Are hotels ripping us off with a fee for Wi-Fi service?
Monday, May 05, 2014
After I suggested that hotels adopt a tier-pricing strategy for Wi-Fi service on MultiBriefs Exclusive last month, I heard two types of responses.
Some people agreed with me, and they have seen more hotels using a tier-pricing strategy for Wi-Fi. Others asked: Shouldn't all hotels offer free Wi-Fi service anyway because Wi-Fi has become a necessity for almost everyone? Isn't it just another fee that hotels add on to rip off customers?
It may seem hotels are trying to squeeze every last dollar from travelers with a fee for Wi-Fi service — this is certainly how we feel about the airline industry. Indeed, according to a recent report in The Wall Street Journal, the hotel industry collected $2.1 billion in fees last year, as compared to the $6.1 billion fees reported by the airline industry.
Many of those hotel fees come from parking and early check-ins, however. For example, Aria and Bellagio are now offering a guaranteed early check-in option for travelers with a fee of $20 or $30.
Considering the fact that many limited-service hotels have offered free Wi-Fi service already, I assume the Wi-Fi service fee collected by the upper-upscale hotels and luxury hotels would not add too much revenue to the lodging industry. But why can't upper-upscale or luxury hotels also offer free Wi-Fi service?
There are good reasons behind that. For example, travelers who choose to stay in upper-upscale or luxury hotels have different priorities than those with lower budgets. First of all, they are less sensitive to a $10 or a $20 fee for the Wi-Fi service since they have been paying $500 or more for a one-night stay in a luxury hotel.
More importantly, this group of travelers may also want to pay a premium price for a more secured network, a more stable connection and higher speed. Just imagine what kind of security network and service the president or the CEO demands from a hotel.
Because many upper-upscale and luxury hotels are striving to provide exceptional customer service or because they simply have to keep up with the brand standards, they have no choice but to invest in the best — and usually the most expensive — package available for premium Internet service. Therefore, they can charge a premium price for the service.
So, should hotels offer free Wi-Fi service? The answer really relies on whether we see it as an amenity or a necessity. As a consumer, I am glad I have a choice. There are many hotel brands with different options out there to meet my needs.
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