Photo courtesy Hilton Worldwide
Hotel companies have long given up trying to make a profit in the Internet arena, but in the last year they've introduced a tiered Wi-Fi system they hope can at least atone for a portion of their investment, while accommodating guests' ever-increasing demand for faster Internet speeds and higher bandwidth.
Marriott International introduced tiered Wi-Fi about a year ago through its Marriott Hotels & Resorts, JW Marriott and Renaissance Hotels brands.
Since then, a host of hotel companies and brands have followed suit, including Hilton Worldwide, Hyatt, Omni Hotels & Resorts, MGM Resorts International and Loews Hotels & Resorts.
Even when companies that operate hotels don't introduce tiered Wi-Fi brand-wide, some owners of the hotels are taking the initiative. Four Seasons West Lake Village in Los Angeles, owned by Castle & Cooke, introduced tiered Wi-Fi 18 months ago.
But why the sudden change?
Well, like anything in the hospitality industry, guests tend to dictate the tempo. "The people" have the power, if you will.
Hilton conducted a poll of guests and that spring-boarded the company's tiered Wi-Fi service.
"What became clear was that there was a small and growing number of guests that were willing to pay a nominal fee for greater access," said Josh Weiss, vice president of guest technology, Hilton Worldwide.
"About 25 to 30 percent of guests said that at some time it would helpful to them and they would be willing to purchase it," Weiss added.
In turn, Hilton introduced the service through its focused-service and extended-stay brands in January (Hampton, Homewood Suites by Hilton, Home 2 Suites by Hilton and Hilton Garden Inn).
Brian Johnson, general manager of Loews Hollywood Hotel (which will finish up an extensive renovation in about a week), said it was important to still offer free Wi-Fi to guests, while also giving them the option to receive higher speeds through the Los Angeles property's second tier.
"We decided that it was important that customers were highly connected and remain in the know when they're on the road. They expect certain services to be included with their stay," Johnson said of Loews Hollywood Hotel's free Wi-Fi.
But "you also have those individuals that require higher bandwidth and higher speeds," Johnson added.
Hilton's high-speed Internet ranges from about $3.95 to $5.95 for 24 hours of service, with $4.00 being the general price, but the price ultimately depends on the market, Weiss said. Hilton's high-speed Internet service includes the ability to use up to three devices.
Loews Hollywood Hotel's high-speed access costs $14.95 per 24 hours, but it allows guests to use up to eight devices.
Hyatt offers free high-speed Internet access at its Park Hyatt, Andaz, Hyatt House and Hyatt Place properties.
For Hyatt Regency, Grand Hyatt and Hyatt Hotels, the cost for high-speed Wi-Fi is generally anywhere from about $9.95 to $14.95 a day. These hotels offer 24-hour packages, two-to-three-day packages and seven-day packages.
MGM Resorts International announced the completion of its extensive Wi-Fi expansion in October 2013, collaborating with Mobilitie and Cisco Systems to offer a free and tiered Wi-Fi system across its Las Vegas portfolio, including Bellagio, MGM Grand, Mandalay Bay, THEhotel, the Mirage, ARIA, Vdara, the Shops at Crystals, Monte Carlo, New York-New York, Luxor and Excalibur.
According to MGM Resorts, its high-speed Internet offers speeds up to 30 percent faster, and up to 10 Mbps for convention attendees.
The question is: Is this trend here to stay or is it purely an experimental or temporary offering?
It's hard to say for sure, but both Weiss and Johnson appear to believe tiered Wi-Fi isn't going away anytime soon.
"I think people are getting used to tiered types of service," Weiss said. "Tiered access, as long as it's clearly explained... is here to stay."
"I think it's important to keep in mind that expectations continue to change," Johnson added. "It's a changing world and we need to adapt to the climate we're living in."
Johnson confirmed that many guests are not only accepting the tiered system, but have actually "embraced it."
"We're excited about the response we've received," Johnson said. "Folks understand they're going to have to pay a small fee (for higher speeds) and they've embraced it."
As for attempting to charge for standard Wi-Fi to make a profit, hotel companies can basically forget about it now.
Said Johnson: "There are things in the industry that are just expected, and Wi-Fi is one of them. I don't think there will ever be a day where we can go back and charge for standard Wi-Fi."
Apparently, the best things in life are free, but you can always pay a little extra for better versions of them.
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