The (Best) Case For Free Hotel WiFi

Operators need to take seriously the reliability of the internet service for guests. My business partner and I have removed several hotels from the places we use due to unreliable internet service. A business traveler expects working internet service as much as hot water, cable, heat and air. Telephone service is not so critical now with cel phones but it seems the hotel operators do not take internet service seriously. We have changed hotels in several locations due to that neglect.

Hotel operators who can understand marketing will come along - the rest will not - because they know little about their client. I also wish hotels would use fair/good quality radios. Clock radios from 1980 are worthless. If theft is concern, nail 'em down. But give us break - not everyone want Jay Leno.

The most common setup across our 700+ hotel HSIA systems is: -Free Basic Service in Guest Rooms -For-Pay Speed Upgrade service available in Guest Rooms -For-pay service available in public areas for non-guests -For-pay service in Meeting Rooms And although I like the spirit behind your article, Adam, you should know that the cost of sourcing *good* wifi is far from low. Sure, hotels can implement systems from operators running out of their garage using consumer grade equipment to keep costs low, but I think we can agree that offering free wifi that only works half the time is more detrimental than not offering it at all. Operating a reliable guest network that a) maximizes the almost-always-insufficient bandwidth pipe feeding it, b) blocks abusers, c) protects guest computers from one another, d) is self-healing, and e) is flexible enough for future needs is challenging and only meant for professionals. Your article seems to suggest otherwise and I take issue with that point. Other than that, this is a good article and hopefully one that hoteliers take to heart. Thanks

The amount of discussion that this has created in such a short time shows the level of public feeling. From a personal point, I travel extensively and am more dependant on my laptop now than ever before. City Center hotels offer much the same facilities and my main requirement when booking my stay is that they provide free Wi-Fi. I have been caught out in the past and actually paid more for the internet connection than I did for the room. I can understand why hotels charge for the service however it is the same as why Turkeys wouldn't vote for Christmas. Hotels are losing customers by not providing a free service but that is their prerogative, as its mine to go elsewhere.

Keith, it all has to do with the infrastructure. Look at the size of the hotels, # stories, construction methods, etc. It costs a lot more to provide coverage in a 600 room hotel than a hostel or coffee shop. Then there is the circuit, as mentioned. It has to be much bigger for the demand size or it becomes a guest tick-me-off if it's slow. Then there is 24/7 monitoring (hotel's always open) and customer support for those who can't configure their devices independently. Add all this up and multiply by say 30? for a larger hotel vs. a hostel, B&B, inn or motel. Your idea is on the mark, provide some free access in key locations, perhaps where other revenue can be captured (coffee shop/lobby lounge), perhaps free basic connectivity in guest rooms for normal email/browser traffic, and block the serious bandwidth hogs/downloads, etc. except for those willing to pay for the additional service.

I agree with you 100%, Hotel Consultant24.

Interesting points…I can agree with some but not others. Hotels do have to make a significant investment in infrastructure and bandwidth to offer guests a quality experience. They also pay for 24/7 support that you don’t get at home when you set up a wireless router. Something else not addressed is the bandwidth consumed by applications like Slingbox and Skype and by downloading movies and iTunes. By “allowing” guests to do such things and not increase bandwidth often means a poor guest experience – that can translate to lost business if not properly addressed. Again, driving up the cost of providing the service. I believe a tiered solution – offering “free” for guest doing basic email and web surfing and then charging for those that want more bandwidth (or an upgrade in service) is most appropriate.

A suggestion is to provide free WiFi in a lounge or café area (like Starbucks does) of the hotel where guests can have a cup of coffee/drink/snack while they check their emails/etc.. I'm sure that's feasible!

I've seen many arguments from (I'm guessing hoteliers) about how much it costs to provide a WiFi service. I don't get it. How come it costs them so much to provide this service while hostels and 1-3* hotels can provide it for free? Do the latter have deeper pockets? Or am I missing something here?

Very good point Nick.. instead of it being some powerful dialectical tension, we could be moderate and say "works for some, not for others". We have a tendency to look at things as an "either/or" manner, don't we. I did just check, and wifi is basically a concession with groups. Like, "come here, and we will throw it in". I would *LOVE* to hear what hotels are charging groups for wifi at this point. Seriously.... love it. If there is one on the strip, or in a major city, that is still doing it at this point I would like to pat them on the back for a job well done. Also... I think attacking a reporter is ad hominem, eh? Kirby makes no massive claims to being a hotelier. He's a reporter for the hotel industry. When you don't like the reporting, attack the story and not the human. It's common sense. What else is common sense is just being nice, but that takes a lot of effort for some people.

8 years ago, WiFi was hardly in our vocabulary, let alone standard in new construction. 8 years from now, we'll probably all have global unlimited internet access, or something close to it. In the meantime, it makes more sense for some hotels to offer free WiFi than others. However, at the very least I can see how this could be used powerfully as part of a "preferred guest" program, or as an incentive for joining some kind of "preferred guest" club. You'd be foolish not to leverage a free WiFi incentive for at least something. Nick/HospLeader

(cont)...... you can save on in pre-opening.... but it is interesting that we still attempt to put it in place, and then resultingly just give out free codes because we haven't been able to leverage it as a revenue generating service because people are finally at the level they expect it. I think the market will answer this question for us in time, and Adam has been ahead of the curve on this. But if you have ever installed new wifi, or worse retrofitted a horrible concrete building with it... that cost coupled with the maintenance and service of it (even a couple years ago... but it *is* getting better) was significant enough to be passed onto the guests. And please tell the editor to allow links. Don't care about the hotel page, but that twitpic I linked is insanely hilarious.

wow this generated some feedback, eh? I think the problem is that once you have a revenue stream, it's hard to let it go. We did that with phones... that whole debacle from the birth of calling cards to cell phones destroyed that stream, and we are always desperate to maintain the ones we have. It is a HUGE revenue stream in group resorts and hotels. Like this property (www.twitpic.com/6dmx5) with $450 for 10 hours. Groups pay it.... but I am not sure for how long. Like I mentioned, the AIG effect rippled through our industry, and now people are really looking at line item charges and questioning them where they used to pay whatever the final bill was. The other inconsistency is that low tier to mid tier hotels give it away, while high end properties know people will pay it, so we still charge for it. The real question is this: embed it into the rate, charge a resort fee, take it as an operational cost, or keep charging for it? In my experience, which is a good amount, people rather pay for a service they choose to use (spa/wifi) rather than pay for services they don't use (spa/fitness room/free wifi/etc). There is a lot of confusion and push back on resort/hotel gst service fees. So the final question might be embed it into the rate, take it as a loss/cost of operations, or charge for it. You know us hoteliers... we don't take losses. So we embed or charge. What's the answer? I have opened two high end, luxury eco-resorts in the last year - Cavallo Point in Sausalito www.cavallopoint.com and The Allison in Oregon www.theallison.com The market bears the answer.... we set up to charge at Cavallo, and we just can't get away with it. I don't think the infrastructure was ever put in place to charge at the Allison. I do know it cost about $15K or so in our pre-opening budget (that is a rough estimate) just too set up so we could have 11 wireless bill... so that is a (relatively low) front end cost

"The percentage of guests that use HSIA is less than 25% in business oriented hotels and only a fraction of that in resorts leisure destinations. Why should ALL the guests be charged for something that only a fraction use?" I'm curious as to where you got those numbers. I can see that being true for hotels that do charge, but seems doubtful for those that offer complimentary service. With so many devices being Wi-Fi capable these days from phones to MP3 players, and laptop computers being almost ubiquitous, there's no way that that information is current or accurate. I believe Adam's point was that many hotels constantly offer so many other things for "free" such as breakfast, a newspaper, cable television, etc... who's paying for that stuff and how? It obviously isn't free either, is it? Everything costs something, whether it's heat, a clean bed... whatever. It's how you choose to present it. The reality is, many people do actually look and choose to stay at hotels that provide complimentary Wi-Fi, and many hotels are able to do that and do it well. If you continue to deny that, then keep turning those potential customers away people. You'll only continue to lose business in the future and that will likely increase as that segment grows. Maybe you just need to look into some new providers.

Adam, There's a lot of factual problems with your article. I can see two things very clearly. First: You don't own a full service hotel. Second, You have no background in technology. In addition to that, you don't have an understanding of the customers in full service hotels. What percentage of Marriott, Westin and Hilton customers do you think are using Twitter for example? Is that really the basis for your opinion? Absurd! I wish I could stop there but I have to point out that the comparison you make between WiFi and HVAC is ridiculous. The percentage of guests that use HSIA is less than 25% in business oriented hotels and only a fraction of that in resorts leisure destinations. Why should ALL the guests be charged for something that only a fraction use? Last point because I have to get busy on actually operating hotels. You have no idea what it costs to provide WiFi correctly in a full service hotel. Do you know what a DS3 costs on average? Do you know what it costs to install, maintain and periodically upgrade the equipment? ... to provide 24/7 tech support? If it was free, how good would the service be? I'll give you the answer to the last question: Not Very. Seriously, get off it. I'm embarrassed for you. Who is your audience in Hotels magazine? Hotel Owners and Operators or frequent guests of mid-market hotels that use Twitter?

So it's still good to provide free wifi (slow just for basic surfing and emails) and dedicated internet at a charge. but make sure it is dedicated and fast enough.

You are absolutely correct. Besides, hotels charge damn a lot for Wifi. USD12 per 2 hours. It's daylight robbery. Toiletries are provided for free, why not Wifi?

As someone who has worked in the industry for over 15 years, I get the premise of why people find it ridiculous that many hotels charge for WiFi. However, these people aren't behind the scenes. To back up "tips" comments above, it's true that there are significant costs to put in the wireless access points throughout the property. Just the covers alone, to hide the unsightly WAP's from the guests eyes, can range between $30 - $45 each. If one has a 1,200 room hotel with 15 floors and over 30,000 square feet of meeting space -- that expense alone can be fairly hefty. Additionally, to the comment of "You probably have WiFi in your hotel anyway to allow staff to do their jobs. So the marginal cost of allowing your guests to use it is close to zero."...this is not true at all in many cases. Depending on the hotel, the Brand, the market, the internet provider...there are costs involved. Some hotels are, and have been, locked into multi-year contracts. These contracts require them to pay a percentage on each user above the flat monthly fee. The percentage they have to pay increases in some instances when it's in public/meeting space versus the actual guest room. Think of it like your DVR and receiver boxes for cable or satellite. The provider lets you have the first two rooms for free, but then charge for additional rooms/receivers. Or software licenses, usually you get a set number, but once you go over that number you have to pay for each additional user. WiFi portals are similar. Businesses get a certain number/sq footage, but anything over that limit that might drain on the overall output costs extra. There is, however, an easy fix for many travelers. Whatever Brand they are loyal to and tend to use the most when traveling, become a member of their frequent stay program. Generally, many of the Brands give the internet free as a perk to these loyal guests who give them revenue month after month.

Seriously Kristina? free wifi? not safety, security, cleanliness, location/proximity and rate? I think your company would be disappointed to hear rate is not your decision driver, even if you add wifi charge to it.

As a outside sales professional, I've spent my fair share of nights in hotels. The basis of me choosing a new property in a new city is: 1) Does it offer complimentary Wifi? 2)Is it a respectable Brand? 3)Is it a good overall value? Wifi is my number one choice in selecting a hotel. I think more business travelers would agree with me!

Adam, out of touch...small revenue stream? When's the last time you worked in a hotel? Some are recovering significant costs outlayed with these fees. maybe you're thinking of guest room access only? The meetings side can be huge for some hotels.

There seems to be some misconception that WiFi is cheaper to provide than traditional wired internet connections. Or even free to provide and hotels are making pure profit off the charge. Maybe because you see no cable? WiFi for staff? Huh. maybe in new builds. And even if it was there, there is work to do to segment guests off from staff. In some cases it is even more expensive to provide wireless than wired. But if the infrastructure for both were already in place, there is always the cost of the connection to the backbone of the internet. And users keep demanding more bandwidth every day. Many hotels incur thousands of $$ per month in circuit costs. Hotels should go free when airports, stores, trains, planes and all other public venues offer it free. One mediating solution will likely be to offer free service for basic tasks. Checking email, simple browsing. Perhaps a 512K connection for free. And make the bandwidth hogs or dedicated b/w consumers pay for what they use.

Your arguement seems to be based on capturing more demand if you give it away first. I dont think this is true but more importantly wonder if you have seen hotel P&L's lately. Hotels are barely able to pay debt service with rates dropping more than 20% in most places while taking on additonal costs for wage rates, etc for a net negative NOI in many cases. While you seem to go back in forth on the finanical impact, i can tell you it does not seem to be the time to loose any more revenues on top of the substaintal rate losses nationwide.

This guy is an idiot and truly has not installed and maintained Wifi in a hotel or any other environment.

Do a Twitter search for "hotel wifi." I just did. You can guess what the overwhelming sentiment is. Perhaps that just represents a vocal minority--I doubt it--but even if it does, the point remains. As far as parking goes, nobody in a dense urban area expects to park for free. They do, however, expect free WiFi. That's just reality.

and also you can replace "wifi" with "parking" for many of these points and hotels still charge for parking...

"And almost everyone on Twitter is massively against WiFi charges." Prove it...this quote really weakens your post "The cost of sourcing WiFi is very low. You probably have WiFi in your hotel anyway to allow staff to do their jobs. So the marginal cost of allowing your guests to use it is close to zero. Moreover, your guests are fully aware of this." -in larger hotels there is significant infrastructure that needs to be implemented to give guests access in their rooms. I like the point of the post and somewhat agree with the thesis but the argument has many flaws.

I generally agree, outbound. My point, though, is that free WiFi is going to happen sooner than later. Hoteliers who accept that inevitability and move toward the free WiFi model today have a chance to gain goodwill and market share, at the expense of a relatively small revenue stream that is destined to evaporate anyway.

Charging for Wi-Fi is on par with $7 bottled water in the guest room and no vending machine on the guest floor. When you're spending $200+ per night for a hotel room those sort of charges are just plain offensive.

Good Luck making this happen. Full Service Hotels make too much money from this source for them to just let go of it. In my opinion this is one of those situations where each brand is waiting for the other to make it free before they get on the band wagon. The question then is who will be the first one to give in!

I wholeheartedly agree with Adam and have been saying exactly the same thing for years. Our high-end clients pay enough for their hotel room that free WiFi should be a given--especially since it is at Residence Inns, La Quintas and other lower-priced chains worldwide.I hope hoteliers will listen to Adam--and our clients--or risk losing their goodwill and their business.

Excellent points on the subject as usual, Adam. The "WiFi isn't free for my hotel, so why should I offer it free to my guests?" argument always baffles me. It seems hoteliers still do not see Wi-Fi/Internet service as being on the same level as other amenities in the hotels for some reason. They seem to prefer to skimp on something (Wi-Fi/broadband) that probably makes more of a difference to most people (particularly business travelers), and instead invest in frills like flat-screen HDTV's, which while impressive for about the first 2 minutes you're there, do little to actually improve your stay. Keep up the good fight!