In October, we brought together three people who've deployed IoT across hundreds of thousands of HVAC units: Peachie Maher from Rheem Commercial Water, Mark Adams from Mitsubishi Electric Trane, and Joe Lang from Comfort Systems USA.
They didn't sugarcoat it. The conversation covered failed installations, bad vendor choices, dead business models, and what actually moves the needle when you're connecting equipment in the real world.
Here's what they said.
We started with the obvious question: what was the business case?
The answer surprised no one who's actually deployed IoT: it wasn't about generating new revenue. It was about operating more efficiently.
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Peachie explained Rheem's thinking: "We had products monitoring 144 different data points, but that wasn't visible when standing in front of the product. IoT gave us the ability to put all those points in one place and look at trending data. We could do faster troubleshooting."
The payoff came fast. Within weeks of testing connected units, they could diagnose issues that previously required physically opening equipment and running tests.
Mark's situation at Rinnai was different but equally pressing. They had good equipment undermined by bad IoT. "Our IoT experience made us look like a company that doesn't deliver quality," he said. The project became about fixing the user experience to match their hardware reputation.
Joe's perspective from Comfort Systems was the most direct: "Anytime we can fix a unit faster, we create more scale without growing our technician base. With 2,700 technicians, the skills gap is real."
Translation: IoT helps you do more with the people you already have. That's the ROI pitch that works.
Everyone talks about IoT enabling subscription models in HVAC. The panel's answer was blunt: it didn't happen in residential, and it probably won't.
Mark put it simply: "On residential, subscription is really unheard of. Any model needs to go through what benefit you provide the contractor."
Peachie agreed: "Having connected product has become a standard expectation. While in 2018 we might have thought of a pay-for-use model, now it's an expected cost of the product."
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Here's what changed: between 2018 and now, connectivity went from premium feature to table stakes. Customers expect it. Charging extra for it doesn't work when your competitors include it.
The exception is commercial equipment, but even there, the model runs through contractors. Joe explained Comfort Systems' approach: "We provide uptime as a service, which gives us different pricing structures. It's about changing the overall model, not just adding a subscription fee."
The lesson: if you're banking on subscription revenue from connected residential equipment, adjust your financial models. That ship sailed.
This is where the conversation got uncomfortable. Technology wasn't the problem. Getting installers to actually connect the devices was.
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Peachie identified this as their biggest failure: "Installation caused us the most issues. Installers are plumbers or contractors or boiler experts, they don't have IT backgrounds. Once they have to call IT, it's game over."
The failure pattern is consistent:
Mark shared numbers from Rinnai: "We were including the connected solution for free, and probably 60-70% weren't getting installed."
They redesigned everything for simplicity. The result? Mark got a call from a contractor who'd previously complained constantly: "I just tried the new adapter and app, got it working within five minutes. Just wanted to call and say you actually fixed it."
Joe's solution at Comfort Systems was even more direct: "We went cellular right off the microprocessor. You turn it on, it makes the phone call, it works. Getting on customers' Wi-Fi is almost impossible these days."
The pattern is clear: if your connection process requires more than five minutes or involves calling IT, you've already lost.
The panel got honest about vendor decisions and internal development.
Mark shared his experience with proposals for a mobile app redesign at Rinnai: "We got estimates ranging from $50,000 to $2 million. It's tough to figure out who's the best based on price points."
His first vendor choice delivered attractive UI but couldn't deliver stability. The app got bad reviews. The system had downtime. "The biggest thing I would have changed: switching partners faster. I was nervous about changing because they already knew where the problems were, but that ended up biting me."
That's a common trap: staying with underperforming vendors because they already understand your mess. Mark's lesson: the cost of switching is usually less than the cost of waiting.
At Mitsubishi Electric, they brought development in-house. Mark explained the tradeoff: "When I need to see an engineer, I just go see them. But because we're a manufacturing firm, not an IoT firm, we don't always have people who've done the newest and best. We tend to lag on technology."
Joe at Comfort Systems took a different approach—building their own hardware: "We've got over 300,000 assets under contract. The vast majority are more than 5 years old—high 80% range. We needed something that would work on any piece of equipment, in any location."
Their strategy: keep costs low enough to deploy devices as operational tools, not revenue generators.
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Mark's summary advice: "There's a lot of uncertainty and opportunity to get it wrong. You either have to constantly look for the right people to bring into your organization, or you need to find a trusted partner. Finding a trusted partner is very difficult in this market."
Regulations came up as both challenge and opportunity.
Mark outlined the new requirements: "Europe is requiring buildings of a certain size to have building management systems, connectivity required by law. On the West Coast, units must support automated demand response if you want to sell equipment."
Privacy adds another layer: "Privacy laws are a patchwork among countries and states. If you want a solution that bridges countries, you need to know which have the most restrictive laws and where data must reside."
Peachie sees potential in efficiency regulations: "I can see this technology being utilized to communicate actual operating conditions. High-efficiency products could be operating at lower efficiency,IoT could prove operational efficiencies."
The shift is significant: IoT is moving from "nice to have" to "required to sell" in certain markets. That changes every conversation about whether to invest.
The panel shared specific wins.
Peachie described a situation heading toward litigation: "We provided cellular connectivity to monitor the product. We were able to show what was happening within the system, proof it wasn't the product but something else. The system has been connected ever since."
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Beyond avoiding lawsuits, the data helped the customer: "It helped them troubleshoot their entire system, not just our product. A system is very complex, your IoT solution can illuminate issues throughout."
Joe's win was operational: "We built a fixed support center—technicians supporting technicians. With the platform sending information to both the dispatched technician and support center, they get manuals and troubleshooting guides before arriving. This ecosystem has helped us secure large customers, especially data centers where 24/7 support is critical."
When asked about the next 12-18 months, all three gave the same answer: predictive maintenance.
Mark explained the difference: "It's one thing to tell contractors when there's an alert. It's another to say this unit will have an issue in the next two months, go ahead and schedule an appointment."
Peachie connected it to AI: "Using AI to evaluate data and determine what signals you should use for predictive maintenance reliably, that's going to be a big part of what happens in the coming months."
Joe framed it from the customer side: "Our tagline is we want to be there before the customer knows they need us. Not letting a machine go to failure because of the compounding cost and downtime."
He also addressed AI concerns directly: "There's fear around people losing their jobs to AI. I don't think people will lose jobs to AI, but they will lose jobs to people that use AI. It's time to drop concerns and start embracing this."
The consensus: moving from reactive alerts (unit failed) to predictive alerts (unit will fail soon) is where the real value unlocks.
Why do most HVAC IoT installations fail?
Installation friction. When installers are plumbers or HVAC technicians without IT backgrounds, any connection complexity stops the process. If it requires calling IT or takes more than five minutes, it won't happen. Even free solutions see 60-70% failure rates when installation isn't dead simple.
What's the actual ROI of HVAC IoT?
Operational efficiency, not new revenue. Faster troubleshooting, fewer truck rolls, and better technician utilization drive ROI. One prevented truck roll every 6-12 months typically pays for the IoT solution. Companies see value within weeks of deployment when they focus on operational metrics.
Should you build or buy an HVAC IoT platform?
Most should partner with established platforms. In-house development at manufacturing companies typically lags on technology because IoT isn't their core expertise. The bigger risk isn't choosing wrong technology, it's staying with underperforming partners too long. Switch faster when things aren't working.
Can you charge subscriptions for connected HVAC?
Not in residential markets. Connected features became table stakes between 2018 and now. Customers expect connectivity included. In commercial settings, recurring revenue works through contractor service agreements (uptime-as-a-service), not direct subscriptions to building owners.
What connectivity works best for HVAC equipment?
Cellular offers the most reliability, especially for retrofit scenarios. Ethernet works in commercial buildings with existing infrastructure. Wi-Fi faces challenges with building IT policies and range limitations. Most successful deployments use hybrid connectivity that adapts to available networks rather than forcing one protocol.
How are regulations affecting HVAC IoT adoption?
Regulations are accelerating adoption. Europe now requires building management systems for certain building sizes. West Coast markets require ADR (automated demand response) support. These aren't optional features anymore—they're requirements to sell equipment in specific markets. Privacy laws add complexity but connectivity mandates are making IoT non-negotiable.
What's next in connected HVAC technology?
Predictive maintenance. All three panelists agreed: moving from reactive alerts (unit has failed) to predictive alerts (unit will fail in two months) is the priority. This requires AI to analyze operational data and identify failure patterns before breakdowns occur. Early wins come from preventing compressor failures and refrigerant issues.
After an hour of conversation, these themes stood out:
1. Installation kills more IoT projects than technology
If your connection process isn't simple enough for a plumber to complete in five minutes without calling IT, it will fail. This matters more than your cloud architecture, data analytics, or mobile app design.
2. Residential subscriptions failed, adjust your models
Connected features are expected now, not premium add-ons. If your business case depends on residential subscription revenue, you need a different plan. Value flows through contractor service agreements in commercial settings.
3. Switch bad partners faster than you think
Staying with underperforming vendors because "they already know our system" costs more than switching. The sunk cost fallacy is expensive in IoT development. When something isn't working, move on.
4. Regulations are making connectivity mandatory
ADR requirements and building management mandates are turning IoT from "should we?" to "how fast can we?" in certain markets. This changes the entire investment conversation.
5. Predictive maintenance is where everyone's going
The next competitive differentiator isn't alerts, it's predicting failures before they happen. This is where AI and machine learning will deliver measurable value over the next 12-18 months.
Joe's advice applies to everything: "Don't think about it. Just go do it. You got to start sometime or you're going to miss."
Start with clear operational goals. Accept that installation will be harder than you expect. Build toward predictive capabilities incrementally. Don't wait for the perfect solution, it doesn't exist.
We work with manufacturers and contractors implementing connected solutions at scale. Contact us to talk through your specific challenges, and see how Blynk can help you handle device provisioning, hybrid connectivity, and data management.
About the speakers:
Peachie Maher leads connected product development at Rheem Commercial Water, where she's overseen IoT deployments since 2018 across commercial water heating applications.
Mark Adams manages IoT products at Mitsubishi Electric Trane, focusing on commercial HVAC connectivity. He previously led IoT development at Rinnai, giving him experience across residential and commercial markets.
Joe Lang runs service technology and innovation at Comfort Systems USA, one of the largest HVAC contractors in the US, responsible for IoT strategy across 300,000+ assets under contract.
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