Giulio Tononi's integrated information theory (IIT) proposes explaining consciousness by directly identifying it with integrated information. We examine the construct validity of IIT's measure of consciousness, phi (Φ), by analyzing its formal properties, its relation to key aspects of consciousness, and its co-variation with relevant empirical circumstances. Our analysis shows that IIT's identification of consciousness with the causal efficacy with which differentiated networks accomplish global information transfer (which is what Φ in fact measures) is mistaken. This misidentification has the consequence of requiring the attribution of consciousness to a range of natural systems and artifacts that include, but are not limited to, large-scale electrical power grids, gene-regulation networks, some electronic circuit boards, and social networks. Instead of treating this consequence of the theory as a disconfirmation, IIT embraces it. By regarding these systems as bearers of consciousness ex hypothesi, IIT is led toward the orbit of panpsychist ideation. This departure from science as we know it can be avoided by recognizing the functional misattribution at the heart of IIT's identity claim. We show, for example, what function is actually performed, at least in the human case, by the cortical combination of differentiation with integration that IIT identifies with consciousness. Finally, we examine what lessons may be drawn from IIT's failure to provide a credible account of consciousness for progress in the very active field of research concerned with exploring the phenomenon from formal and neural points of view.