Nick Price
HOTEL CONCEPTS, BRILLIANT USER MEETING
28 MARCH 2012, HOUTEN NL
agenda
 2000 – 2010 – Review
 2010 – 2020 – Opportunities
distribution
 in-room infotainment
 mobile
 cloud

2
incremental or dramatic change?
2000-2010
3
IP & internet
 application integration
at low cost
 internet as a product
 distribution
opportunity or threat?
 indispensable asset,
yet to be monetised
4
HSIA usage
HSIA Usage Rate / Occupied Rms
30%
25%
20%
15%
10%
5%
0%
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
source: Mandarin Oriental
5
HSIA device usage
HSIA device utilization / 1m room nights
10
8
6
4
2
2006
2007
2008
Wireless Devices
2009
2010
Wired Devices
source: Mandarin Oriental
6
internet distribution
trends in overall online travel market:
europe 1998 – 2008 .. 2009
70
Billion Euros p.a.
60
50
40
30
20
10
0
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Source: Carl H Marcussen, Centre for Regional and Tourism Research
7
internet distribution
trends in the european online travel market – by channel
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
0%
10%
Direct Sales
20%
30%
40%
Intermediaries
50%
60%
70%
80%
90%
100%
source: Carl H Marcussen, Centre for
Regional and Tourism Research
8
internet distribution
mo.com revenue growth: % total leisure room nights
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
2002
2004
2006
2008
2009
2010
source: Mandarin Oriental
9
tv infotainment
12%
Adult Take Rate
Hollywood Take Rate
10%
8%
6%
4%
2%
0%
source: Mandarin Oriental
10
telephony (the great tech FAIL)
US$
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
% Rev/Occupied Rm
700,000
600,000
500,000
400,000
300,000
200,000
100,000
source: Mandarin Oriental
11
DIY application development




few if any examples of success
most are now regarded as legacy applications
most are US-centric
none are positioned for global deployment
12
application software
Appication Suites
 rise and fall of application suites
 applications, lots of them
 what happened to ASP?
INV
Rev Mgt
Accounts
PMS
POS
S&C
Accounts
13
networks everywhere
Reservations
HVAC
Internet
TV
Phone
Rm
108
Audio
Front Desk
Door Lock
Lighting
Rm
178
Rm
118
Network
365 / 7 / 24
Rm
128
Rm
138
Rm
168
Rm
158
Rm
148
14
hotel global networks
BEIJING
HONG
KONG
Hotel
Data
Centre
GENEVA
PARIS
NEW
YORK
LAS
VEGAS
15
from under the stairs to a modern hotel
data center
16
on property skills gap
smart room
complexity
VOIP
IRES
skills gap
HSIA
CRES
# of technical staff
PMS
1995
1998
2001
2003
2004
2005
2006
2007
2008
2009
2010
year
17
challenges of data privacy & security
 never a consideration in the age of brass keys and CRT’s
 PCI born in 2004, same year as Facebook
18
green initiatives
19
asset-lite business models
20
international chain expansion
21
change is here
2010-2020
22
agenda
 2000 – 2010 – Review
 2010 – 2020 – Opportunities
distribution
 in-room infotainment
 cloud

23
distribution
24
How can I help?
25
Hotel
1990
CRS
Hotel
Hotel
Hotel
Hotel
CRS
Hotel
Hotel
customer
travel
agent
Hotel
GDS
Hotel
CRS
Hotel
Hotel
Hotel
Hotel
CRS
Hotel
Hotel
Hotel
26
Entertainment
Golf
F&B
Hotel
room
Transport
Meeting /
conference
poor representation of product to customer
poor representation of customer to hotel

GDS Green Screen

GDS PNR difficult to link to guest database

ADS selling unapproved inventory

reduced ability to cross/up sell

loss of price/rate integrity

contributes to low repeat guest ratio

customer information unavailable to 3rd parties
(travel agent/representation company)
27
2000’s
Hotel
brand.com
CRS
Hotel
Hotel
Hotel
Hotel
customer
GDS
CRS
Hotel
Hotel
Hotel
Hotel
OTA
CRS
Hotel
Hotel
Hotel
28
2000’s
Hotel
brand.com
CRS
Hotel
Hotel
Hotel
Hotel
customer
GDS
CRS
Hotel
Hotel
Hotel
Hotel
OTA
CRS
Hotel
Hotel
Hotel
29
30
distribution
 10 years fighting the wrong enemy
 enemies are not the OTA’s



Expedia
booking.com
Travelocity etc.
 (fr)enemies are:





Google
Microsoft
Facebook
Apple
Amazon
-
mapping and search excellence
global presence and cloud
800m users
30% iTunes commissions
Internet merchandising and pricing
31
32
33
34
2015
Facebook
800m+ users
customer
knowledge
$20 Billion +
$10 Billion
fulfilment
CRS
$50+Million
$50+ Million
$10 Billion
iTunes
AppStore
$20 Billion +
35
in-room infotainment
36
VoD utilisation 2006 - 2020
Content Utilization / Occupied Rooms 2006 - 2010
12%
Adult Take Rate
Hollywood Take Rate
10%
8%
6%
4%
2%
0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
37
leading hotel companies will build hotel
rooms without TV’s within 5 years
38
st
21 century in-room entertainment
)))
Wi-Fi
))
Stored
Content
On
Mobile
)))
))
)
)
st
21 century in-room entertainment
Wi-Fi
)))
)
Stored
Content
On
Mobile
)))
))
))
)
)
)))
))
NetFlix
Hulu
YouTube
 $100 minimum wage forces
labour efficiencies
EXCO: 8
Department Head: 20
Supervisor: 16
General Staff: 717
41
cloud
42
CAPEX
VS
OPEX
explosion of
technology
by 2015 75% of successful
hotel companies will have
migrated core systems
to “the cloud”
emerging
markets
opportunity
http://hospitalitytechnology.edgl.com/top-stories/Are-We-in-the-Cloud-Decade-66712
43
cloud rationale






global reach
velocity to new markets (asia/e-eu)
agility
capex -> opex
pci compliance / security
addresses property skills gap
44
application software
Appication Suites
 rise and fall of application suites
 applications, lots of them
 what happened to ASP?
INV
Rev Mgt
Accounts
PMS
POS
S&C
Accounts
45
cloud fragmentation danger
Réservations
Amazon
Phone
Sales
“ How do I integrate my
systems now? “
SalesForce
Catering
Door
Lock
HOTEL
HVAC
Google
RackSpace
Accounts
PMS
Azure
POS
46
WANTED TO BUY: cloud ecosystem
“ the battle of devices has now become a war of
ecosystems, where ecosystems include not only the
hardware and software of the device, but developers,
applications, ecommerce, advertising, search, social
applications, location-based services, unified
communications and many other things. Our
competitors aren’t taking our market share with
devices; they are taking our market share with an
entire ecosystem. This means we’re going to have to
decide how we either build, catalyse or join an
ecosystem “
Stephen Elop CEO Nokia (feb 04 2011)
47
Azure hospitality services ecosystem
PMS
SALES
ACCOUNTS
…………
hospitality services layer
payment
distribution
service bus
identity / SSO
hotel media
vault
access control
others
caching
geo-replication / CDN
north
USA
south
USA
north
EMEA
south
EMEA
south
east
ASIA
east
ASIA
48
 hotel companies are architecturally complex and need
quality solutions
 globally available
 365/7/24 availability
 hosted by trusted partners Microsoft / Google
 opex acquisition model
 Office 365 or Google Apps migration is a good first step
towards an ‘above property’ cloud future
49
thank you
Nick Price
 nickprice@netsystechnology.com