Hotels Get Phone Savvy

Once upon a time the in-room telephone offered a modest revenue source, but today the high-priced, standard hotel phone service doesn't add a dime to the bottom line, thanks to the personal cellular phone. However, that hasn't stopped manufacturers from making sleek, savvy new phone technology that, one day, might just make the phone profitable again. Hoteliers agree that the in-room telephone is not only necessary but is fast becoming the entertainment control center for the guestroom. Technologies such as IP telephony, voice over Internet protocol (VoIP), video telephones, converged networks, and on-phone advertising opportunities have changed the original use of in-room phones, giving them new meaning.

What New Phones Can Do
In-room phones are now a more interactive part of providing hotel information to guests while offering another way to control in-room devices like lights, draperies and televisions, says hospitality and real estate consultant Mark Munger. As a consultant working with several hotels, Munger has installed a range of products from Cisco (www.cisco.com) to Nortel (www.nortel.com). In 2006, he installed the latest Cisco two-line touch screen VoIP telephone and IP TV linked with the thermostats and minibars at Hotel 1000 (www.hotel1000seattle.com) in Seattle.

"As all these devices become connected, the ability to manage them to provide service increases. As we provide the guest access and control via their choice of devices, the phone display will be one available portal to service the guest," explains Munger, who also installed IP phones at the InterContinental Boston.

Current in-room phone features that are in use include room service menus with pictures, spa offerings, customized group information such as attendee status, wake-up calls, real-time meeting room location and announcements, valet requests, and reward membership information, points out Munger.

The most advanced location that Munger has worked with to date is The Liberty Hotel in Boston (www.libertyhotel.com), where he installed VoIP telephones offering touch-screen hotel services, including a virtual gift shop. The virtual gift shop is displayed on the screen of the phone and snapshots of every item available can be viewed. Guests find the virtual gift shops more convenient because they can shop for items in the privacy of their suite and the bellman delivers purchased items. Hotels, on the other hand, find that the virtual gift shop is more profitable because the hotel can save the money that would have been used to build the store; plus a virtual gift shop allows the hotel to showcase a larger array of items than what they could display in a physical store. All the data is based on the network and can be accessed not only via the phone, but also through the TV or on a guest's laptop.

The Teledex iPhones (www.teledex.com) also offer a multitude of ways for a property to save money through process automation. For example, a guest that pre-orders breakfast saves the hotel money and time. In the manual method, a guest fills out a card that displays the various breakfast options and hangs the card outside their door. Hotel staff must manually collect the cards and enter the orders into their food tracking system.

When this process is moved to the phone, three things happen: 1) You don't need to spend money to print and reprint those pre-order cards; 2) You don't have to pay an employee to go around and collect them; and 3) You don't have to manually enter the orders into the PMS to allow for proper folio billing. It all happens automatically. Plus, the hotel can increase the take-rate for this profit center by automatically asking for the guest's order on the phone screen once they set their wakeup call.

John Edwards, director of IT/North America for Millennium Hotels and Resorts (www.millenniumhotels.com), says he's shifted his focus to IP telephony and the advantages that could come from this technology. "We want to try to start leveraging this technology to provide a more personalized experience in the guest room," explains Edwards. "We are also looking at SIP-enabled [session initiation protocol] cordless phones with multiple handsets. This will be a big advantage when reviewing the total cost of a new phone system installation. With no revenue from in-room phones, any new telephony equipment is much harder to justify."

Profit Factor
The reality is that many guests, tech-savvy or not, like to get into bed and call their loved ones to say goodnight; therefore the in-room phone is a necessity whether it makes money or not. Yet, Edwards points out, "Looking at the way we have traditionally handled in-room phones we should stop trying to make it a revenue center. If we can start to provide services through the phones that guests need, then there is a possibility things could turn around. A lot will depend on the solution and how valuable it is to our guests."

Munger agrees that these services will need to provide something that the guest values and is willing to consume and pay for again and again. "This could be soliciting restaurant, spa or golf reservations via a phone display, or advertising special offers on the phone when a particular service like the bar or spa is not busy," he says. There is also the possibility, he adds, for some integration between the guest's mobile device, profile information, and the in-room phone such that the in-room phone becomes more attractive to use. A telephone with a rich interactive display in the room allows a hotel to increase the take-rates of practically anything they have to sell or promote. It's a great way to move unsold inventory of virtually any type, from unsold seats to a show in Las Vegas, to unsold tee times or spa treatments at a resort; the list of things that can be promoted via the phone is virtually endless.

Future Phoning
The future will bring an in-room phone that's able to communicate with the guest's mobile device. If a guest could initiate a call on an in-room quality handset with full duplex speakerphone with their mobile device, that would be a reason for the guest to use the in-room phone, says Munger. "The in-room phone might even receive the calls that are made to the guest's mobile device. Integration with guests' personal services like Skype or Vonage is already being discussed and demonstrated."

For example, in Japan, RFID capabilities built into the cell phone SIM card enable a guest to check-in simply by walking past the lobby threshold and can even turn their cell phones into their room keys. It also might allow technologies such as fixed-mobile convergence, by blending their cell phone and the in-room phone services with real-time location tracking for housekeeping carts, video surveillance based on activity in certain areas, and other key features.

Edwards says even with this technology, however, he feels we are still behind the curve. "There is a lot of discussion about new features in guest room phones that might drive people to use the in-room phone again. This might be possible, but my concern is that we are reacting too slowly. If we are going to take advantage of technologies such as VoIP we need to come up with solutions today. Someone needs to deliver a new solution that guests will start to rely on and that hotels can easily and affordably implement.  We run the risk of creating a cycle where we are always a little late in delivery and therefore never truly reap the rewards."

Nevertheless, the in-room phone must remain a fixture in any hotel that wishes to offer at least standard accommodations, says Munger. "It is right that a hotel has a lumpy bed and shower head that trickles water when turned on? What 'standard' did the hotel promise to me or advertise to me to get me to stay there, and was a phone in the room part of that standard? A communication device in the room is required. Let not the phones go passively into the night."