In-Room Phone: “Reports of my death have been greatly exaggerated”

In-Room Phone: “Reports of my death have been greatly exaggerated”

The Telephone: One of the very most useful of all inventions, but rendered almost worthless & a cold & deliberate theft & swindle by the black scoundrelism & selfishness of the companies of chartered robbers who conduct it.
 Mark Twain’s Notebooks & Journals, Volume 3, Notebook 30, August 1890-June 1891 (a)

 

For years people have been predicting the end of the in room phone, to Misquote Mark Twain “Reports of my death have been greatly exaggerated” reports that the in-room phone is dead and going away seem to be way exaggerated.

As has been reported many places

Annual revenue collected by U.S. hotels from phone calls dropped to an average of $178 per room in 2009 from $1,252 in 1999, a decline of 86 percent, according to Colliers PKF Hospitality Research. Meanwhile, income from in-room movies and games dropped to $126 per room from $171, a decline of 26 percent, according to the research firm.(1)

There is a good post by Rafat Ali over on Linkedin that explains why there is so little use of the in-room phone:

Another part is hotels brought it upon themselves, making the phone systems complex (dial 9 for outside line, anyone?), bleeding expensive ($3 for a local call, $ pray-it-isn’t-too-bad for a long distance, $ you’re-crazy-to-try-this for international calls) and unnecessary tinkering with consumer behavior (have you tried checking a voicemail on that phone ever?).

Even more crazy, hotels even now charge by the minute, or start charging after a certain number of rings even if ultimately the call didn’t go through.

As usage dropped, hotels stopped caring about the hotel phones too, as a source of revenue. It now costs more for hotels to maintain these phones than the revenue they get out of them. (2)

Technology also played a part of why these charges went up. As Michael Hraba explained back in 2009:

Hotels used to gouge consumers for phone calls because they had no choice, and it was a BRILLIANT revenue stream. Then came calling cards, and hotels started losing lots of revenue… and per our typical furrowed brow, it took us a couple years to figure out why. Even dial-up modems for AOL and prodigy services were a complexity to us… which is why we started charging people to call out to 800 numbers. Of course this garnered more distrust from guests about our call accounting, but it also got the enraged guest at the desk who had left AOL connected for 3 days and owed the hotel $5545 for a 2910 minute phone call to an 800 number.

By the time we admitted to ourselves that the revenue stream was lost and started charging enough simply to cover costs… hotel guests had already decided to never trust in-room phones ever again. Calling cards were used almost exclusively, and guests now have cell phones that simply makes in room telephones, for all extensive purposes… obsolete. This has been patently obvious in the last 5 years…. in-room phones are nothing more than an intercom now. (3)

Various new SmartPhone apps also claim to be hastening the end of the in-room phone:

Starting March 1 you can use your smartphone to request nearly every hotel service, at over 1,200  big brand name hotels, with a new app called MobileSuites. By big brands, we are talking Marriott, Starwood, Hyatt and Hilton. (4) [note that this is only available on iOS for now]

Now this article even goes on to discuss the new keyless door apps. But the comments here are quite telling:

Air Crews contractually have to receive a wake up call one hour before scheduled pick up. Air crew schedulers ( Pilots and Flight Attendants ) have to be able to reach their crews for schedule changes in their rooms, It won’t go away from large hotel chains.
In-room phone will have to stay for fire/safety reasons. It will never go away.

Other reasons why the in-room phone is here to stay are related to how hotels are rated. In many countries (like all of the EU) to get a rating of 3 or more stars you need to have an in-room phone.

But beyond all of that, there are ways to bring the customer back to using the in-room phone. Following Rafat’s logic the easiest way is to start by making the the price reasonable and easy to understand.

At Phonebnb this is what we aim to help hotels do, by offering reasonable priced flat-rate, unlimited calling from the in-room phone.  Please contact us if you are interested in learning more about a revenue share model that can help make the in-room phone a revenue stream again instead of an expense.

References:

a) Mark Twain Quotes: TELEPHONE (image and quote)

1) Hotel revenue from phone calls, in-room movies drying up

2) No One Will Ever Miss the Hotel Phone

3) The Story of the In-Room Phone, & the future of on property telephony

4) End of the hotel room phone?