London Hotels Insight provides up-to-date, independent advice for your perfect stay in London. We research guest feedback, meet management and identify hotels at the top of their game.
Free hotel WiFi: an open letter to hoteliers.
Our open letter is intended as a sharp wake-up call for the hotel business
I was blown away by the incredible reaction to the launch of the London Hotels Insight “Free the WiFi” campaign a few days ago, when we published a list of the best London hotels with free WiFi.
In just two days, it became this blog’s all-time most popular article, illustrating the strength of feeling behind this issue. The article was also widely retweeted on Twitter all over the world within minutes.
For the latest leg of my campaign, I’ve written a hard-hitting open letter to hoteliers with the rationale for “setting WiFi free”. I’ve pulled no punches and apologise in advance if my letter causes offence. Here it is in full:
Dear hotelier,
You have a complex business to run and need to satisfy a wide body of stakeholders. I recognise that this includes your shareholders, employees and investors as well as your guests.
It’s tough to find the right balance and I also acknowledge that “you can’t please all the people all the time”.
However, you can no longer ignore the compelling case to provide free WiFi to all your hotel guests. Here are 8 big reasons why:
1. WiFi is now a “necessity” in every possible sense.
Demand has been fuelled by the growth of mobile devices like new mobile phones and netbooks as well as the traditional laptop.
Nobody minds paying for genuine luxury (a gorgeous bed, well-trained staff, a decent bottle of wine, etc.). But all of us feel cheated if charged for “necessities” like the use of lifts or towels.
WiFi is now very much in the latter category. It looks at best strange and at worst greedy if you charge for it.
Hotel guests put WiFi on a par with drinking water and electricity: there's nothing hoteliers can now do to change this perception
I have no problem about buying an overpriced espresso in your lobby. My espresso is an indulgence which I choose to enjoy at a transparent price.
But if you imposed an “electricity surcharge” for my being there, you’d be going too far. Also, if I’m paying your hotel room rate then I assume electricity to be included – as well as WiFi.
2. The cost of sourcing WiFi is very low.
You may already have WiFi in your hotel anyway to allow staff to do their jobs. So the marginal cost of allowing your guests to use it is usually low. Moreover, your guests are fully aware that WiFi is cheap to source.
The hotel business has historically been set up to maximise the value obtained from each guest. “Upselling” is OK if it’s done subtly and delivers genuine value to the customer.
But charging for WiFi does not offer value. Moreover, there is very little transparency on WiFi fees (see below).
It could perhaps be justified if your hotel were in an isolated location and had to invest in its own satellite dish, but this is surely a very rare case.
Charging for WiFi makes your brand look like a dinosaur
3. Charging for WiFi devalues your hotel brand.
A hotel charging for WiFi is like a grubby market trader putting up a street stall, yelling “Roll up – fresh tap water! £10 a glass!” Do you want to drag your brand down to the level where you look this desperate?
WiFi fees simply make your company look out of touch and won’t help attract the young customer profile vital to any brand’s long-term growth.
4. WiFi charges make your guests angry.
Hotel WiFi charges are always a “nasty surprise” because the whys and wherefores are rarely clear. Everyone knows only that the hotel is hugely marking up the cost of a basic necessity and ripping them off.
Moreover, the charging method is often complex (some hotels charge in time blocks, others for data and some also discriminate between “wired” and “wireless” internet access). Nobody has time to figure this out.
Then there’s the hassle imposed on guests in registering, paying and ensuring they stay within the paid-for deadlines and terms. No wonder that hotels charging for WiFi hardly ever mention it on their websites.
Charging for WiFi simply advertises to the world that you don’t truly empathise with your customers nor understand their lifestyle.
Business guests increasingly reject hotels that charge for WiFi
5. Charging for WiFi drives away corporate guests.
Imagine you’re a meeting planner. Will you choose a hotel that gives you a fixed, transparent budget or one that considers WiFi an “optional extra” (thereby demonstrating that the hotel’s management have no real understanding of modern business)?
WiFi is a particular necessity for business guests who run small firms.
Charging business people for WiFi is like charging for use of the public lavatory in your hotel…it’s just plain tacky.
6. Charging for WiFi is a PR disaster waiting to happen.
The most influential opinion leaders use Twitter and other social media. You ignore at your peril the fact that they’re the “early adopters”.
And most users of Twitter are vehemently against WiFi charges.
If your hotel charges for WiFi, the news will spread rapidly. Moreover, the profile of people who use hotel WiFi is similar to those who write online reviews on sites like TripAdvisor (see below).
By charging for WiFi, your hotel is alienating the world’s most influential online community. It’s not just me saying this. Here is a small selection of the many prominent bloggers firmly against WiFi fees (with links to articles):
James Ellis
James has launched a free hotel WiFi campaign and asked some of the major hotel groups to justify their WiFi charges. Their often defensive responses make for a fascinating read.
Keith Jenkins: Velvet Escape and Velvet Connect blogs
Keith Jenkins is one of the most respected travel bloggers around. He has thousands of Twitter followers hanging on his every word. He also dislikes hotel WiFi charges with a passion, as he explained in a recent blog post.
Gadling
The highly-respected Gadling travel blog has more than 5,000 Twitter followers. It also carried an eloquent recent piece in favour of free WiFi.
The world's leading bloggers are against hotel WiFi charges and can spread the message "for" or "against" your hotel within seconds
Karen Bryan
Karen Bryan is a leading travel blogger who runs the Europe a la Carte blog. Her sphere of influence extends even further as she also runs Top Travel Content Europe (which syndicates content from leading travel blogs including this one). Here’s her view on hotel WiFi:
“In my opinion complimentary WiFi access should be included in the room rate. If potential guests shun hotel groups which charge for WiFi this should compel others to include the service.”
The above are all influential travel bloggers.
The question you should ask as a hotelier is: do you want them batting for your hotel brand or against it?
7. Free WiFi will enhance your hotel’s reputation
The converse of the arguments above is that you’ll enhance your reputation by providing free WiFi. All else being equal, this will ultimately be reflected in a higher TripAdvisor ranking (though it’s clearly not the only factor).
Consider these facts for London which I’m sure apply to other major destinations. On 10th November 2009, 7 out of the top 10 London hotels on TripAdvisor’s rankings provided free WiFi.
Research by London Hotels Insight also showed that 13 out of the top 20 hotels on TripAdvisor on 10th November 2009 had free WiFi.
The 7 that charge for WiFi (I personally phoned most of them to check) were often a bit defensive in explaining their charges. There are few hotels that dare to clearly state on their website “we charge £x for WiFi”.
Even for hotels that charge for WiFi which are still doing well on TripAdvisor, the few negative comments often relate to WiFi: guests are genuinely shocked that an otherwise great hotel takes such a backward stance.
I urge you to read some guest reviews to verify my findings for yourself.
Hoteliers should not try to swim against the tide of technology and the way people want to live, work and play today
8. Free WiFi is coming whether your hotel supports it or not
You cannot reverse a technology trend (the growing use of internet-connected devices) nor can you swim against an irresistible consumer tide.
I’m convinced that universal free hotel WiFi is inevitable and it’s only a question of “when”. Do you want to be the last hotel left standing, letting your competitors reap all the benefits to the detriment of your reputation?
I hope the above reasons are compelling enough for you to sell the idea of “free WiFi” internally within your hotel company.
Here are some further suggestions to make it more palatable:
• Increase your room rates and offer free WiFi. Taking this stance is much more transparent, though given the low delivery cost of WiFi it’s not clear to me why you’d need to increase room rates at all.
• Get rid of costly extras that guests don’t need…and give them free WiFi instead! I’ll leave the last word to James Ellis (mentioned above) who wrote a beautifully-succinct tweet on this very issue:
“Keep the choc on the pillow and just get me online. It’s 2010 (nearly).”
Yours sincerely,
Rajul
London Hotels Insight
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Bravo! I fully support your campaign to educate hoteliers, and hope many of them will pay close attention to this post and the issue.
Free WiFi is the single deciding factor for me these days when I book a hotel. No free WiFi? I don’t stay there, period. As a busy entrepreneur, I can’t afford to not be able to get online quickly and easily at my convenience, and I resent those hotels who force me to pay a daily charge for what might amount to only an hour or two of work.
However I disagree with your suggestion to simply increase the room rate and bury a WiFi charge there – I do compare room rates when booking also and don’t like the thought of being overcharged so that a hotel can make an obscene profit on something that costs them little to nothing.
Instead I agree with James Ellis – I don’t need a chocolate on my pillow, I can re-use my towels for a couple of days, and really don’t need a fancy, CD playing alarm clock (really, who travels with CDs these days?) when a cheap (and easier to figure out) model will do just fine. I’ll take a fewer-frills room any day to have the WiFi where and when I need it, for free.
Thanks Trisha for your comment. Thinking about it, you are of course right that there’s no need to increase room rates to provide free WiFi. It’s a fixed (and low) cost which hotels are paying anyway.
You also make a good point that you often need just an hour or two to check your email and just catch up (or it might be just ten minutes as it often depends on what awaits in your inbox!). The last thing you need is a hotel employee trying to sell you large fixed chunks of WiFi time “just in case” that you probably don’t even need.
As a hotelier, I absolutely agree. Our hotel has free wifi across property, for hotel guests, restaurant diners and groups in our meeting spaces. I wouldn’t have it nay other way.
But contrary to some of your statements, it’s hardly a selling point. People still book the hotel next door, which charges $15 a day for wifi, because their room rate is $10 a day less than ours. Maybe it’s just our market, but most travelers are concerned with advertised rate, and can’t look beyond that to what really matters.
Thanks for your interesting comment from a hotelier’s perspective.
I disagree with you that it isn’t a selling point. Maybe my sample of friends and acquaintances is disproportionately web-savvy, but “free WiFi” is often one of the first things people mention to me.
If you feel that offering free WiFi is not having enough of a business impact I’d suggest it should be marketed more prominently. I know I’d choose your hotel over its next door neighbour (all else being equal), providing I actually knew about the free WiFi.
One of the major chains needs to break away from the pack, gain a tactical advantage by making a big deal about its free WiFi and then force the others to follow.
The call for Free Wifi is poorly thought out, however the call for affordable or at a reasonable charge is probably more justified. It is a misheld belief that because Broadband only costs circa £15.00 per month for upto 8 meg in a residential/home location that this is what a hotel will be paying. This is totally incorrect, because of the demand in a hotel by multiple users who are all expecting to get the same or better than they get at home or in the work place, therfore the hotel operator has to purchase either multiple ADSL circuits and equipment to combine and mange them which can cost many thousands of pounds. or install a very large leased line which wil cost them a considerable amount circa £12000.00 per year.
There is also the problem of guests not being able to conect to systems in hotels and then expecting the hotel staff to be able to wave a magic wand and make, what is technically a very complex set of equipment , work with their laptop which may have many different security settings applied. They are not trained for this nor should they be expected to be IT technicians, and so the hotel has to pick up another cost by subscribing to a 24 hour help desk so that the guest can browse the Internet, download TV programs, Films or music.
We also have the situation where a venue that offers conference facilites will need to connect multiple laptops back to centralised servers all at the same time. This raises the need for extra provision on the broadband service which of course means more cost.
Finally our beloved EU has sent out a directive, which does have to be ratified by each member state, that records of the user and usage of public free or paid for Internet Hotspots must be kept for a minimum of 6 months or a maximum of 2 years. This was actullly made public in the press last week but it is still low key at present but believe me it will come into force soon.
This will mean that all the people who have or supply access to the internet will have to install a gateway or other equipment that actully asks the question or records the data automatically.
I ask you : if you are the owner of a property be it cafe, pub or hotel and have to invest a further £1000.00 plus a support agreement pls of course the cost of a telephone line and ADSL service will you be doing it for Free. I think not.
The main question is.
Do you get Broadband in your home Free of Charge? the answer will be NO so why should the hotel operator do it for free. Reasonable cost yes but Free no.
It’s good to get your perspective Paul as someone who understands the true cost and complexity of delivering WiFi.
However, I think your cost argument can apply to many aspects of a hotel’s operation e.g. heating, electricity, etc. I’d counter that WiFi is now seen on a par with a “utility” and so is not palatable as an “extra”.
Clearly, 7 out of the current top 10 London hotels on TripAdvisor can provide free WiFi and (presumably) remain profitable.
I also don’t think the home analogy is valid because as a hotel customer I’m already paying for the room: in London that could easily be hundreds of pounds a night. It may apply a bit to budget hotels but I’m not convinced.
In exchange for that room rate I have a set of basic expectations including a decent night’s sleep, hot water, electricity and light.
For me, WiFi also now enters that list of “essentials” though I appreciate that won’t currently be true for all. But I think eventually it will be, which is why I feel hotels should just take the hit and move on.
Thank you for taking the time to get involved in this debate. With certain hotels at the 4+star and 5 star level it may be possible for the hotel to include this cost in the rack rate but with the state of the market at present being pressured by people chasing rate, they cannot continue to absorb all the costs. We must also consider the continuing cost of providing this service. The demand for bandwidth has incresed in all of our customer hotels over the last 9 months by 300% and this is all mainly driven by the increasing number of free entertainment sites available to the user, which in many ways impacts on the revenue stream that was historically earned by the hotel from other services. If you look at the cost of the present installed entertainment packages and the lack of return from them and the cost of continually expanding the available bandwidth, it is not just the cost of providing internet that needs to be addressed in this case study. The cost of an entertainment package and a telephone system is probably fixed and some people may be in long term arrangments, especially if they had a view that these two items would provide a revenue stream. With broadband now not being infinite and the cost of even larger demands being borne by the hotelier, the whole cost is then compounded.
So in conclusion the actual cost of providing a usable service is made up as follows:
Capital cost of equipment to distribute access throughout hotel + Monthly cost of broadband and support + Monthly cost of delivery method ie analogue or leased line + Loss of revenue from other areas.
I would prefer to have free wi fi, but when they do charge for it, a problem arises when I bring my wife along. She wants to hook her computer up. Although I can use a router when it is wired in the hotel room…I am somewhat stuck when it is wireless. i am not paying 20 pounds a day for each computer! Inevitively, this results in a significant loss of revenue for the hotel as I end up booking elsewhere. One hotel in Houston is about to lose $700 plus over this very thing.
Great comment Bill, I would do exactly the same as you. To me this perfectly illustrates the folly of charging for WiFi: hotels only succeed in generating hassle for their guests and anger with this short-sighted policy, aside from losing business.
Actually I would be happy to pay for it, but at a realistic rate that’s competitive with Internet cafes. In Australia it’s common for hotels to charge $15 an hour for Internet access, when it can be had at an Internet cafe for $3 or $4 an hour. If a hotel charged $5 an hour, I’d be perfectly happy to pay it.
In their defence, hotels here often offer access for “$15 an hour, or $25 for 24 hours”. But who needs 24 hours of access? As a travel writer on assignment I only need probably about 2 or three hours in a 24 hour period. The inflexibility is irritating.
Also, it does cost hotels my business to some extent. When I travel I do select hotels that have free or cheap wifi. And if stuck in a hotel with expensive charges, I’ll leave the building to find a net cafe, or regular cafe with free access, nearby. Thus losing the hotel any revenue at all.
Compromise is the best approach.
I am both a salesman who travels quite a bit and the owner of a small inn. There is definitely real costs involved with providing ‘free’ WiFi. The fact that a substantial number of lodging properties offer it ‘free’ demonstrates the ability to absorb those real costs into their infrastructure. Like having a swimming pool, hotels realize that their guests appreciate free access and guests are happy whether they use it or not since it does not require extra expenditure.
But there is a big problem when bandwidth hogs who show up at a property and download movies, tv programs or other bandwidth heavy files. What happens to the service for everyone else at the property? It gets slow and cumbersome, resulting in disgruntled guests. Providing a limited amount of bandwidth in the property so that guests can check email or look up a few items online could be free but a $12-$15 charge for someone that uses a certain amount of bandwidth would be justifiable. A two step solution would make sense for the high end hotels who could provide their valued guests with more service by providing high quality bandwidth.
We all understand the difference between first and coach class when flying.
If you are going to yell at hotels about WiFi, please start on the airlines for charging for baggage. Charging for baggage results in a higher overall cost to fly for consumers and makes the overhead storage and the whole cabin that much more cram packed, resulting in more anguish while traveling. Everytime the flight attendants try to get me to leave my luggage at the gangway because they say they are out of room in the cabin, I want to explode. I wouldn’t have carried on if they weren’t charging and now that I have dragged my luggage all the way through security and to the plane myself, I am not turning it over to have to wait for them to unload when the flight arrives.
Hotels should pay attention because modelling after the airlines is a sure way to go bankrupt.
By the way, my small country inn offers free wifi.
Jason
The Barron Brook Inn
Jason, it’s great to have your comment as someone uniquely-placed to see this from both a hotelier and consumer perspective.
I hate airline baggage charges too, but at least they’re transparent i.e. I know I’m going to pay them before I buy my ticket online.
With WiFi charges there’s rarely any warning on the website before you reserve saying “do you realise that WiFi will cost $XX extra?”.
Of course hotels want to cover their costs but you answer the question eloquently when you say “my small country inn offers free wifi”.
If your little country inn can do it (and I really admire you for this) then why can’t the biggest brands in the hotel business?
They spend lots of money on advertising, marketing departments, piped music and other amenities that I don’t need or value, so why can’t they channel resources instead toward something as basic as WiFi?
The bandwidth issue is a relevant one and I have no problem if hotels have a “fair usage” policy and penalise guests in breach of the rules, as long as these are visibly and clearly stated.
Jason, has given an excellent analysis of the WiFi debate. Following on with the bandwidth issue. How would the “Fair usgae” policy work? How easy is it to set the free WiFi usage to a fixed data amount (downloaded + uploaded), so that when used up you would need to pay for extra data? So that instead of the timer you get with WiFi sold by time your data usage would be recorded. The major problem I see with this, is that some hotels would offer a meagre free data usage then charge huge amounts for the paid usage, but still be able to say they offer Free WiFi.
What do you believe would be a fair data usage per 24 hours?
As the editor of a European travel blog I’m a frequent traveller for whom a decent internet connection is an essential. I always check out if a hotel offers free wifi before booking there. I do appreciate that it takes a fair investment for a hotel to install and maintain quality wifi throughout their premises. However I believe that hotels that make this investment will benefit by an increase in the number of bookings and higher customer satisfaction leading to repeat bookings.
This is a really interesting discussion with many insights. I’m not a hotelier and therefore have no insights into the cost of providing free WiFi. In this sense, Paul’s comment above is informative.
As an outsider, I am puzzled that that many hotels (from hostels right up to 5* hotels), cafés, airports, etc.. around the world (particularly in Southeast Asia and South America) offer free wi-fi – the Argentinian city of Salta even has free city-wide wi-fi! – while in Europe and North America, we’re bickering about the cost of providing this service. In Europe & North America, free wi-fi is offered in cafés, and lower-end accommodation like hostels, budget hotels and inns so I find it odd that the larger hotels (where guests pay more) charge for it. If the small establishments can afford it, why not larger hotels? I’m often inclined to dismiss the cost argument and instead see it as a ‘treasured’ source of ancillary income, especially at hotels that charge exorbitant rates for internet access. It never fails to annoy me when I see hotels charging crazy rates for internet access. The hotel may be fab but the mental note has already been made in my mind never to stay there again.
I seriously believe that hotels have to see free wi-fi as an additional service, like fresh towels and sheets every day, or complimentary mineral water. People increasingly need access to the internet to stay in touch, or do their work. I feel that hotels that do offer free wi-fi should use this as a selling point. I already see many booking engines which provide users the option of blocking out all hotels which do not offer free wi-fi. With one click of the mouse, hotels with free wi-fi will be the only ones listed in the hotel search results.
That said, I like Jason’s compromise above, i.e. provide free wi-fi to those who only need to check their email, etc.. I would like to add my own suggestion: if it’s too costly to provide free wi-fi in the rooms, then provide it in a central location, like the hotel lounge or café where guests can comfortably sit and work, check emails, etc… while enjoying a cup of coffee or a drink with a snack. I’m sure the income from the drinks/snacks will more than cover the cost of providing free wi-fi. I’m sure that’s not too much to ask!
Keith
Many thanks to the hoteliers who have commented above and also to Keith and Karen for their constructive insights and solutions.
I know there are issues and costs to overcome before all hotels can offer free WiFi. But at the end of the day, it’s the ones that manage to resolve them and give consumers what they want that will “win”.
It’s ultimately a business decision for hotels: will you take the short-term hit and “go with the flow” or resist something that is going to happen anyway through demand and competition?
What a stupid write up. Go out and price what it costs to equip a 250 room hotel with wi-fi throught the property, pay for the monthly bandwidth and the support. Get a few people with a slingbox and Hulu running and guess what, you need yet anothr T-1 connection. There is nothing wrong with paying for something to use something. The cost has to be covered somehow, so raise the room rate for everyone? Guess they should raise it a little more and give free lattes too.
Hi VA, your comment is not especially constructive but I’ve published it anyway.
Of course there’s “nothing wrong in paying for something”, but did you read the article? My analogy used an espresso not a latte but the point remains: a coffee is discretionary spend whereas WiFi for most of us is not.
The cost of electricity and lifts has to be covered too, but do you charge your guests for that as well?
You will only be able to hide behind technicalities for so long because your competitors (including many budget hotels) are managing to get it done. It’s your job to go and figure this stuff out and not your guests’ problem.
If so many other hotels are smart enough to implement free WiFi AND absorb the cost AND stay competitive (including most of the hotels highest-rated on TripAdvisor), surely it can’t be that crazy an idea, can it?
Or do you think the many TripAdvisor guest reviews which complain about WiFi charges are “stupid” too?
VA, Have you read through all of the comments on here. Bandwidth is an issue, but it can be resolved fairly. Of course the room rate will need to be raised for everyone. Budget hotels chains in France offer free WiFi yet still charge less than €40 per night.
What about Keith’ s suggestion of of providing Free access in the Cafe / Lounge area?
If Free WiFi is important to guests then they will stay at establishments offering it.
Why not go all the way and offer laptops? Either as a rental or a room amenity?
Good point Jim: a couple of London hotels I know already do this. The Lanesborough for example offers free laptops and the City Inn Westminster has free computers in the room. You can read about both (and other free hotel amenities) in this blog post:
http://londonhotelsinsight.com/2010/06/04/the-best-london-hotel-%E2%80%9Cfreebies%E2%80%9D/