Wink issues an ultimatum: agree to mandatory subscription or be shut off

Shawn Knight

Posts: 12,318   +120
Staff member

Smart home device maker Wink set off a firestorm of criticism this week with its announcement that it would soon be moving to a mandatory subscription model.

Up to this point, Wink has relied solely on the one-time fee derived from the sale of its hardware at the time of purchase. Long-term costs and recent economic events, however, have put additional strain on the business. Rather than sell user data to the highest bidder, Wink has decided to go the subscription route.

Wink’s new subscription service is priced at $4.99 per month and was “designed to be as modest as possible.” The company said users’ support will enable them to continue providing the functionality they’ve come to rely on and focus on accelerating new integrations and app features.

What’s the big deal, you ask?

Well, Wink is giving customers just one week to make a decision. Starting May 13, users will either need to agree to the mandatory $4.99 monthly fee or lose access to the devices they’ve already purchased. Automations will also go dark on this date unless you sign up.

Predictably, the move is going over about as well as any reasonable person could expect. And by that, I mean users are quite upset at the suddenness of it all. Many feel that by giving just one week’s notice, Wink is exposing that they are in a dire situation.

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wiyosaya

Posts: 5,265   +3,378
IMO, this is not a way to endear your customers. It also sounds like it could be outright fraudulent or false advertising. "Buy our device for $49.00." Then after the sale, "Oh, by the way, we forgot to mention that in order for you to use the device, you must pay us $4.99/mo or we will disable the device."

I would not be surprised if this goes to the FTC at least, nor would I be surprised if some Attorneys General pursue charges against them.

It sounds like this company is desperate for business, however, this is not the way to get people to buy your product.

Given their apparent and implied focus on revenue, I would not be surprised if this also has as yet undiscovered security flaws.
 

mailpup

Posts: 7,561   +709
TS Special Forces
IMO, this is not a way to endear your customers. It also sounds like it could be outright fraudulent or false advertising. "Buy our device for $49.00." Then after the sale, "Oh, by the way, we forgot to mention that in order for you to use the device, you must pay us $4.99/mo or we will disable the device."
Indeed. Sounds like the classic bait and switch.
 
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Uncle Al

Posts: 7,101   +5,459
This reminds me of that little product they hawk to see your heart beat & send the report to your doctor. They say it only cost $99 but fail to mention that after 30 days they shut it down if you don't agree to the monthly fee that was never previously mentioned! Scam artists come in so many different shades .......
 

captaincranky

Posts: 16,066   +4,866
Not a legal expert, but it does seem like there could be grounds for one. Unfortunately, if the company is this desperate, they might not have much money left to begin with, thus a lawsuit would probably be pointless.
It might be very well true, that people might not get huge damage sums from the company, since they could just declare bankruptcy. At that point any "injured party might be able to recoup a small portion of the purchase price of the original device. It would be a good long wait as well.

However, customers would still get the satisfaction of contributing to putting them out of business. Although, that wouldn't be a monetary gain, but emotionally satisfying nonetheless.

This action by a company follows a typical template for failing businesses.

First, you're not moving enough product to meet costs.

Then you raise prices to customers you still have.

More and more people bolt due to the price increase, which only accelerates the ultimate failure, but definitely doesn't prolong corporate viability.
 
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