Why does MQTT discovery add device name to entity name?

Configuration
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Prepending the device name is an architectural decision made a long time ago but wasn’t implemented in the MQTT integration, specifically the MQTT Discovery feature, until version 2023.8.0.

If you don’t want the device name prepended to entity’s friendly_name, you’ll need to do what you have already mentioned (manually rename its friendly_name).

I have several dozen of such entities so I used Manual Customization to modify entity names in bulk.

Copy-paste the following template into the Template Editor.

{% for id in integration_entities('mqtt')
  | map('device_id') | unique | reject ('eq', None) | sort %}
{% set name = device_attr(id, "name_by_user") or device_attr(id, "name") %}
# {{ name }}
{%- for e in device_entities(id) | sort %}
{{ e }}:
  friendly_name: {{ state_attr(e, 'friendly_name') | replace(name, '') | trim }}
{%- endfor -%}
{%- endfor -%}

The Template Editor’s results window should now contain a neatly formatted YAML listing of your MQTT-based entities, grouped by device, showing each one’s entity_id and its friendly_name stripped of its device name.

Example of what the template generated

Each entity’s desired friendly_name has been stripped of its device name (HAI Omnistat2) .

# HAI Omnistat2
binary_sensor.hvac_fan_status:
  friendly_name: Furnace Fan
climate.thermostat:
  friendly_name: Thermostat
sensor.indoor_humidity:
  friendly_name: Indoor Humidity
sensor.indoor_temperature:
  friendly_name: Indoor Temperature

Copy-paste the generated listing into the customize section of your configuration.yaml file. In my case, I have that section in a separate customize.yaml file.

Make any required corrections, like proper YAML indentation, then save the file and restart Home Assistant.

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