Preparing For Telecom's Future

As IP telephony inches its way into the mainstream market, hotels find innovative ways to introduce this efficient technology without overspending.

By Rebecca Oliva, Technology Editor -- HOTELS Magazine, 9/1/2001

No one doubts the impact Internet Protocol (IP) telephony will have on the hotel industry. Internal communications, high-speed Internet access and long distance calls at a fraction of the cost of a traditional phone line are just some of the advantages IP promises.

Ideally, IP telephony covers a range of technologies, including voice-over-IP (VoIP) and fax-over-IP, both of which are carried over the same network, whether it be the Internet or private IP-based networks. This system can yield big cost savings because of the speed at which the information is traveling and because the phone calls avoid the tolls and tariffs usually charged using a conventional phone system.

While IP telephony is hardly a new phenomenon, it hasn't been widely accepted by the general public for many reasons, such as low quality of service and security; however, it promises to become the next big thing in telecommunications. What this means for hoteliers is there is a potential for huge costs savings that can be extended to guests. It also lends itself well to the hotel's back-office operations by allowing the company to integrate e-mail, fax, pagers and voice mail and letting business travelers receive multiple message types through one connection.

Still, even as IP telephony promises big cost savings, a low quality of service and a large capital investment constitute big reasons for the low adoption rate of such systems by hotels. There are, however, ways in which hotels can begin to prepare for the convergence of traditional telephone systems to IP telephony. Digital devices such as video libraries can be installed in guestrooms, and new systems that are IP-ready can take hotels into the next generation of telecommunications.

Many telecommunications companies have been preparing for such adoption. Mitel, Nortel Networks, 3Com, Cisco Systems, NEC and Siemens among others, have been introducing new systems that are ready for VoIP or help to better prepare a hotel for the days to come.

"IP telephony will reduce costs in the long term, but it's going to take a few years to get there," says Bob Stoutenburgh, president of Future Technologies Consulting Group, Marietta, Georgia. "Right now, companies are testing VoIP internally to see how it works and how to get control."

Stoutenburgh believes that it will take a couple of years until full integration of voice, data and video will become standard in guestrooms, but he says the cost savings for hotels will be quite large as one network can carry both voice and data.

Starting Out

Already preparing for the convergence process, Hotel Crescent Court, Dallas, Texas, is deploying a US$270,000 platform by NEC America. The new NEAX(r) 2400 Internet Protocol eXchange (IPX) telecommunications platform is designed for businesses that are seeking to deploy IP telephony but aren't quite ready yet. The new system was developed to offer companies a simple and clear path to migrating toward IP telephony while supporting traditional telephony, as well.

Marriott's Event Technologies

Responding to a growing number of highly technical business meetings, Marriott International, Washington, D.C., recently launched EventCom Technologies, a service that provides communications and event management assistance for high-tech meetings.

The service will include satellite broadcasting, ISDN video-conferencing, Web streaming, collaborative Web conferencing, audio conferencing and site selection, and related management services.

"More and more clients were coming to us and saying, 'we want interactivity at our meetings,'" says Tom Maguire, director of EventCom.

EventCom serves as a single contact for event planners. The program takes all the information from the client, then responding by finding availability for multiple-site meetings at any Marriott location. It then works with them on connectivity. Maguire says the client is not limited to one type of technology. Instead, five technologies are offered.

"We act as a central meeting planner for all the hotels," Maguire says. "It's a single contract, single contact, and one invoice is handed to the client."

EventCom Technologies also provides technical and communications support and offers centralized billing.

In addition, EventCom provides total management capabilities that can research and compare locations and costs, banquet planning, food and beverage services and coordinate audio-visual services.

Since Marriott started advertising the program in April, EventCom has been popular with companies all over the world. Cost of the service depends on the amount of technology used, with the lowest starting at Web streaming up to satellite video-conferencing.

"We were caught in a bind with our old equipment, and we wanted to upgrade to a system that would guarantee us moving forward," says Elias Assaly, managing director, Hotel Crescent Court. "The new switch will allow us in the future to do some fun things."

Although Assaly sees no plans in the near future to convert guestrooms from existing analog phones to IP-enabled phones, he believes the new system will set them up to be competitive among business travelers. "We want to be able to get to the point where the hotel telephone is seamless with a guest's cell phone," Assaly says. "This system just positions us for future investments."

The Crescent Court's technology consultant agrees that VoIP is the wave of the future, just not yet. "The reason for the lack of use of IP is that the quality of service is not acceptable yet for a property," says Don O'Neal, Principal, O'Neal/Gaj International, Dallas, Texas. "The hotel would get too many complaints."

O'Neal says the Hotel Crescent Court is on the leading edge by putting in a platform that will support IP. "They have bought for the future," he says. "The don't have to make another purchase."

Providing The Foundation

Hotel rooms may not be ready for integration of voice and visuals and data over one network, but one IP solution that may be a starting point is in-room entertainment. Many hotels are looking into digital broadband television that offers in-room videos on demand. The Peninsula Beverly Hills, California, recently installed NXTV's digital video on demand for its guestrooms. The NXTV Broadband Delivery System is a digital IP-based system that is delivered over either the existing telephone cable or the Ethernet cable.

With the installation, each room has high-speed broadband Internet access, available through the TV or guests' laptop computers, and access to the hotel's digital videotape library. Hotel guests are able to choose from interactive broadband services including digital video-on-demand movies with enhanced TV features such as pause, reverse, fast-forward and bookmark.

Hotel And Travel Index Online

Hotel & Travel Index, a hotel directory for travel professionals, re-launched its Web site September 1 at www.htihotelink.com. The new site, designed exclusively for the travel professional, will have detailed information on more than 75,000 hotels worldwide.

"The bottom line is that there is really nothing available online for travel professionals that is all inclusive," says Steve Bailey, publisher, Hotel and Travel Index. "The only option now is to go to individual Web sites."

New features include property photos, restaurant listings, currency conversion, weather, contact information, and in-depth information on meeting facilities and all the hotel provides for leisure travelers. In addition to hotel information, the site provides 600 airport diagrams worldwide, state department advisories and city reports on 100 cities.

Hoteliers will be able to search by geography, amenities, hotel type and distance from a specific address, Bailey says.

The site is available to all travel professionals. Upon registration at the site, site users can print city reports and airport diagrams and receive optional weekly e-mails updating them on specials and booking incentives.

However, what's unique about this system is that it allows guests to get a connection through their IP-enabled telephone, although The Peninsula's Executive Assistant Manager Ellis O'Connor believes few guests actually use the access for that feature.

"We are giving a greater choice of movies and greater functionality, which makes us a market leader," says O'Connor. "Offering our guests a high speed series as a whole package allows us to create an infrastructure that would carry us into the next thing."

High-speed Internet access was installed at the Peninsula in February, and just recently, the digital video option was rolled out. O'Connor says so far, there is a 25% buy rate of videos. Guests can use the service for US$10.95 for one 24-hour period. By offering such high-speed broadband services, in both the guest rooms and meeting spaces, The Peninsula is equipped to handle almost any function that requires a great deal of high-end technology.

What's Ahead

O'Connor agrees that VoIP won't become the standard in guestrooms for awhile, but he believes the first stages have begun. "I think that in next 12 to 24 months we will see more integration," O'Connor says. "At the moment the technology companies are fighting for market share, and that will dictate voice and data convergence."

"Certainly by virtue of the cell phone explosion, telephone revenues are declining," O'Connor says. If there is an opportunity for the hotel and it's a service guests will want we will look into it, he says.

At the moment, IP telephone access is possible through the fiber optic cables that connect the Internet and digital video system. If guests have an IP phone, they can plug their phone into the high-speed Internet access to get into their Virtual Private Network (VPN) at work, O'Connor says. "If you are here on business, you don't have to go through the PBX exchange."

On the entertainment side, the hotel has 35 new release films available to guests at any time. They also offers wireless keyboard for use with the Internet via the television screen. "Our guests tend to expect from us something better than they have from home," O'Connor says.

Even though O'Connor's interest in voice and data convergence is limited, he predicts implementing a totally digital system. "We still want to have the system tried and tested at this period and time," O'Connor says. "We'd like to get games on demand and personalized e-mail addresses for guests. Having this digital infrastructure creates the platform for us. IP telephony is something that we will definitely look into, should it become financially viable."