The Benefits Of A Tiered Internet Pricing Model
Tiered Internet pricing models allow hotels to offer their guests the convenience of free Internet access, while making faster speeds available to those guests that need it. Bandwidth is a commodity that is both limited in quantity and consumed quickly. Many hotels have come to the realization that they cannot meet all of their guests bandwidth needs by simply offering free unlimited Internet access to them. Many guests need more bandwidth to conduct business and are willing to pay more for the convenience. According to an article in USA Today, Marriott International and Carlson Hotels already have some hotels that use a tiered Internet pricing model. The Wyndham group, which currently offers free Internet access at most of their hotels, is one of the many companies that are evaluating the possibility of switching to a hybrid or tiered Internet pricing model.
Why Switch To A Tiered Internet Pricing Model?
Many hotel guests may be satisfied with the moderate bandwidth available to check their emails and post updates to social media sites. However, some business travelers often have much higher bandwidth needs. They may need to send large file attachments, connect to a VPN, or conduct a videoconference. These applications require significant bandwidth, but hotels may find it difficult to provide that much bandwidth to all of their guests. It may be too expensive to add additional bandwidth to accommodate the bandwidth demands of business guests, and all of the other guests’ mobile devices when the hotel must pay all of the expenses out-of-pocket.
Hotels and other businesses that currently offer free WiFi to their customers have the opportunity to increase their revenues by switching from completely free Internet service to a more flexible tiered Internet pricing model.
HotelChatter, a Web site that follows the hotel industry, found in its latest annual WiFi report that although more hotels were offering free or tiered pricing, the ones that did impose a fee charged $13.95 a day. The report estimates that the cost to provide Internet service for a 250-room hotel ranges from $2.50 to $4.50 per room, per month…. Read more at Free WiFi, but Speed Costs – New York Times.
HotelChatter calculated the average yearly revenue at $200,000 for hotels in this price range. Moving forward with a tiered Internet pricing model seems like an easy decision. Better service for guests and increased revenue are solid reasons to switch to a tiered Internet pricing model. Unfortunately, HotelChatter’s own website is very critical of these pricing tiers. Like any service that does not deliver on its promises, it is important that hotels that switch from free Internet access give their paying guests a superior experience.
Guests who pay for additional bandwidth expect noticeably faster speeds and for the hotel to address any in-room WiFi issues efficiently and effectively. Providing guests with access to a help desk is one way to guarantee that guests will have any WiFi issues resolved quickly. Deep Blue Communications, one of the earliest providers of tiered Internet pricing, also offers 24/7 guest help desk services. Their support staff can assist guests with connectivity issues and resolve many issues without the involvement of hotel staff.