This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies.  Find out more here  Close
Juggling connectivity cost and consumer demand
March 26 2012

With guests carrying more devices, providing adequate bandwidth is key. Sources said guests are more willing to pay for a service that works than one that leaves them lagging.

Highlights
  • From laptops to smartphones to tablets, guests are now looking to connect all these devices simultaneously to a hotel’s network, preferably for free, potentially draining greater bandwidth than ever before.
  • Whether a hotel opts to charge for broadband, owners can expect to sink dollars into infrastructure, one way or another.
  • Greater value, and hopefully fewer headaches, can also be gained by relying on a provider who bundles wired/Wi-Fi connectivity with other services such as TV, video, gaming, etc., because the platforms all utilize the same infrastructure.
By Brendan Manley
HNN contributor

GLOBAL REPORT—There was a time when hotels were providing guests with an in-room technology experience that often far surpassed the breadth of what guests could enjoy at their home, whether it was broadband connectivity, video games, or streaming movies on demand.

Now, many guests arrive at a hotel after leaving homes equipped with some serious bandwidth, plus countless channels and unlimited streaming movies. On the road, these travelers come armed with an array of mobile devices only increasing in number and sophistication. They expect the hotel’s network to be fast, and preferably free. And if guests don’t get what they want, they will certainly make their displeasure known.

“Universally, I can look at my guest satisfaction scores, and I can say that people generally are going to comment about three things overall: They don’t like paying for Internet, the speed is too slow, or they have difficulty connecting,” said John Czarnecki, IT program director for Hyatt Hotels Corporation.

“If you want to really, really hack off the guest—and I mean seriously, where they hit Twitter and slag off your hotel—give him a room with no Wi-Fi,” said Derek Wood, a Bristol, United Kingdom-based consultant and member of Hospitality Financial and Technology Professionals’ global board. “If it’s too slow, it goes off, or it drops, the guest will remember that longer than he’ll remember if his coffee was cold or his BLT didn’t have chips with it when it arrived.”

Free, or funded?
From laptops to smartphones to tablets, guests are now looking to connect all these devices simultaneously to a hotel’s network, preferably for free, potentially draining greater bandwidth than ever before. Accommodating such usage is a growing concern for hoteliers, who must juggle the cost of installing, maintaining and possibly upgrading the needed infrastructure, yet often remain on the fence about whether to charge for the service. Although it’s tough to track the changes in usage, the burgeoning consensus is some kind of fee needs to be in place to help offset the climbing costs.

“Delivering it for free is going to be difficult. And at the lower end, it’s even more difficult to absorb those costs; when you’re talking about thousands of dollars to provide bandwidth, that’s an awful lot of money to absorb,” said Bryan Steele, managing director of IT consultancy Jireh-Tek Limited. “It’s one thing having a basic service for free, but it’s important to have a service that works at a reasonable cost. It’s better not to give it away free than to have it not working.”

Some hotels are experimenting with a per-device connection charge, but sources said anecdotally guests are frequently none too happy to learn about the pricing. Another solution gaining momentum is tiered billing, which essentially offers several classes of fees, based on usage levels.

“Make sure your provider has tiered bandwidth options. If he doesn’t, don’t go there,” Wood said. “That is the latest step in the software technology area, combating the fact that everybody’s usage is going up in those hotels which are sensible enough to charge for it.”

It’s doesn’t make it any easier that guests now arrive with major expectations because the digital comforts of home are often greater and costlier these days than what hotels can conceivably provide. “I have Comcast at home, and a really fast 15- or 20-meg download speed. Try to scale that to a building that has 1,000 rooms. There’s no way to do it,” Czarnecki said. “There’s not a chance you could put that much bandwidth in a building economically without charging for it.”

Building the backbone
Whether a hotel opts to charge for broadband, owners can expect to sink dollars into infrastructure anyway. Depending on the size of the hotel, numerous wireless access points must be installed on each floor in order to ensure all guestrooms receive service. In the past, the hardware requirements were more simplistic; nowadays, more access points are often needed, especially because the newest breed of Apple devices are notorious for having weaker antennae.

“In any one corridor, pre-smartphone/iPad, you could get away with one access point, depending on how thick the walls were. One access point would typically service four or five bedrooms,” Wood said.

Tablets, Wood said, pick up their signal in a much smaller radius than a laptop. “What we’re finding is that hotels that got wired as little as three years ago are now having to get their Wi-Fi people back in to increase the density,” he said.

Even more critical for the building’s backbone is the actual data pipe coming into the basement—pinch pennies there and there’s only so much the rest of your network can do. Today, IT professionals are urging owners and developers to invest in the best fiber-optic connectivity possible, then configure the rest of the data architecture from there.

“Some operators have resisted the inevitable and are not getting over the sticker shock of bringing in fiber to a hotel the first time. But I think everybody’s pretty much past it,” Czarnecki said. “For most of the developers building hotels now, there’s not much of a discussion about whether we’re going to bring in T1s or fiber; we’re going to do fiber because it’s got the capacity.”

Getting help
Greater value, and hopefully fewer headaches, can also be gained by relying on a provider who bundles wired/Wi-Fi connectivity with other services such as TV, video, gaming, etc. because the platforms can all utilize the same infrastructure. And when something goes wrong, the vendor is the party responsible for support calls. A vendor can also be helpful in overcoming a hotelier’s learning curve for understanding the hardware needed; leaving it to an in-house purchasing decision can result in all kinds of gaffes.

“It’s a pretty complex area, once you start to look at the hardware involved, and the network protocols that have to be supported,” Steele said. “Having flat-screen TVs appearing in hotels is a very interesting example where there wasn’t a good understanding of the technology. Lots of hotels went and bought these new TVs, but they had analog systems in their basements, so they basically started to send video that was formatted 4:3 to a 16:9 set, and everybody ended up short and grainy. There needs to be a realization among operators that bandwidth is technically quite complicated now.”

In the case of branded properties, chain-wide standards are often put in place for systems and vendors, leaving owners with little choice, while independent operators are typically left to make such crucial decisions alone. Other factors for choosing a provider include location, particularly for properties outside the United States, where only one or two appropriate vendors might service an entire region or country. Costs for essentials such as the main fiber-optic pipe often climb still further when installed outside metro areas.

“Internationally, it varies a lot, between rural and city. If you go into a metro area, you might be able to get fiber circuits—it’s still a lot of money, but if you compare that to going out of metro areas, your costs can be several times that,” Steele said. “The availability of technology is still dependent on your geography within a country. There are regions where bandwidths are extraordinary compared to others; the Middle East is known for being expensive, and a lot of Asia is challenging to get cost-effective bandwidth. It varies across the world, country to country and city to city.”

For now, experts say all hoteliers can do is provide the most bandwidth possible in their properties because it’s a near certainty guests will use it. That may involve charging a nominal fee per guest to offset the rising costs of hardware upgrades, but in the long run guests are still more willing to pay for a service that works than one that leaves them lagging.

“In the larger hotels and the 4-plus stars, I think they should definitely pay for it because the sweeping generalization is where the service is free, the service is crap. There is no incentive from the hotelier to provide a decent service because he’s getting absolutely nothing in return,” Wood said. “If you just wrap it up and give it away for free, I believe you’ll always be behind the curve.”

COMMENTS   Show All
Login or enter a name   Post Your Comment  Check to follow this thread via email alerts (must be logged in)
(4000 characters max)

Comments that include links or URLs will be removed to avoid instances of spam. Also, comments that include profanity, lewdness, personal attacks, solicitations or advertising, or other similarly inappropriate or offensive comments or material will be removed from the site. You are fully responsible for the content you post. The opinions expressed in comments do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Please report any violations to our editorial staff

TRENDING
Tiered Wi-Fi emerges as new industry model
Heartbleed a ‘significant’ threat to hotels
How to mitigate dependence on OTAs
Omni Nashville GM hits hotel jackpot
The role of today’s management company
A ho(s)tel path: Meininger builds rare model
VIDEO
Hunter Hotel Conference postgame wrap
Bazin outlines Accor investment strategy
Accor's Bazin talks growth
Sébastien Bazin's view from the top
Chris Nassetta talks lifestyle brand
LATEST NEWS
US hotel management contracts list
Global chains gain steam in lifestyle space
Cracks forming in loan underwriting?
Capital recycling fuels Hyatt’s growth
US hotel transactions list
Hotel Equities’ Cerrone takes several paths
Contact Us
Hotel News Now
18500 Lake Rd.
Suite 310
Rocky River, Ohio 44116
        
Copyright © 2004 - 2014 Hotel News Now, a division of STR, Inc. All Rights Reserved.   Privacy