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Perspectives: The Future of HSIA

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October 01, 2012
Dan Phillips - dphillips@dare2i.com

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Be careful when you assume.

Recently, I made an assumption on the future of HSIA and then floated it by several hoteliers and solution providers for comment. 


The assumption: Currently, the guest demand for bandwidth in hotels is increasing rapidly.  Guests are using the Internet more and more, and they are bringing more and more devices that need to connect.  Hotels are striving to increase the amount of bandwidth accessible to their guests.  However, over the next several years, the trend could turn to where all of the devices guests own will come with contracts to their own service providers over 4G or other protocols. It could happen, a few years from now, as hotels finally catch up and provide enough bandwidth to meet guest demands, that guests actually leave the hotel-provided access to connect to their own device service plan providers. This could result in hotels having significant amounts of excess bandwidth.

I tapped a few industry experts to keep me from being the proverbial dingaling.  My friends include:

  • John Flack, vice president, Core Technical Services, Hilton Worldwide
  • Gustaaf Schrils, vice president, Global Technology, IHG
  • Ron Strecker, CFO, Al J Schneider Company
  • Cynthia Carpenter, vice president, Customer Solutions, iBAHN
  • Stephen Hovanetz, national account manager, Windstream
  • Todd Shobert, COO, Safety Net Access
  • Mike Wagoner, vice president of engineering, CLC Networks

Hoteliers are adding more and more bandwidth, even looking toward burstable solutions. Companies are using load balancing equipment and leveraging circuits from multiple providers in their hotels.  All of them are experiencing a substantial increase in the number of devices per guest that need to connect.  IHG's Schrils said, “Bandwidth consumption is growing exponentially and now the issue is multiple devices.  Our extended-stay hotels now experience an average of 2.2 devices per occupied room.”

In regards to tiered pricing, Hilton's Flack said, “We are constantly looking at our pricing, among all other components of the product. Tiered pricing can be a valuable option, and we do use it in certain hotels today. However, tiered pricing can drive greater bandwidth demands as more guests will use the Internet if it’s free.  Hotels must deliver on the experience promised to guests, whether this is a free or paid product.”

When asked if it more important for a hotel to provide high quality HSIA or to enable guests to have access to their own providers, Schneider Company's Strecker  said, “I think both are important but at this moment I don’t feel as though the hotel should take the responsibility for guests getting a strong signal from their particular cellular provider. If a cell company would like to invest (its) capital in our hotels to improve (its)network reception then I would respond, ‘Why not?’  HSIA, however is something we can control and has become a much higher expectation of the guest than it is to get four bars on (his or her) phone.” 

A distributed antenna system (DAS) is a method by which cellular providers can enhance signal strength inside of buildings. DAS is typically expensive, and a general rule for pricing could be $1 per square foot of coverage.  Also, since cellular towers are typically high up off the ground, in an urban setting taller hotels may find poor signal strength in the upper floors, say floor 15 and higher.  Hilton has implemented DAS in hotels with cellular signal challenges, while the Schneider Company decided against it when presented with the true costs of implementing this solution.

All of the solution providers offer a variety of methods for hoteliers to address the increasing demands of their guests HSIA.  For example, Safety Net Access provides a load balancer that allows hotels to use multiple circuits. "This allows hotels to take advantage of some more cost effective circuits and pay less on a monthly basis, rather than a higher monthly price for solutions like fiber circuits,” said Shobert.  In CLC Networks' case, the company offers hotels the ability to bond and load balance across multiple types of circuits. Wagoner said, "These include traditional T-1, MetroE, WiMax, cable and DSL.  This solution also provides the hotel with fault tolerance.”

When asked how long will it take 4G networks to take a majority of guest in-house traffic, all of the participating solution providers pretty much said never.   “I believe there will always be a need for a mix of wireless and wired connections in a hotel to ensure the guest will have 100 percent connectivity at all times," said Hovanetz. "With guests carrying more wireless devices it is doubtful that 4G will take over the hotel’s wireless configuration.” Carpenter added that the 4G networks are overloaded and said,   “Carriers are looking to push as much of that traffic to Wi-Fi networks as possible.  AT&T keeps buying small Wi-Fi network companies to augment (its)Wi-Fi services and then offload 3/4G traffic to those networks.  I don’t see a change in that strategy any time in the near future.  In fact, it seems to be ramping up.” 

With new protocols, the technology is changing every day. “The new 802.11U protocol will incorporate the cellular protocols and the HSIA providers will have the ability to handle the cellular voice traffic as well as the data traffic," Shobert said. "This technology is already built into new smartphones.”

None of the solution providers participating are in favor of DAS making much penetration into the hotel market.  “With the proliferation of smart devices capable of utilizing the cellular networks, DAS will become a requirement only in areas where coverage is low, such as the upper floors of high-rise properties, the basements and back offices of hotels, and areas containing dense construction," Wagoner said. "This will not only be required for guests, but for hotel staff as well.”

My orginal assumption of the hotels catching up with guests' bandwidth needs was not generally accepted by either the hoteliers or suppliers.  “Security systems, door locks, environmental controls, VoIP services and many other applications within the hotels can be used on a Wi-Fi network," Shobert said.  "Non-guest services, such as cloud based PMS and POS, will continue to need more and more bandwidth. Building Wi-Fi networks with the ability to handle cellular traffic and create handoffs to all of the major carriers will eliminate the need for DAS. We will continue to offer more services over the local Wi-Fi network than can be offered over a traditional 4G network.”

Very simply put, Hovanetz said, “It is doubtful that there will ever be excess bandwidth in a hotel environment.” Back to the drawing board.

Dan Phillips is a partner at Dare to Imagine and can be reached at dphillips@dare2i.com.

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