Plasma or LCD?

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Plasma or LCD?

By Bradley Schmidt • Assistant Editor - 03/01/2007

Flat panel television technology has been a growing aspect of the hotel space for a few years, now that technological improvements and consumer demand have led to better product at prices that afford implementation on a chain-wide basis.

"It's a new technology and people are trying to jump on. They provide guests with a higher level of satisfaction than a typical CRT [cathode ray tube] television," says Richard Barter corporate director of strategic sourcing for Hilton.

The real indicator of the progression of this trend is that hotel chains are not just making the decision to implement flat screen technology in select locations or limited areas of a hotel, but phasing out CRT television use altogether, and not considering them when building new locations.

"We're very inexperienced in this area, but our hotel is very old, 115 years. It needed a renovation badly, so when we decided to do it, we wanted to do everything," says Shakeel Siddiqui, general manager of the Congress Plaza Hotel in Chicago.

"On our last three new hotel projects we really felt that rather than spending around $300 dollars per set on older CRTs that we'd probably be replacing in the next two to three years anyway, it would be money better spent getting something in place that would have a bit of a Ã.Ã.•¬Ã‹å"wow' factor and help build some differentiation from our competition," says Steve Dettman, director of business information systems for Raymond Management Co., a Wisconsin-based developer. "Certainly going forward I can't imagine any properties buying any CRTs." Raymond Management went with 32-inch LG ( ) televisions.

In fact, the biggest debate seems to center on what type of flat screen television will best serve the interests of the industry in the long term. So then, the question is: plasma or LCD?

The basics
The identical, thin, flat screen design of liquid crystal display (LCD) and plasma screen televisions belies the wholly different inner workings of each technology. LCD televisions operate by applying electrical charges through layers of liquid crystal compressed into a space between two plates of glass. Plasma televisions utilize a gas composed of plasma cells that, like the liquid crystal layers, are manipulated by electrical charge. Both formats in their infancy had noticeable drawbacks that remain associated with each to this day, whether warranted or not.

LCDs are often faulted for poor picture quality at side viewing angles, blurred images during fast motion, and poor color quality compared to that of plasma screens. Plasmas are often derided for poorer comparative resolution, being heavier and less energy efficient, having shorter life spans than LCDs, and suffering from image burn-in.

However, technological advancements have increased the performance of these devices to a level where the benefits of their use now outweigh the cost of those problems, which previously had been a major barrier to large scale implementation.

The choice
Even more important than the increased quality of flat screen televisions is the drop in price of the machines.

"We're all lead by the larger hotel companies, hands down," says Douglas Brookman, general manager of the Lucerne Hotel in New York. "In the beginning the larger chains did it, but the smaller chains didn't because it was cost prohibitive. Eventually the technology got better, became less expensive, and we did it because the customers were expecting it."

Today, a 32-inch flat screen television retails for anywhere between $600 and $1,600 depending on the manufacturer, whereas that figure would have been double or more a few years ago. And while it is still an expensive undertaking for a hotel to make the switch to flat screens, it is well within the realm of possibility and is increasingly looked upon as the cost of doing business.

"The old TVs were great and they served a fantastic purpose," says Brookman. "But unfortunately one of the things about being in the hotel industry is that you do need to think about being competitive from a technology standpoint.  People expect flat screens in their rooms."

So the answer to the question -- LCD or plasma -- is a bit of a mixed bag, although the industry is leaning in favor of LCDs. "The trend is much more toward the LCD for a number of reasons. Price, clarity, perceived longevity, and weight among other things" says Barter.

"The information that I got from my research is that plasmas have a tendency to have some problems over time. The gas can dissipate and the quality of the picture can fade," says Brookman. "For a hotel that is spending a lot of money on TVs, they're not looking to change TVs yearly. They're looking to change them years from now. The latest and greatest may come out tomorrow, but I'm still okay with an LCD."

Below 50 inches, LCDs have reached price levels equal to or lower than similar sized plasmas, and because the typical guest room will not likely feature a television set of that size, hotels routinely choose the lower priced of the two formats.

A look at Idaho-based Sun Valley Resort's conversion to flat screen televisions demonstrates this quite clearly. From 2003-2004, Sun Valley installed 280 Panasonic plasma televisions, but switched to LCDs this past year, installing 175 LCD models from both Panasonic ( ) and LG.

"We originally chose plasma because we felt the picture was better," says Dick Andersen, director of hotels for Sun Valley. "We later chose some LCDs for cost reasons."

However, the plasma market is far from dead.

"The cost differentiation between LCD and plasma leads you to plasma once you get to 50 inches and larger screen sizes," says Dettman.

Because they remain cheaper at larger sizes, plasmas are the choice for hotel bars, lobbies, meeting areas, and suites. Despite the recent switch to LCDs, Sun Valley still uses plasmas in all bars on the resort, as does the Congress Plaza.

"We have a high definition 52-inch plasma screen, in addition to two smaller ones, in our bar," says Siddiqui.

Typically hotels will install a combination of LCDs and plasmas, as is the case with the Arizona Biltmore which is currently completing a $1.8 million renovation that features 42-inch Philips ( ) plasmas in the living room and suites, and 37-inch Philips LCDs in all other guest rooms.

High-def content
What will truly shape the flat screen television landscape, and determine the eventual winner of the plasma-LCD debate, is high-definition (HD) content. As video entertainment companies release more content in full 1080p resolution, the format which can display that content the best, and balance that with good pricing, will win out.

"The big trend this year is the full HD standard and it has been proven that plasma technology is too expensive to make screens with that resolution," Daniel Kim, Hong Kong-based technology analyst at Merrill Lynch tells

Their higher resolution capabilities give LCDs an edge over plasmas in terms of picture quality, which when combined with leveling price differences, makes LCD models a logical choice. However, as previously stated, larger screen size still favors plasma screens and will do so until the price discrepancy becomes more reasonable.

While a format of choice is emerging, delivery of actual HD content to the television sets poses a unique problem for the hotel industry.

"Right now there's just not a good way to deliver HD content," says Dettman. "You can usually get your four major broadcast HD channels -- ABC, NBC, CBS, and Fox -- with no extra equipment, but ESPN, HBO, the Discovery Channel, etc., are often encrypted by the cable companies and you have no means of decrypting the signal even if you have an HD set. One solution is to utilize a cable-company-provided converter box, but we can't just put 186 converter boxes in a hotel and hand our guests remotes from the neighborhood cable company."
In order to deal with this, Raymond Management had to develop a system in-house that would allow them to decrypt HD signal at their properties.

"In Boise, [Idaho,] we're having all channel lines delivered via fiber, essentially building our own node which can transfer all of these HD channels to our property," Dettman explains. "This is something that is not easily replicated, unless you are lucky enough to be sitting on top of a fiber loop, as the costs to build out a fiber node at most properties would be prohibitive."

The Congress Plaza Hotel takes a different approach, focusing on in-room movies rather than creating an entire decryption system.

"Our pay-per-view movie system provider suggested we go with HD," says Siddiqui. By utilizing the services of nSTREAMS ( ), guests of the hotel get access to movies delivered in HD and the Congress Plaza saves itself the trouble of creating a decryption system.

"And we still get the free HD channels," adds Siddiqui.

Dettman, however, feels that gaining access to premium HD channels is a key to future success for hoteliers, and is actively working to duplicate the success of their Boise property in other locations.

"The ability to receive ESPN in HD was a real driver for our decision," says Dettman. "Business travelers want to be able to watch Monday Night Football."

All challenges aside, Siddiqui echoes Dettman's sentiments.

"Within the next several years, I think almost all of the hotels will have it," he says. "A high-definition revolution is coming through."