Marriott Offers Fast Log-On

<B> Marriott Offers Fast Log-On</B>

By Bob Curley

Marriott International last week became the latest hotelier to announce plans to provide guests with in-room, high-speed Internet access, providing further evidence that the service eventually could become standard among hotels catering to the business traveler. Marriott said its deal with Utah-based Suite Technology Systems Network will provide Internet access at speeds up to 50 times greater than the conventional dataports that have become commonplace in hotel rooms in recent years. Marriott will charge guests $9.95 per day for unlimited Internet access; plans call for the STSN system to be installed in 100 Marriott properties by the end of 1999, and in 500-plus hotels by the end of 2000.

Laptop users will be able to connect to the network through a small box that sits next to the telephone and includes Ethernet, USB and standard phone-line dataports.

High-speed online access is a priority item on many guests' wish lists, according to Dan Banchiu, senior vice president of rooms operations for Marriott. The chain's customer surveys show that 75 percent of Marriott business guests bring their laptops with them; of these, half want to use the Internet while they stay, Banchiu said.

Those findings are consistent with the observations of Valyn Erickson, a senior associate with PricewaterhouseCoopers' hospitality and leisure information technology practice, who said that customer demand clearly is driving the move to high-speed access. "Suddenly, business travelers are making noise about it," said Erickson. "It's really irritating to wait to get your e-mail at a 9600 baud rate when you're used to high-speed access," she added. "They're saying, 'If we can have this at work, or at home, why can't we do it on the road?' " said Erickson.

Wingate Inns, a new hotel chain catering to the business travel market, in August announced that all of its 60-plus existing hotels now are offering high-speed access provided by LodgeNet, which recently added Internet services to its array of TV-based offerings, which also include video-on-demand, video games, and interactive guest services. In addition to in-room access, both Marriott and Wingate will provide high-speed service in their meeting and board rooms.

Unlike Marriott, however, Wingate plans to offer the service free to guests. But experts said that business travelers typically can expect to pay $10 to $15 per day for fast Internet access. Marriott's Banchiu said that research shows customers are comfortable with such pricing, and that the hotel believes a per diem charge is preferable to incorporating into the room rate the cost of a service only some guests will use.

Brian Reed, manager of research and development at Bass Hotels, recently said competition would force prices down, and that eventually hotels would probably have to offer access for free.

Wingate president and CEO John Paul Nichols said the installation of high-speed Internet access "provides our franchisees with a competitive advantage over other hotels."

But industry analyst Erickson believes this thinking may have a short shelf life. "Six months ago, offering high-speed access might have been seen as a competitive advantage for hotels," she said. But, Erickson added, "It's going to become a standard, just like two-line phones or an extra phone in the bathroom."

Scott Petersen, president and CEO of LodgeNet, predicted that within two to three years hotels that want to serve the business travel market will be compelled to offer high-speed access.

Also driving the trend is the recent explosion in the number of vendors offering high-speed access services to the hospitality industry, said Erickson. Currently, there are about 40 companies selling Internet access to hotels, compared with a mere handful just a year ago, she said. Most of those vendors were on hand during the recent HITEC show.

The industry, according to LodgeNet's Petersen, has been flooded with start-up firms looking to secure big contracts to provide services. Erickson called the vendor field a "horse race" that should filter out to 10 or fewer companies over the next year or so.

Those that survive will find plenty of potential markets for their services. Wingate, Marriott and management companies such as John Q. Hammond Hotels Inc.--which in June announced a deal with vendor CAIS Internet to provide high-speed access at 48 of its 49 Embassy Suites, Radisson, Crowne Plaza and Marriott properties--are still the exception in an industry where few hotel chains have made broad commitments to fast in-room Internet services.

Sheraton, for example, is "a smidge behind" the trend, according to spokesperson Deborah Bernstein. Only a few hotels in the chain, such as the new Sheraton Rittenhouse Square in Philadelphia (BTN, Sept. 6), offer high-speed access.

Internationally, London's four-star Millennium Britannia Mayfair hotel recently became the first hotel in the United Kingdom to offer guests Internet access via a dedicated Fast Ethernet Local Area Network. Using the network, guests staying in the hotel's Club Rooms and those using its meeting rooms and business center can create their own virtual private network to link electronically with each other and the home office. (As an added enticement, the hotel also offers guests free use of a cell phone for up to two weeks.)

High-speed is sometimes defined broadly. In the Philippines, for example, the Makati Shangri-La--which caters to North American business travelers--recently installed a dedicated line that allows guests to access the Internet "at the full speed of their modems." In this market, however, that's a big improvement over dealing with local Internet service providers, which often are beset by busy signals, failed connections, and interrupted sessions. The hotel also has created an Internet portal that provides guests with news, stock quotes, weather, sports and local tourist information.

The Millennium Britannia Mayfair boasts Internet access speeds 3,400 times greater than with a standard connection, while other hotels make more modest claims of access up to 50 times faster than with a 28k or 56k modem. Experts like LodgeNet's Petersen, however, believe that guests likely will be satisfied with any solution that provides them a boost over standard modem speeds, and probably won't pick and choose between hotels based on the relative speed of the connection.

The solutions being offered to hotels also vary. A T-1 or T-2 line typically provides the pipeline from the Internet to the hotel, but Oregon-based WinCorp is marketing Digital Subscriber Line access to hotels, promising speeds from 20 to 400 times greater than dial-up modem connections.

Internal infrastructure plays a big role in how individual guests access the network. The STSN system used by Marriott, for example, uses existing phone lines, so no new wires or cables were required. At the same time, however, the system takes the burden off of Marriott's existing PBX phone systems, which was being overloaded by guests using their laptop modems to access the Internet.

Wingate, on the other hand, had the luxury of installing Ethernet infrastructure as it built its new hotels from the ground up.Wingate's solution provider, LodgeNet, which uses the television as the medium for Internet access, is tinkering with a number of different approaches to providing its Online service. For instance, the company is experimenting with cable modems in addition to Ethernet and DSL.

LodgeNet may emerge as one of the leaders in providing high-speed access because of its established industry ties: more than 4,700 hotels currently subscribe to the company's in-room movie and game services. LodgeNet also is offering a WebTV-like interface to hotel guests, meaning that even non-laptop users can surf the Internet via the television and download e-mail from Web-based portals such as Hotmail or Yahoo.

That could give Online by LodgeNet a broader consumer appeal than other solutions, but even CEO Petersen acknowledged that, for now, it is still the business traveler who will dictate which high-speed options hotels will offer.