The “Just-Like-Home” Hotel Connectivity AdvantageHow Hotels Are Driving Occupancy and Revenue by Meeting Guest Wi-Fi and HD Expectations

Michael HarrisKinetic Strategies

INTERNET | VOICE | TELEVISION | NETWORK SERVICES | CLOUD SERVICES

The “Just-Like-Home” Hotel Connectivity Advantage

Research finds 84 percent of U.S. households with at least $50,000 in annual income have high-speed Internet access¹ and own a high-definition television (HDTV).² Not surprisingly, when connected consumers check into a hotel for leisure or business travel they demand “just-like home” broadband amenities. A recent survey of travelers who have stayed at a hotel within the past three months found that 83 percent had smartphones and laptops. Nearly one-third of leisure travelers reported bringing a gaming system with them.³

In today’s market delivering high-quality connectivity has become a business necessity for hotel properties, offering a powerful way to boost occupancy, revenue and guest satisfaction. A recent analysis by the Cornell Center for Hospitality Research found that scoring a 1-point increase on Travelocity's 5-point rating scale allows a hotel to raise itsroom price by 11 percent without sacrificing occupancy or market share upside.4 Enhancing Internet-savvy guest satisfaction clearly drives a hotel’s bottom line.

Guest Internet Expectations on the Rise With consumers owning an average of 2.6 devices capable of wireless Internet connectivity, such as a smartphone, tablet or laptop,5 it is not surprising that broadband Wi-Fi access now ranks as the most valued hotel amenity among U.S. travelers.6 Unfortunately, hotel guests also report frustration with Internet connectivity to be the number-one problem during their stay.7 The lodging industry is getting the message. A survey by Hospitality Technology found that “connectivity is the key driving force shaping IT projects in 2014.”8 Two out of three hotel technology executives say they plan to add Internet bandwidth in 2014 to address guest expectations for broadband Wi-Fi.

Four Points by Sheraton Ventura Harbor Resort recently upgraded its Internet connectivity to match its idyllic location and accommodations on California’s Gold Coast. The T-1-based Internet service provided by a local telephone company was not meeting the resort’s standards. “We were getting many complaints about Internet speeds and the service dropping,” explained General Manager Victor Dollar. “It was beginning to have a negative effect on our reputation.” Switching to a fiber-based dedicated Internet access solution from Time Warner Cable Business Class has delighted guests. “Now, I’m receiving compliments about our Internet service,” Dollar added.

Some service providers, including Time Warner Cable Business Class, offer comprehensive guest Wi-Fi solutions in addition to dedicated Internet access connections for hotel properties. These solutions include managed guest Wi-Fi authentication and access while supporting a wide range of bandwidth and pricing models. Hotel properties, for example, may provide free basic Wi-Fi access to guests and offer enhanced service tiers for an additional fee. Such an approach can improve the quality and consistency of the guest Wi-Fi experience, as well as increase service profitability by encouraging power users to pay for the extra bandwidth needed for applications like streaming video and teleworking.

1

“Wi-Fi Internet access now ranks as the most valued hotel amenity among U.S. travelers.”

How Hotels Are Driving Occupancy and Revenue by Meeting Guest Wi-Fi and HD Expectations

¹Leichtman Research Group, “HDTV and 3D TV X,” February 2013²Pew Research Center, “Home Broadband 2013”³“Winning Customers’ Hearts Starts With A Great Guest Wi-Fi Service,” Forrester Consulting, May 20134“The Impact of Social Media on Lodging Performance," Chris K. Anderson, Cornell Center for Hospitality Research5“What Do Consumers Want from Wi-Fi?” Cisco Systems, May 20126TripAdvisor Survey Reveals Wi-Fi is Tops in U.S., January 31, 20127J.D. Power 2013 North America Hotel Guest Satisfaction Index82014 Lodging Technology Study, Hospitality Technology

business.twc.com

83%83% of travelers who stayed at a hotel within the past three months had smartphones & laptops

Conference CapacityIn addition to guest satisfaction, the quality of Internet connectivity is critical to hotel conference and event business, a segment that can deliver 15 to 50 percent of a property’s overall revenue.9 Indeed, according to a survey of 750 meeting planners, 82 percent considered “good Wi-Fi” to be “very important” when selecting a property. For their largest events, 94 percent of meeting planners said wireless Internet was a requirement for booking.10

This can be a challenge for hotels because short-term event bandwidth needs may dramatically exceed the property’s everyday Internet access requirements. For example, a best-practices guideline from the Convention Industry Council estimates 11 Mbps of Internet bandwidth is required for each 100 conference attendees, assuming medium usage levels and multiple devices per user.11

By leveraging a Time Warner Cable Business Class solution that allows short-term increases in the speed of their Internet connection, Four Points by Sheraton Ventura Harbor Resort is now able to meet peak event bandwidth demands. “When we need higher bandwidth, I just call… and we’re able to schedule it for a specified period of time, and then scale it back to normal afterwards,” explained Dollar. “That flexibility is really important because it means we don’t have to pay for extra bandwidth during the times we don’t need it.” Dollar says the Internet connectivity upgrade helped the hotel retain a valued conference client that delivers more than $1 million in annual revenue.

Working with some service providers, hotels are now able to schedule, manage and view Wi-Fi Internet usage of their conference facilities in real time. Reports display event-specific bandwidth usage for managing peak demand. To improve the user experience, management is also able to quickly create unique Wi-Fi network IDs and log-in pages for each conference or event.

Cloud Connectivity The investments a hotel makes to improve the Internet experience of guests may also help drive productivity and revenue across the enterprise. Property management systems (PMS) are the lifeblood of hotel operations, handling everything from reservations and billing to room service. Increasingly, hotels are moving many of these functions to the cloud rather than managing them through premises-based IT infrastructure. Indeed, 40 percent of hotels report they are migrating key applications to the cloud.12

Food and Hospitality World explains why: “The total cost of ownership of a cloud based solution is typically less expensive than that of a locally hosted network. In most cases locally installed software requires license fees, periodic upgrade costs, the establishment and maintenance of servers, workstations and operating software.” However, the hospitality industry publication cautions that “an uninterrupted internet connection is vital to a cloud based computing experience.”13

To both deliver a superior Internet experience for its guests and ensure the performance of its own business applications, the Sheraton Imperial Hotel & Convention Center in Durham, N.C., tapped Time Warner Cable Business Class for Internet, telephone and video services. “Our hotel relies on technology,” explained General Manager Michael Martino. “There is no opportunity for downtime in our operation.”

2

“94 percent of meeting planners say wireless Internet is a requirement for their largest events.”

“40 percent of hotels are migrating key applications to the cloud.”

¹Leichtman Research Group, “HDTV and 3D TV X,” February 2013²Pew Research Center, “Home Broadband 2013”³“Winning Customers’ Hearts Starts With A Great Guest Wi-Fi Service,” Forrester Consulting, May 20134“The Impact of Social Media on Lodging Performance," Chris K. Anderson, Cornell Center for Hospitality Research5“What Do Consumers Want from Wi-Fi?” Cisco Systems, May 20126TripAdvisor Survey Reveals Wi-Fi is Tops in U.S., January 31, 20127J.D. Power 2013 North America Hotel Guest Satisfaction Index82014 Lodging Technology Study, Hospitality Technology

9“Conferences and Events: The New Frontier of Revenue Management,” Hotel Executive 10STR Destination Map 2013 survey, Hotel News Now11APEX Event Bandwidth Estimator for Meetings and Events, accessed at http://www.conventionindustry.org/StandardsPractices/APEX/Bandwidthconnectivity/bwidthestimator.aspx122014 Lodging Technology Study, Hospitality Technology13“Cut your IT costs with RMS Cloud solution,” Food and Hospitality World, August 21, 2013

business.twc.com

“82 percent considered “good Wi-Fi” to be “very important” when selecting a property. “

82%

“51 percent of hotels are leveraging mobile solutions for customer-facing applications.”

“People call before they make a reservation to check on TV technology and channel lineups.”

3

Enabling Mobility In addition to migrating applications to the cloud, hotels are also making them mobile. For on-site guests accessing mobile applications, the property’s broadband Wi-Fi network becomes an essential customer service interface. In a recent survey half of hotel technology executives said their companies were leveraging customer-facing mobile applications.14

With reliable Internet access and hotel service applications, guests can use their mobile device to manage their reservations, check in and out, order room service, schedule a wake-up call, book a spa session, contact the concierge or housekeeping, or request their vehicle from the valet. The IT director of a leading hotel in Los Angeles that has deployed a comprehensive services app says half of their guests now use it.15

Hotels are also providing mobile applications to employees to improve the efficiency of essential services, such as housekeeping. Housekeeping applications enable staff to share progress reports and update a room’s status with their mobile device through the hotel Wi-Fi network, providing supervisors and the hotel’s front-desk staff with up-to-the-minute room information. One solution provider reports that mobile apps deliver an average 50-percent reduction in the time required to carry out housekeeping and hotel support tasks.16

The High Value of HD VideoBesides going online, when it is time to unwind tech-savvy travelers want towatch live HDTV programming. They also want to be able to connect their mobile devices to the hotel television to access Internet-delivered video entertainment. Hotels with robust Internet and HD video services are poised to please on both counts. “People call before they make a reservation to check on TV technology and channel lineups,” said Michael Martino, general manager for the Sheraton Imperial Hotel & Convention Center. “Our services have always been great. However, we needed more variety to meet client expectations, and we could not make a large capital investment in hardware.”

The Sheraton Imperial turned to Time Warner Cable Business Class for an HD video service solution. The HD video service is delivered through a small set-back box mounted on the rear of each HDTV, without requiring an investment in expensive network equipment. According to Martino, “Time Warner Cable Business Class offers a superior product and has met our budget needs.”

The DoubleTree by Hilton Buffalo Downtown, in Buffalo, N.Y., selected a similar Time Warner Cable Business Class solution that offers more than 50 HD video channels to guests, plus on-demand options and an intuitive onscreen guide that can be customized with the hotel’s logo and brand colors. “The feedback we’ve received from our guests in response to the additional HD choices we are able to provide has been tremendous,” said Elaine Sarkis, the hotel’s general manager.

Selecting a Hospitality Connectivity ProviderThrough an extensive survey of industry professionals in 2014 Hospitality Technology concluded: “Hotel executives are well aware of the importance that guests place on being connected, and that these areas are in need of improvement and updates.”

9“Conferences and Events: The New Frontier of Revenue Management,” Hotel Executive 10STR Destination Map 2013 survey, Hotel News Now11APEX Event Bandwidth Estimator for Meetings and Events, accessed at http://www.conventionindustry.org/StandardsPractices/APEX/Bandwidthconnectivity/bwidthestimator.aspx122014 Lodging Technology Study, Hospitality Technology13“Cut your IT costs with RMS Cloud solution,” Food and Hospitality World, August 21, 2013

142014 Lodging Technology Study, Hospitality Technology15“Mobile APPs and Their Impact on Hospitality,” Hotel Executive 16“Quadriga launches new mobile housekeeping app,” November 9, 2013

business.twc.com

“Hotel executives are well aware of the importance that guests place on being connected, and that these areas are in need of improvement and updates.”—Hospitality Technology

4

Because Internet and HDTV service quality have become a foundation for success of the entire property, selecting the right service provider is critical. Considering the following six factors will help hotels when evaluating service providers for connectivity.17

1. Facilities-Based Foundation: When evaluating Internet and video service options, select a provider that owns its last-mile network and can offer future-proof fiber-based solutions. Facilities-based providers with broad network reach are better able to guarantee service quality. Using a variety of access technologies, they may also be able to serve a wide range of locations, including resorts and hotels located in residential areas.

2. Bundle Benefits: Some facilities-based providers are able to offer a complete bundle of Internet, video and telephone services. Purchasing these services together may yield cost savings and simplify management with a single bill to process and one number to call for support.

3. Service Level Agreements: Because Internet, video and voice reliability are so important to a hotel property’s success, select a provider that offers service level agreements (SLAs). Such agreements set performance benchmarks for service reliability and, should an unplanned outage occur, responsiveness for repair and restoration.

4. On-Demand Bandwidth: The bandwidth demands of special events often exceed a hotel’s everyday Internet access needs. Service providers that can quickly provision additional bandwidth for scheduled time periods and return service to standard levels allow a hotel to purchase only the capacity it actually needs.

5. Guest and Conference Wi-Fi Solutions: Service providers that offer managed guest and conference Wi-Fi services, in addition to Internet access, can accelerate real-time service deployment and simplify management. Such turnkey offerings help properties offer best-in-class connectivity solutions without burdening local hotel IT staff.

6. Comprehensive HD Video Offering: High-definition video is highly valued by guests. Successfully delivering in-room HD services requires that a service provider meet the unique requirements of each hotel property. For example, some hotels may require that an HD video service integrate with Pro:Idiom or other infrastructure that is already installed. Other properties may prefer a turnkey HD video offering without on-site headend integration or capital expenditures. Choose a video service provider with the experience and flexibility to accommodate a property’s unique infrastructure and business requirements.

The New Business NecessityHigh-quality connectivity has become a business necessity for hotel properties, offering a powerful way to boost occupancy, revenue and guest satisfaction. By partnering with a service provider that can enable a “just-like home” broadband Internet and HD video experience, hotel properties gain an edge in today’s competitive lodging market.

142014 Lodging Technology Study, Hospitality Technology15“Mobile APPs and Their Impact on Hospitality,” Hotel Executive 16“Quadriga launches new mobile housekeeping app,” November 9, 2013 17 2014 Lodging Technology Study, Hospitality Technology

business.twc.com

5

About the AuthorMichael Harris is principal consultant at Phoenix, Arizona-based Kinetic Strategies, Inc. Applying more than 15 years of experience as a strategist, research analyst and journalist, Michael consults with select clients in the networking, Internet and telecommunications industries.

About Time Warner Cable Business Services Time Warner Cable Business Services, a division of Time Warner Cable, offers a full complement of business communications tools to small, medium and enterprise-sized companies under its Time Warner Cable Business Class brand. Its Internet, voice, television, network and cloud services are enhanced by award-winning customer service and local support teams. Through its NaviSite subsidiary, Time Warner Cable Business Services also offers scalable managed services, including application services, enterprise hosting and managed cloud services primarily in the U.S. and U.K. Time Warner Cable Business Services, founded in 1998, serves approximately 625,000 business customers throughout Time Warner Cable's service areas. For more information, visit http://business.twc.com.

© 2014 Time Warner Cable. All Rights Reserved.

¹Leichtman Research Group, “HDTV and 3D TV X,” February 2013²Pew Research Center, “Home Broadband 2013”³“Winning Customers’ Hearts Starts With A Great Guest Wi-Fi Service,” Forrester Consulting, May 20134“The Impact of Social Media on Lodging Performance," Chris K. Anderson, Cornell Center for Hospitality Research5“What Do Consumers Want from Wi-Fi?” Cisco Systems, May 20126TripAdvisor Survey Reveals Wi-Fi is Tops in U.S., January 31, 20127J.D. Power 2013 North America Hotel Guest Satisfaction Index82014 Lodging Technology Study, Hospitality Technology9“Conferences and Events: The New Frontier of Revenue Management,” Hotel Executive 10STR Destination Map 2013 survey, Hotel News Now11APEX Event Bandwidth Estimator for Meetings and Events, accessed at http://www.conventionindustry.org/StandardsPractices/APEX/Bandwidthconnectivity/bwidthestimator.aspx122014 Lodging Technology Study, Hospitality Technology13“Cut your IT costs with RMS Cloud solution,” Food and Hospitality World, August 21, 2013142014 Lodging Technology Study, Hospitality Technology15“Mobile APPs and Their Impact on Hospitality,” Hotel Executive 16“Quadriga launches new mobile housekeeping app,” November 9, 201317 2014 Lodging Technology Study, Hospitality Technology

17 2014 Lodging Technology Study, Hospitality Technologybusiness.twc.com