Appliance manufacturers are upset that 50% of customers will not connect smart appliances

Enlarge / This hypothetical dishwasher owner is one of a minority of smart appliance customers who get the full value of their device, including timely reminders to purchase more of the company’s recommended dishwasher tabs and cleaning packages.

Dani Serrano/Getty Images

Appliance manufacturers like Whirlpool and LG just can’t understand. They added Wi-Fi antennas to their latest dishwashers, ovens, and refrigerators and built apps for them—and yet only 50 percent or fewer of their owners have connected them. What gives?

The problem, according to manufacturers cited in a Wall Street Journal report (subscription usually required), is that customers just don’t know all the things a manufacturer can do if users plug in the device that rotates their clothes or holds their food cold – things like “providing manufacturers with data and insights about how customers use their products” and allowing companies to “send over-the-air updates” and “sell relevant parts or subscription services.”

“The challenge is that a consumer doesn’t see the true value that manufacturers see in terms of how this data can help them in the long run. So they don’t care to spend time just connecting it,” said Henry Kim, US director of LG’s smart device division ThinQ, to the Journal.

LG told the Journal that less than half of its smart appliances — which represent 80-90 percent of its appliances sold — remain connected to the Internet. Whirlpool reported that “more than half” are connected. Wi-Fi connected smart devices may be connected when they are first set up, but a new ISP, router hardware, or Wi-Fi password can take the device offline. And a smart oven will likely be way down the list of devices to reconfigure when that happens.

That means companies like Whirlpool are missing out on service revenue, which is increasingly crucial for manufacturers facing rising input costs, declining replacement purchases and hungry shareholders. Whirlpool acquired recipe management app Yummly in 2017, and its customers can sync a Yummly Pro subscription to a smart oven so it follows recipe instructions (which apparently sometimes need to go beyond “heat to this level”).

For its part, LG saw an incremental increase in water filter sales as it tracked water volumes on connected refrigerators versus non-connected refrigerators, the company told the Journal. Both companies also suggested that new features, including security alerts, be rolled out to connected customers.

Whirlpool told the Journal that customers “have the option to opt in or out” of sharing data with the company. LG doesn’t offer that option, but Kim told the Journal that “all data is anonymized.”

While manufacturers blame technical limitations, some customers may simply not want to give companies vague privacy policies or bad histories with security access to their networks.

LG smart TVs were found in 2013 to upload extensive data to their servers about all the activity that happens on them, including viewing files on USB sticks. At the time, LG admitted it collected this data, but it suggested the data was “not personal” and was only used for ad targeting or as part of software projects that were discontinued. LG is far from the only TV manufacturer to participate in automated content recognition, but it is one of a select few that also makes a dishwasher.

More generally, smart home (or Internet of Things or IoT) devices are all too often built with an “acquire, upload, whatever” mindset. Take the test models from iRobot/Roomba (up for potential acquisition by Amazon) that uploaded images of a person on the toilet to the cloud. Or one of the dozens of devices described in an Institute of Electrical and Electronics Engineers study, a Northeastern/Imperial College study, or the Mozilla Foundation’s “Privacy Not Included” list. The problems are so widespread and varied that the White House has called for universal IoT security labeling.

Appliance manufacturers are eager for buyers to plug in their smart devices, but at least some might think they’ve done the smart thing by letting them work offline.

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