Insteon finally admits to sudden shutdown of smart home

Smart home company Insteon and its 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 warning customers at all, resulting in the unexpected shutdown of many smart home devices that relied on Insteon’s cloud.

Insteon CEO Rob Lilleness did not answer a single question from the media about why his company suddenly dropped its customers, choosing instead to clear its LinkedIn information page. First, the absent CEO removed his Insteon position from LinkedIn and then cut out his name and photo. Finally, he deleted his entire LinkedIn account. (An archive of the Insteon “Leadership”page starring Rob Lilleness has been preserved here for posterity.)

Insteon finally updated their website (archived here) and pinned a farewell message at the top of every page a full 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 issues. The company was looking for a buyer, but did not find.

The statement says, in part:

In 2019, with the onset of the global pandemic, the market experienced unforeseen turmoil, but the company continued to move forward. However, the subsequent (and prolonged) supply chain disruption caused by the pandemic proved incredibly difficult, and the company began the sales process in November 2021. The goal was to find a parent company for the company and continue to invest in new products. and technology. The process resulted in several interested parties and the sale was expected to go through in March. Unfortunately, this sale did not take place. Consequently, the company was taken over by a financial services firm in March to streamline the company’s assets.

The part about the company’s “asset optimization”- combined with the fact that Insteon’s cloud servers don’t seem to be running forever – makes it look like the company is going out of business. The post doesn’t put the final nail in Insteon’s coffin, but it does say there is still “hope that a buyer can be found for the company.”When more widely interoperable technologies such as Zigbee, Z-Wave and the upcoming Matter are subject to licensing, it’s unclear what anyone would want to buy from Insteon. Of course, the value of the Insteon brand should be close to zero after this reputation-damaging escapade.

Insteon ends its statement by saying, “We hope the Insteon community understands the tireless efforts of all staff to serve our customers, and [we] deeply apologize to the community.”