Recent developments in smart home and internet of things (IoT) technology would be unimaginable a few decades ago. Automated homes are increasingly looking like something out of The Jetsons: users can talk to their refrigerators, monitor the status of most smart devices using their phones and turn off their lights from thousands of miles away.
As amazing as the IoT is, it was bound to lead to a glut of overengineered products. When the sky (or Wi-Fi bandwidth) is the only limit, it was only a matter of time before a few products overshot the average IoT user’s utility.
On December 27, Otto CEO Sam Jadallah published a statement saying his company was ceasing operations. Otto was founded in 2013 to develop a Wi-Fi/Bluetooth door lock to replace existing deadbolts. According to the company’s website, it sought to “[eliminate] the most vulnerable aspects of a mechanical lock while offering unparalleled design and performance.”
Otto's Wi-Fi door lock. Source: OttoThere’s little doubt that Otto’s lock was a neat development. User testimonials commented on how convenient it was to go for a jog without jangling keys and be able to re-enter a locked home with a touch of a finger. Otto users were able to grant access to their friends and family from their phones, so a user throwing a party could choose to only allow invited guests to enter their home.
Beyond these features, though, drawbacks took over. Otto was to retail at around $700, exponentially more expensive than an average deadbolt. Otto claimed that their product was more secure than a conventional lock because it eliminated the possibility of picking the lock, but the possibility of hacking the device seems like more of a dangerous threat than a conventional break-in.
Jadallah’s statement ultimately points to a failed acquisition bid as the cause of the shutdown, but this was likely not the only factor. Hardware startups are notoriously difficult, and Jadallah and the board seem to have made some critical mistakes during the company’s history. Most online user backlash asked a simpler question: Who would pay hundreds for a potentially hackable smart lock?
Juicero: A Similar Story
The well-publicized story behind the rise and fall of Juicero has similar overtones. Juicero was also founded in 2013 and touted a Wi-Fi enabled “smart juicer” that only worked with specially made product packs costing between $5 and $7 each. The Juicero press itself initially retailed for $699 in March 2016, but the company slashed the price to $399 less than a year later in response to slow sales.
Juicero's press and produce packs. Source: JuiceroJuicero benefited from significant hype, and it raised $120 million in 2014 from such high-profile investors as Google parent Alphabet Inc. In April 2017, Bloomberg delivered a devastating report detailing how the company’s produce packs could be easily squeezed by hand, yielding the same amount of juice as the nearly $400 press. The article contributed to Juicero’s demise last September, when the company began buying back its juicers.
Shortly after the Bloomberg article, several sources performed teardowns on the press and found it to be masterfully overengineered. It used mostly custom parts to apply precise pressure across the entire 64 square inches of the juice bags. The parts — including 10 custom-injection-molded components, precisely rounded pieces and a precision drivetrain — led to the unit’s exorbitant price, which was ultimately far too expensive for the company’s target demographic.
In addition to the precision mechanics, the Juicero press was Wi-Fi enabled. Each produce bag was labeled with a QR code. The Juicero press would not press a bag until it scanned and verified the label, ostensibly to ensure the bag was fresh. A 2016 Business Insider article suggested an underlying reason for this: Juicero did not want third-party juice packs used in their press. While this motivation shows good business sense — the Keurig market is rife with non-Keurig K-cups, for example — it severely limited the Juicero press’s utility.
Where is the IoT, and Where is It Going?
Gartner's 2017 Hype Cycle shows IoT and connected home nearing peak hype. Source: Gartner
These two overengineered, overpriced IoT-enabled products signal that the smart home may soon reach peak hype. Sure enough, Gartner’s 2017 Hype Cycle for Emerging Technologies shows IoT platforms and the connected home are at or nearing their “Peak of Inflated Expectations.” According to the hype cycle principle, this peak is usually followed by a downward spiral into the “Trough of Disillusionment” on the way to a steady period of widespread acceptance and productivity.
Gartner predicts that IoT platforms should plateau within the next two to five years, while the connected home plateau may be further out. Until then, expect to see more overreaches like Otto and Juicero.
