So let me get this straight. You buy Phillips Hue devices because they work offline. Then they change how the devices you bought function making them only work online forcing you to create an account and allow them to collect data.
This should not be legal. This is a breach of contract, they modified the contract after you already signed it (by buying the device). If they want to do this, they should offer full refunds to anyone that wants to exit the contract, or only apply the changed to new devices.