In a surprise blog post on Wednesday, Wink said that it was eliminating free services and moving to a subscription model next week. For what the company called a "modest" fee, customers who have never needed to pay for smart home control will need to pay $5 per month for access to Wink devices. The subscription model starts on May 13.
"Should you choose not to sign up for a subscription you will no longer be able to access your Wink devices from the app, with voice control or through the API, and your automations will be disabled on May 13," Wink said in a statement. "Your device connections, settings and automations can be reactivated if you decide to subscribe at a later date."
Wink has been in business since 2014, selling hardware to customers with access to their devices and other smart home controls at no additional charge. Wink said it needs to supplement hardware sales with subscriptions to continue to offer its service.
The announcement doesn't sit well with the Wink's customers, who have lit up Reddit and Twitter with complaints about the move. One user, who has received several upvotes for the comment, said the move is tantamount to "extortion."
"This is pure extortion," the person wrote. "If you don't pay us in 1 week, you can't use any of the lights in your house." Without a subscription, Wink devices will essentially become expensive bricks with no real value.
Wink, which hasn't responded to an Inc. request for comment, has reportedly been feeling a cash crunch for months. In November, in fact, the company, which is owned by music artist and investor will.i.am's company i.am+, was reportedly behind on paying staffers.
It's possible that Wink's move to a subscription is an attempt to stay afloat. And on the face of it, moving to a paid model isn't a bad idea. But Wink's method for doing so is a clear lesson in how not to move to make big changes in your business model.
For one, the company has long promoted its free platform to attract customers. Perhaps most important, Wink announced the news only on Wednesday and said it would go into effect next week. That's too quick of a transition--especially at a time when consumers are worried about their household budgets--and one that has understandably angered people.
Indeed, Wink's move, even if it was designed to save the company, is an example of how not to handle a major change in business strategy. And it could go down as the main reason Wink ultimately fails.
As for what's next? Wink has few choices. All it can do is apologize and extend the subscription timeline out. If it doesn't, it's hard to see how Wink can look good coming out of this decision.