And what about disabled folk who might rely on the smart functionality of the house to have something resembling an independent life? Or the elderly? Even if e.g. a smart bulb fails gracefully and becomes a non-smart bulb in the absence of the cloud, it doesn't help if you have cannot operate a normal light switch effectively.
A lot of comments on this article seem to think smart home devices are only for the lazy or are toys for people with more money than sense, but there are plenty of "legitimate" use cases as well.
Also, while I would never want to use it myself, relying on the cloud is perfectly valid - the simple fact is most people are incapable of hosting and maintaining their own smart hub [1], and Insteon fucked up big time by not having a better transition plan.
[1] https://www.nngroup.com/articles/computer-skill-levels/ The source is paywalled, but this article is a decent summary. TL;DR if we assume running your own smart hub is a "level 3" task, only about 5% of people in a country would be capable of doing so.
Again, the house just becomes non-smart. What about them? You can't say "I prefer dumb homes because smart homes might stop being smart" "Yeah but then they just become dumb" "But what about people who can't have dumb homes?"
That's not an advantage of a dumb home, it just sucks for people who rely on something when the something stops working.
Note this isn't what happened in this case, but it is a worst case scenario.
Many people I know with smart home stuff enjoy the tinkering a bit, and find its another thing to be restless about and fiddle with, and don't "set and forget" anyways.