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Monday, Dec 4, 2023

LEAD STORY–Hotels Venture Into Unknown Internet Territory

Will the imminent presence of Internet access in hotel rooms soon become a high-tech re-creation of the gunfight at the OK Corral?

It will, said Carl Winston, chief operating officer of the locally based hospitality and technology management firm Trigild Corp.

“I would liken what’s happening in high-speed Internet access to a Wild West shootout,” Winston said. “Really, no one knows what’s going to happen and what it’s going to look like two or three years from now.

“But all hotel operators, us included, feel it’s a place where we have to be and we’re just not quite sure, as an industry, of the best way to approach that.”

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– Hotels Keep Up

With Technology

As guests’ needs evolve, along with technology itself, hotels face the ongoing prospect of updating their Internet and E-mail offerings.

Among them is the Catamaran Resort Hotel in Pacific Beach. General manager Luis Barrios said his hotel has begun looking for a system and a company to handle the transition.

One possibility is for the hotel to share profits with the company that brings in their equipment and installs it, Barrios said.

It’s a common practice, said Winston of Trigild. Hotels have traditionally been cautious about spending money on technology, he said.

Eric Unruh, who oversees information technology for the Evans Hotels, which includes the Catamaran and the Bahia hotels on Mission Bay, described the deals that are possible with one provider.

Installing high-speed access to the Catamaran’s 313 guest rooms would cost $28,000, at $85 per room, Unruh said. Each month, there would be a $1,200 charge for the T-1 lines, he said.

– Internet Access

Could Cost Extra

Those costs could be recouped by charging guests for the access. A likely price for guest room access would be $9.95 per 24-hour period, and between $10 and $100 for meeting room hook-ups.

Depending on who pays for the installation, there would be a set structure for dividing any revenue and how long the deal would last, he said.

The first option was what Unruh called “free to install.” The vendor would absorb the $28,000 cost, and the hotel would pay the monthly access charge. For the five-year deal, the vendor and hotel would split the revenue 70-30.

In another five-year option Unruh described as “free to the hotel,” the hotel doesn’t pay the monthly fee or the installation costs, and the vendor takes 90 percent of the revenue.

In a three-year “partnership deal,” however, the hotel pays the $28,000 installation, and the monthly access charge, and keeps any revenue over 50 percent per day, and 100 percent of the first 100 uses in the meeting and guest rooms each month. After that, the hotel and vendor would split it 50-50, Unruh said.

– Selling Advertising

On The Home Page

Another deal major hotels have started is selling advertising on the home page, Winston said.

So far, that appears to work best for the large-scale hotels with millions of guest rooms to market, he said.

For older properties in the market, installing the Internet technology can be a game of catch-up, Barrios said.

“We are under constant pressure to make sure our guests are getting what they really expect,” he said. “The new hotels are really pacing the market, so we’ve got to keep up with them.”

Beyond the needs of individual guests, many of the meeting groups that come to hotels today want the technology for teleconferencing and educational programs, Barrios said.

The process will likely be easier for the Lodge at Torrey Pines, another Evans hotel, Barrios said.

That hotel will undergo an extensive renovation in September, he said.

– Catamaran Hosts

Commercial Travelers

At the Catamaran, commercial travelers make up about 60 percent of the hotel’s business, Barrios said.

The remaining 40 percent, leisure travelers, arrive during the summer and will also be lured by the entertainment provided by high-tech options, he said.

Changes in Internet access would not boost room rates, Barrios said.

According to Winston, most hotels charge a fee of about $10 for Internet access. However, it’s not the case in tekkie markets such as Silicon Valley where the hook-ups are compulsory and automatically included, he said.

HotelParisi, a 20-room boutique hotel along La Jolla’s Prospect Street, opened last May with separate dial-up lines for phones, faxes and the Internet, said general manager Martina Hasek.

They haven’t made any updates since then, but keep alert to technological developments through industry publications, visiting other hotels, and contacts with the San Diego Convention & Visitors Bureau, Hasek said.

– Investment Includes

Hiring On-Site Staff

Part of a hotel’s investment in technology can be the hiring of on-site staff. The Evans Hotels hired Unruh last year for the new IT manager position, for instance.

The Four Seasons Resort Aviara, North San Diego has a three-person information technology team, said general manager Brian Parmelee.

According to Parmelee, the team makes monthly presentations at the hotel’s senior management meetings to keep them updated on technology developments.

The Carlsbad property has about 10 meeting rooms, all of which have high-speed Internet access, Parmelee said.

Each of the hotel’s 331 guest rooms has a separate data port phone line for Internet access, he said.

– Demand For Services

Expected To Increase

Although it hasn’t been concluded, Aviara is looking at DSL or T-1 lines for all its guest rooms, Parmelee said.

“We’re finding that there are some people who are looking for that type of technology, but we foresee in the future that it’s going to be something more and more people are going to want,” he said.

“We wanted to get ahead of the trend, rather than be reacting to people asking for it.”

Aviara’s IT team keeps up with industry developments through researching the Internet, talking to their vendors, communicating with other system managers in their company and attending the major tekkie shows, Parmelee said.

Traditionally, hotels would have a single systems manager rather than a team, Parmelee said. The team administers all of the hotel’s systems, he said.

As guests’ needs for technology and the Internet increase, hotels’ ability to accommodate them expands, Parmelee said.

“It’s all one, really,” he said. “As more information is available to our guests, the more efficient we can be, and people really expect to have that speed of service and that efficiency that the systems offer us.”

– Next In Line:

Internet At The Gym

Next up: the Internet on the exercise machines in the hotel’s gym, Parmelee said.

The hotel chooses a technology budget each year, he said. He didn’t have financial details.

“This is certainly on the top end of our priority list, because it’s really what the customer’s looking for,” Parmelee said.

The Catamaran’s Barrios recalls watching fax machines become a necessity. Now, he’s watching the same thing happen with the Internet, he said.

“It’s growing so fast that right now is the time to do it,” Barrios said. “It’s an evolution. It has been coming, and the more we get into it, the more we see people traveling with their own laptops and people who need to have access to the Internet with their business.”


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