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4 technology trends for the global hotel industry
June 25 2010

What global technology trends loom on the horizon? Savvy IT professionals surveyed the landscape during a panel discussion at HITEC.

ORLANDO—For a resource-strapped IT professional, it’s hard enough to stay on top of current technological needs in the hotel industry, let alone keep abreast of global trends on the horizon. But that didn’t stop a panel from trying during HITEC on Thursday.

Here are some of the top hospitality technology developments across the globe:

1. Budget reductions

Less of a trend than an unfortunate reality, budget reductions are making it more and more difficult for IT professionals to do their jobs.

For example, while working on a recent project in China, consultant Terence Ronson of Pertlink asked the owners of a new-build property what the IT budget was for the hotel. Their answer? There was no budget.

“They’ve forgotten to create a budget for IT, so you have to work with the leftovers,” he said.

That’s especially the case for IT infrastructure. An owner will spend a lot of money on a chandelier or carpet—those outward-facing elements that contribute to the “wow” factor for guests—but they overlook the critical cabling and networking elements that hide behind walls and in pipes.

In short, hotel companies are not IT companies, explained Jeremy Ward, senior VP of IT for Kempinski Hotels.

“A lot of hotel management companies are starting to understand that. … Our knowledge and skills are in hospitality management,” he said, adding that more and more companies have started to outsource IT.

The resulting forecast is bleak for hotel IT professionals, said Ted Horner, managing director of E Horner & Associates.

“We’ve got all this wonderful technology but there’s not even a custodian to watch over it,” he said.

2. Criminal targets

As recent terrorist and cybercriminal instances have shown, the global hotel industry increasingly has become a target for attacks.

In the Middle East, where a Hamas agent recently was murdered in a hotel by persons unknown, the region’s hotel industry has pushed for increased security standards with even more documentation of guests and more cameras to track their movements, according to Horner.

While working on a project in Abu Dhabi, for example, Scot Campbell of MGM Resorts International was asked to put in more than 10 times the amount of cameras than he usually installs—at casino hotels.

Cyber breaches also have pushed a few prominent hotel companies into the spotlight for public scrutiny.

In the United States, Payment Card Industry Data Standard Security compliance has emerged as a minimum benchmark to foster data security.

“You can almost see a sunrise across the globe. It’s completely been driven out of the U.S. originally. … It’s now starting to get into Europe, and there is a bit of drive there,” Ward said. “The acquiring banks in Europe don’t really know the strategy. They’re a bit worried about losing some of their customers if they come on too strongly with PCI. … Europe is kind of waking up to it a bit.”

But in the Middle East, Africa and China, “they have no care about PCI,” Ward added.

3. Guests want to be in control

BlackBerrys, iPhones, touch-screen kiosks and DVR—call them tools of the I-want-it-now masses. Consumers have more control of their lives than ever before, customizing their experiences to their own particular likes, preferences and needs.

It makes sense, then, that they want the hotel to be a natural extension, accommodating their insatiable need to be in control, Ronson said.

Terence Ronson, Pertlink

But just as those technologies enable a consumer’s ability to customize their experiences, so too does it become harder to build a hotel for the “typical guest,” he added.

“How do we know really what that guest wants and what is the typical requirement of that guest outside of (a clean, comfortable, affordable room) in the different geographic locations?” Ronson asked.

Addressing the need for guests to be in control is a challenging, ongoing problem, Horner said, especially given the proliferation of new technologies and devices.

It’s also a problem that might be exaggerated, Ward said.

“They may not want to be as in control as we perhaps think they are. It is a trend, but how deeply engrained is it at the moment? I don’t know,” he said, adding that it will come on stronger in five to 10 years.

4. Cloud computing

Having already addressed hoteliers’ growing desire to move certain IT functions off site, the panelists concurred that that doesn’t mean the industry is yet ready to embrace cloud computing with open arms.

Yes, the solution does save on labor. Yes, it does make it easier to save on large-scale capital expenditures. (If company invests in an expensive IT infrastructure on site, only to find it needs to be changed, it might have to wait 10 years before it has the capital to make the necessary changes. Software as a service, or a cloud solution, can be changed more easily for less money.)

Ted Horner, E Horner & Associates

And perhaps more than anything else, cloud computing allows companies to do more with less.

But at the same time, the “solution” brings with it some interesting challenges.

Within an on-site, private network, for example, connecting to different applications and systems within that network is a relatively straight-forward process. If each of those applications is outsourced—often to different vendors—connecting them becomes far more challenging, Ward explained.

The concept of moving data and processes offsite also raises questions about the services a management company provides. If a hotels’ every service is outsourced, then does the management company itself become a middleman, Horner asked.

And what if the owner decides to reflag? Does he or she lose that precious data in the cloud?

“I don’t’ think as an industry, as a management company, we’re quite ready to embrace the whole commercial aspect,” Ward said. “We have to start talking to our owners a little bit more now that we’re saving capital costs.”

Naseer Qureshi
2/2/2013 12:32:00 PM
Success of any business is heavily relay on the IT infrastructure, so the same as in Hotel Industry. Though, internationally known Management companies has adopted the corporate approach by centralizing the IT infrastructure; however, outsourching the IT modules for their ease, will not affect positively in the long run. It is imperative that management companies start investing on their own products, building their own database centers, their own control and their own management of centralization of IT Infrastructure.
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