Kiosks Move into Hotel Rooms

In the hotly contested hotel space, Wi-Fi vendors are looking beyond the lobby, bar and meeting rooms. They’re pitching full-building solutions as an alternative to costly high-speed rewiring jobs, and the idea is gaining traction.

Take, for instance, PayKiosks Internet Terminals. Founded in 2000, the company stayed true to its name for a long time, building up a base of some 300 installed Wi-Fi kiosks in 300 hotels and truckstops. Users pay the typical rates: $4.95 an hour, $8.95 a day and $29.95 a month.

More recently, though, the company has begun to roll out whole-property solutions. Earlier this year, for example, PayKiosks made wireless LAN available throughout all guest rooms in two downtown San Francisco Executive Inn hotels, as well as in the University Inn at Berkeley.

The company deploys its networks by linking hotspots to the Internet via existing cable TV wiring. “This way, we are not punching holes in walls, getting into their ceilings, ripping up carpets,” says PayKiosks’ president, Scott McInnes.

With this streamlined tactic, McInnes says he can deploy wireless throughout a hotel in just one to two days. That kind of minimally invasive approach has been welcomed by hoteliers, who dread both the expense and the disruption of a major networking installation.

PayKiosks deploys its networks for free on a revenue-sharing basis. McInnes says laptop use is so high these days that he can make the free installations pay even in smaller hotels. “Anything over 100 rooms is definitely a viable location for us,” he says. “We have lots of smaller properties that generate several thousand dollars a month in wireless usage.”

In cases where a hotel offers Wi-Fi as an amenity rather than as a revenue generator, McInnes will still deploy a system. Hotel managers in such instances will pay him a monthly fee to maintain and manage the Wi-Fi network, with the fee varying depending on the size of the property.

There you have the sales pitch: convenience, cost … and let’s not forget fear. As the company’s sales literature is quick to point out, hoteliers have a lot to lose by undertaking a less-than-stellar Wi-Fi installation.

Mere consumer-grade Wi-Fi routers in the lobby leave a hotel open to security issues, the company says, and with the hotel acting as a de facto WISP, this opens up a scary liability window. Better to let the professionals handle it, or so the theory goes.

Compliance issues, too, have worked in PayKiosks’ favor, especially in cases where first-time Wi-Fi deployments may not be up to the standards imposed by the newer hotel-chain mandates being passed down to local properties. “We had a Best Western in Sacramento and the owner there was having his Wi-Fi system inspected by the Best Western home office,” McInnes says. “He didn’t think it would pass. It was just very unreliable and very slow.”

McInnes is not putting all his efforts into these hotel-wide deployment markets, however. Kiosks remain a strong product line, and analysts say that mix presents a wise business strategy.

While in-room Wi-Fi is nice for those with laptops, “the kiosk is an additional access option for consumers without equipment,” says Ina Sebastian, a research associate with Jupiter Research.

Despite increased laptop usage, Sebastian says, there remains a marked need for alternate means of access. “When we asked consumers which factors prevent them from accessing the Internet at public hotspots, the number two reason was, ‘I don’t have a laptop or portable device” (37 percent), after the lack of need/desire to use hotspots (54 percent),” she says.

Still, McInnes is betting on hotel-wide deployments as the long-term success strategy, and he is gearing up his marketing efforts to match. He hits the hotel-technology trade shows, and pays an outside firm to ensure top positioning for PayKiosk on web searches related to hotels and wireless needs.

It’s true, he says, that hundreds of Wi-Fi vendors are looking to hotels as the most promising potential market for their wares. On the other hand, “there are tens of thousands of hotels out there,” he notes. “This is not a small market by any means.”

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