero after this reputation-destroying stunt.
The message continues: “The pioneering work in smart lighting and world-class products has resulted in an extraordinary following and community.” Insteon’s statement does not explain why the community was not warned that a shutdown was imminent. It sounds like that period in March, when a sale fell through, would have been a great time to give your customers a month’s notice so they could plan a smooth transition. A shutdown is never easy, but warning your customers that their equipment will soon break seems like the bare minimum a company can do. Instead, Insteon remained silent for the rest of March and 15 days of April before suddenly stopping.
Insteon ends its statement with the words: “We hope the Insteon community understands the tireless efforts of all employees to serve our customers, and [we] apologies to the community.”
