Hotel Online Special Report


Wireless Changes Everything
So, do ya want a latte with that or what?
This article is from the upcoming Summer 2003 issue of Hospitality Upgrade magazine.To view more articles covering technology for the hospitality industry please visit the Hospitality Upgrade Web site or to request a free publication please call (678) 802-5303 or e-mail.
by Jocelyn Valley, June 2003

Wireless is allowing people and businesses to communicate and operate in ways that have historically been impossible. On its way to exploding into a multi-billion dollar industry in the next few years, wireless has already attracted millions of users. Hospitality companies have a unique opportunity to increase the value of their core products and services by providing a wireless infrastructure for customers to connect to the Internet, check e-mail and utilize corporate applications. In addition, there is a significant opportunity for businesses to benefit from the network by offering customized guest amenities and equipping employees with wireless devices to improve upon current operational inefficiencies.

As the first large retail chain to deploy wireless, Starbucks has established approximately 2,000 wireless-enabled stores worldwide. While there has been an abundance of positive publicity around the deployment, users accessing the network are few and far between. At each location, between one and five people are estimated to be using the service every month, at a rate of $6.00 per hour for one-time use or $39.99 per month for unlimited access. 

In a similar manner, McDonald�s has recently begun a pilot deployment at 10 stores in New York city, with several hundred more planned by year end. Customers receive 60 minutes of wireless access free with the purchase of an Extra Value Meal or can buy access for $3. The deployments are too recent to confirm the degree of success, but the initial pattern seems to be similar to that of Starbucks with relatively low customer usage.

Wireless at McDonald�s is a tougher sell because of the typical clientele. With more of a family-oriented environment than other merchants, McDonald�s is generally not considered a place where typical customers would bring their laptops. With the model still in its infancy and almost certain to change, businesses must be creative to lure customers into using the infrastructure. One way to do this may include renovation of current facilities to cater to laptop-savvy customers by adding comfortable seats, wireless printers and a workspace with enough room for both a PC and a burger. Another option is to offer free telephone calls via voice-over IP (VOIP), a technology that sends voice over the network in a similar manner as data. While VOIP is currently in development, the functionality will offer significant opportunity for stores of the future.

Above and beyond providing customer access, wireless can offer customized customer experiences and improve upon current operational inefficiencies.In instances where speed of delivery makes or breaks a business, as is the case of McDonald�s, creative �line-buster� solutions can be deployed. These wireless tools range from remote ordering kiosks (staffed or unstaffed) and digital menu boards to devices that automatically control equipment.

Another area where wireless infrastructure is key is within the lodging space. Guest Internet access is becoming a standard amenity throughout the industry and travellers will soon find it as necessary as ice machines and cable television. Industry research recently conducted by IBM indicates the percentage of guests accessing wireless has been seen to exceed 20 percent in some cases, much greater than the uptake at food and beverage outlets. This is a key indicator that wireless is on the rise.

With a significant majority of hotels indicating Internet access can have an impact on occupancy, installing wireless needs to be considered in addition to wired solutions because of greater flexibility, faster implementation, fewer connectivity issues and reduced capital investment. In more and more cases, the availability of in-room, public space and meeting room access is a make-or-break decision for both the independent traveller and meeting planners of small and large group events.

Operational improvements can be realized when wireless devices are used for business functions such as check-in, check-out, bill printing, directions, concierge services, amenity requests, housekeeping, maintenance, point of sale, sales and catering and table management. While the number of these applications currently in use is minimal, redesigning today�s core processes tied to wired solutions will allow hotels to operate more efficiently, empower the guests with more resources and respond to customer requests in a more prompt and accurate manner. 

How Does It All Work?

Wireless uses a family of specifications known as 802.11 to send high frequency signals to and from enabled devices. The most common standard today, 802.11b, provides acceptable connectivity speeds over a broad range of about 300 feet. Using a different approach, recently deployed 802.11a allows for faster data transmissions, but results in a relatively shorter range. In an attempt to improve upon both the connectivity speeds and range of 802.11a/b, 802.11g is currently in development. 

Businesses implement wireless networks for customers and corporate applications two primary ways. In the first option, a local technology department installs access points as an extension of the wired solution. This allows the business to not only receive all revenue from the network but also tags it with the higher risk. The other option is to lease bandwidth from external providers such as telecom companies (T-Mobile, Sprint) or Cometa Networks, a joint venture of Intel, IBM and AT&T. In this revenue-sharing model, the provider ensures proper security, billing, bandwidth control, network maintenance and technical support. 

Using a different approach than installing hotspots, the wireless Internet can also be found through a high-speed cellular system known as 2.5/3G. As an extension to the phone system, wireless devices are given an actual cellular phone number. While the technology is not widespread today and still under development, the portability and flexibility that is opened to users make it a technology that needs to be watched.

What about Security?

Gaps in current wireless standards (802.11a/b) expose some security concerns. The good news is that security is improving in parallel with this emerging technology. A wireless security standard known as 802.11i is targeted to be available the end of 2003. 802.11i is software that works on top of 802.11a/b to improve security features such as user authentication and key encryption. In addition, companies are utilizing other security techniques such as virtual private networks (VPN) to ensure that users access company information in a controlled environment. While the Internet will never be free from security issues, moving to the 802.11i standard in combination with other security measures at the device level allows wireless to be deployed throughout the industry without serious concerns. 

Decision makers are not to be discouraged by today�s low customer usage since wireless is still in its infancy. The introduction of wireless into daily life has focused to date on business travellers and will start to become mainstream in the next few years. The demand for communication anytime and anywhere is definitely on the rise. As an indicator of this explosion, Cometa Networks has pledged to roll out 20,000 hotspots in the United States by 2007. In addition, wireless is at the top of the list at Intel where the Centrino chipset, built specifically to run longer on battery power and connect more easily to wireless networks, was recently released.

With the tethers of wires removed, only a lack of creativity can limit the future possibilities of wireless. While the number of users today may not be impressive, the deployment of thousands of additional hotspots, decreased security concerns and more readily available wireless devices will strengthen today�s demand and make it a commodity across all food and beverage facilities, coffee shops and hotels. Wireless must be considered today � and even more opportunity exists for the future. The potential value can serve as a competitive advantage by enhancing customer amenities and transforming fundamental business processes to bring about greater customer satisfaction and employee efficiency.
 
 

Jocelyn Valley is an IT specialist for IBM in the travel and transportation industry. She can be reached at [email protected].

 

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©Hospitality Upgrade, 2003. No reproduction or transmission without written permission.

Contact:

Geneva Rinehart
Associate Editor
Hospitality Upgrade magazine 
and the Hospitality Upgrade.com website
http://www.hospitalityupgrade.com
[email protected]

 
Also See: Your Magnificent Selling Machine; Would you Prefer Your Hotel to Get: the Web Hit or the Phone Call? / Robert Camastro / Hospitality Upgrade Magazine / April 2003
Tradeshows & Economic Soldiers / Dan Phillips / Hospitality Upgrade Magazine / April 2003
Hotel Telecommunications in the 21st Century / Geoff Griswold / Hospitality Upgrade Magazine / March 2003
The ABCs of CRM  / Mark Haley & Bill Watson / Hospitality Upgrade Magazine / March 2003
Getting the Most out of Your IT Investment / By: Clay B. Dickinson / Hospitality Upgrade Magazine / Fall 2002
The Role of Paper in a Digital World / By: Bill Fitzpatrick / Hospitality Upgrade Magazine / Fall 2002
The Rotten Pineapple (international symbol of hospitality) / By: Steve D'Erasmo / Hospitality Upgrade Magazine / Fall  2002
Focusing on Labor Can Improve More Than Just Cost / Hospitality Upgrade Magazine / Summer 2002
Attention Hotels - An Ounce of Prevention is Worth a Pound of Cure / Elizabeth Lauer Ivey / Hospitality Upgrade Magazine / May 2002 
HOSTEC - EURHOTEC 2002 - Room for Improvement / Christel Dietzsch / Hospitality Upgrade Magazine / Feb 2002 
Technology and the Human Touch / Dan Phillips / Hospitality Upgrade Magazine / Spring 2002
Wireless Technology:  Where We Have Been, Where Are we Going? / Geneva Rinehart / Hospitality Upgrade Magazine / Spring 2002
Effective Customer Relationship Management (CRM) Implementations / John Schweisberger and Amitava Chatterjee, CHTP / Hospitality Upgrade Magazine / Fall 2001 
What's Up With Call Accounting Systems (CAS) / Dan Phillips / Hospitality Upgrade Magazine / Fall 2001 
Technology Dilemmas: What have IT investments done for you lately? / Elizabeth Lauer / Hospitality Upgrade Magazine / Summer 2001
Full Circle from Centralized to ASP - The Resurrection of Old Themes and a Payment Solution / Gary Eng / Hospitality Upgrade Magazine / Summer 2001 
A High Roller in the Game of System Integration / Elizabeth Lauer / Hospitality Upgrade Magazine / Spring 2001 
CAVEAT EMPTOR! Simple Steps to Selecting an E-procurement Solution / Mark Haley / Hospitality Upgrade Magazine / Spring 2001 
Your Bartender is Jessie James and He Needs to Pay for College / Beverly McCay / Hospitality Upgrade Magazine / Fall 2000 
Choosing a Reservation Representation Company / John Burns / Hospitality Upgrade Magazine / Spring 2001 
Understanding and Maximizing a Hotel�s Electronic Distribution Options / by John Burns / Hospitality Upgrade Magazine / Fall 2000 
The Future of Electronic Payments - From Paper to Plastic and Beyond / J. David Oder /  Hospitality Upgrade Magazine / Summer 2000
Timeshare Technology Steps Up / by Elizabeth Lauer / Hospitality Upgrade Magazine / July 2000 
Biometric Payment: The New Age of Currency / by Geneva Rinehart / Hospitality Upgrade Magazine / Mar 2000 

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