JLG raises some excellent points and points to some excellent critics, including the Internet of Shit twitter account.

Some elements to highlight:

We had this problem in consumer electric goods, starting slightly over a century ago. Poorly-made devices could electrocute users, burn down homes (or offices or factories), would fail to work as advertised, fail to work, or otherwise disappoint. The result was that, at the instigation of insurance companies, an independent testing and certification service was created, Underwriters Laboratories. UL are actually looking at entering the IoT/IoS morass: http://www.csmonitor.com/World/Passcode/2016/0405/Can-testin...

More complex products make for more complex assessments. One of my most useful and oldest household purchases is also one of my oldest: a cast-iron frying pan bought 30 years ago. It functions as it did when I first bought it, I've used it daily for decades, and its function was immediately evident. Contrast the tablet and keyboard on which I'm typing this, neither of which have lived up to expectations (nor the manufacturers to their warranty obligations -- Samsung and Logitec respectively). With hardware, control interfaces, communications, server dependencies, bugs, security vulnerabilities, and more, IoT devices are vastly more complex than what they replace.

Poor margins make for poor products. This seems far less well understood than it ought, particularly among the HN crowd. An undercapitalised company, or one operating on a burn-rate and prayer, or some overseas firm you've never heard of, trying to crack your local market, may well choose to skimp on quality options. Vendors who care nothing other than order fulfillment and logistics (Amazon, WalMart, Best Buy) have no vested interest in product quality. Quality itself is a difficult metric to assess, particularly lifetime quality.

Product / vendor lock-in is a consequence of this. Rather than make money on initial purchase, various forms of subscription-based services are offered, or interconnectivity is provided ... as an ad-on, additional-cost, feature.

Unintended consequences are a real bitch. This is an area of market failure I've been exploring which seems highly underconsidered in contemporary economics. While Akerloff's "Market for Lemons" gave us a fuller awareness of information asymmetries, I'm not aware of a general treatment for a simple inability to know the salient future outcomes of current actions. Consider Thomas Midgley, Jr.'s contributions of chlorofluorocarbons and tetraethyl lead, used in leaded gasoline. He's done more than any other engineer to put all of humanity at risk. And while lead was a known pollutant by the 1920s, the effects of CFCs on the ozone layer wasn't discovered for another 50 years. Long-lingering systemic effects are particularly pernicious.

"Smart" products only offer so much additional capability. The ability of added logic or communications to a device to increase value is limited by the mode through which that object operates. Take Google's recently announced energy savings AI applications. The multi-millionfold increase in computer processing capabilities, combined with a decade's hard work at improving AI ... can deliver a ~15% energy efficiency improvement. In a Moore's Law scenario, this is about a four-month advance in processor capabilities, and given interactions of the Jevons Paradox, the end result is likely to be increasing energy utilisation, not decreasing it. Similar results are seen for automotive and aircraft control systems. Net increases in efficiency from millionfold processer capability improvements are, at best, a factor-of-two doubling, and often far less.

There are examples of marked improvements, with the multiple factors compounding in shipping markets a good example: containerisation, standardisation, improved dockside handling, intermodal rail and trucking, invoice and manifest controls, etc., have increased the efficiencies (and decreased the costs) of shipping markedly. Of course, the result is that far more goods are shipped, and labour rates in advanced countries have fallen tremendously with falling negotiating advantage.

Complexity increases failure modes. The more interconnections and mutual dependencies a thing has, the more ways it can fail. Any individual or combination of possible interactions needs be considered. Multiple systems with complex interactions compound this. The alternative is fully modularised and independent systems.

E.g., rather than a fully integrated "IoT" refrigerator, specific sensing, control, and communications modules might be provided to monitor power, temperature, contents, and communicate these.

Taking my tablet example -- apparently cases designed to specific device dimensions make the interchangeability of what ought be completely separate systems complex.