The thing that actually killed Blockbuster was Carl Icahn. He bought up a bunch of shares and wanted to quickly turn a profit on the company. At the time, they were investing heavily into a Netflix-like service, which required a significant up front capital investment and, therefore, was losing money. Icahn, wanting to make a profit, decided to cut spending and basically not look forward at all. He got a quick, massive bump in stock price and jumped ship as it was crashing into the iceberg. Blockbuster was caught in the middle of a paradigm shift and found itself massively under prepared to deal with it.
When I was really early in my career, a mentor told me that code review is not about catching bugs but spreading context (i.e. increasing bus factor.) Catching bugs is a side effect, but unless you have a lot of people review each pull request, it's basically just gambling.
The more expensive and less sexy option is to actually make testing easier (both programmatically and manually), write more tests and more levels of tests, and spend time reducing code complexity. The problem, I think, is people don't get promoted for preventing issues.
Perhaps I'm not totally clear on how this particular device works, but it doesn't seem like it has no ability to connect to the Internet.
Honestly, I'd say privacy is just as much about economics as it is technical architecture. If you've taken outside funding from institutional venture capitalists, it's only a matter of time before you're asked to make even more money™, and you may issue a quiet, boring change to your terms and conditions that you hope no one will read... Suddenly, you're removing mentions of your company's old "Don't Be Evil" slogan.