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Should hotels set wi-fi free?

Date
There's a free wi-fi signal in almost every cafe, so why do hotels insist you pay? Digital image: Jamie Brown

There's a free wi-fi signal in almost every cafe, so why do hotels insist you pay? Digital image: Jamie Brown

It's a sore point, and usually a controversial one, for every business traveller. You check into a five-star hotel where one night in a mid-range room can cost more than your weekly rent, only to be hit up for $20 or more for internet access.

Little wonder that Tourism Australia's campaign for free wi-fi in Aussie hotels has met with a thumbs-up from the corporate crowd.

Hotels see in-room internet as one of the last wellsprings of revenue 

And in an age when almost every backpacker hostel offers free wi-fi, it's commercial arrogance for a top-end hotel to slug guests extra to use the internet.

Why treat business travellers worse than backpackers? "Because we can get away with it" or "Because they can claim it back" is not the correct answer.

Ironically, the main argument hotels trot out against free internet access is that unlike a decade ago, today almost everybody is online.

And with so many travellers packing tablets, smartphones and low-cost laptops, hotels fear that almost every guest will use free wi-fi if it's offered.

Yet those are the very reasons why in-room internet should be free. It's about looking after your customers' needs, especially when there's so much great info about travel, local dining and nightlife online.

The cost of doing business

But how realistic is the call to set wi-fi free?

Somebody has to pay for the high-speed internet line into the hotel, the cabling through the building and the little wi-fi base stations on each floor, to ensure that fast internet flows wirelessly in every room.

In its 2012 Hotel Wi-Fi Report, industry website HotelChatter estimated the cost of wiring up a 250-room hotel at US$125,000 ($A121,950).

But even allowing an average cost to the traveller of $15 per day, this delivered a US$200,000 profit per year.

And hotels see in-room internet as one of the last wellsprings of revenue.

Phone calls, for which they can charge $1 just for dialling a number, and another chunk per minute you spend talking? Mobile phones, global roaming and local prepaid SIM cards put a a stop to that.

Pay-per-view movies? Armed with laptops and tablets, almost every traveller seems to have shifted to a BYO entertainment policy.

One way to sidestep the cost of hotel internet is to chase high status with the loyalty scheme of your chosen chain.

For example, top-tier Gold and Diamond members of Hilton Hhonors and platinum members of the Starwood SPG and Hyatt Gold Passport programs enjoy free internet, along with other perks such as complimentary room upgrades and late checkout.

(Note that if you're a high-status member of Virgin Australia's Velocity frequent flyer scheme you automatically get free Hilton Hhonors Gold or Diamond membership.)

Free vs fee

Some hotels are shifting towards a two-tier system for wi-fi.

There's a free connection that's sufficient for web browsing and email, and a higher-speed paid service for serious speed which can run solid web apps, connect to the office network ind watch online video.

Of course, there's a caveat with paid internet: it has to be worth paying for. And that's not always the case.

Last month I stayed at the Regal Airport Hotel during a short stopover in Hong Kong, where in-room internet cost A$15 per day but ran at a snail's pace of less than 1Mbps.

That's slower than even the worst home broadband connection and is virtually unusable for all but the most basic web browsing and email.

A call to the hotel's tech support line confirmed that 1Mbps was the top speed available for all guests – certainly not up to par with what a business traveller can and should expect.

One way to sidestep super-slow hotel connections is to pop a local prepaid 4G or 3G SIM card into your smartphone.

On this visit to Hong Kong, a colleague had fitted his iPhone 5 with a SmartOne 4G SIM card. For a mere HK$48 (A$6) upfront and HK$8 (A$1) per day for unlimited access, he could hit the Net at over 20Mbps.

With speeds that high and costs that low, why bother paying for in-room internet?

For the same reason, an increasing number of business travellers are relying on wireless broadband services – especially the new 4G networks of Telstra and Optus – within Australia.

Why pay $30 at the hotel for what's effectively a few hours of internet when just twice that can get you prepaid mobile broadband with 3GB that you can use anywhere and anytime?

What are your experiences with hotel wi-fi, and should it really be free?

David Flynn is a business travel expert and editor of Australian Business Traveller.

Twitter: @AusBT

41 comments so far

  • I travel internationally a lot for work and I hate coming home to the third world that is Australia. Its the only place I visit where I can't get wifi. It is embarrassing when international travellers to Australia realise they are essentially being price gouged.
    In a developing nation like Vietnam, the corner coffee shop has wifi and guess where I stay and have a few coffees, then maybe lunch. Gee even Singapore airport has free internet access. I did see Melbourne airport has a limited free wifi in the international departures the other day but it was so slow, no emails downloaded so I don't know if it actually works.

    Commenter
    agm
    Date and time
    March 06, 2013, 1:56PM
    • And getting more that way everyday , especially with education the way its set up.No wonder Keating made his anal references,the place really has gone to the pack, and they want to make the pack even larger.It will be the guillotine next.

      Commenter
      Lane
      Date and time
      March 06, 2013, 3:44PM
    • I agree and do the same.

      Internet connection included, preferences my choice of accommodation.

      Along with walking and transport distances.

      Commenter
      J. Fraser
      Location
      Queesland
      Date and time
      March 06, 2013, 5:08PM
    • Totally agree! I've travelled everywhere and every hotel I book, outside of Australia, has wifi available "for free" (which really means at no additional cost).

      It's not about how much it costs to instal and operate. Everything the hotel does costs money - that's why you pay to stay in the hotel! They should factor in the cost of providing wifi into the cost of the room. Charging an additional cost for wifi would be like being charged for electricity, or running water. I'm sure installing plumbing into every room is expensive as well, but it doesn't mean that we should be charged for taking a shower. Besides the fact that the infrastructure has to be there anyway even if you're offering it for a fee.

      Commenter
      T
      Date and time
      March 06, 2013, 5:40PM
    • Unfortunately hotel are on the drug and it will be a big hit to their revenue if they stop it, until business starts to fall because others are offerring free Wifi.
      I have no issue paying, but the price needs to be reasonable. $29 fo 24hrs, when a roaming plan is $30 per month! As I travel a lot it helped me to justify get a sim for my ipad and roaming for my laptop. It was so much cheaper than the hotel!

      Commenter
      Aussie Jim
      Date and time
      March 06, 2013, 6:15PM
  • Australian hotels could at least have free wifi in the hotel lobby, restaurant and bars. Some do, even cheaper hotels like the Ibis chain. I'm at the stage where I boycott hotels with absolutely no free wifi.

    Commenter
    rudy
    Date and time
    March 06, 2013, 2:11PM
    • YES. Yes, it should be free. I'm sorry, I have to pay $29.95 for 24hrs access when my room just cost me $360?? I'll just go downstairs, leave your hotel where I might sit in the bar all afternoon and spend money, and go to Starbucks downstairs, shall I?

      Commenter
      CityGirlmovedCountry
      Date and time
      March 06, 2013, 2:21PM
      • I agree with the two-speed approach. Give everybody a basic connection for free and offer a much better professional grade connection for an extra cost. As long as the 'free' service isn't deliberately crippled so as to be to slow that everybody has to upgrade to the paid service!

        The tip on using a smartphone when overseas is good, in some cases it's astounding that a smartphone can these days through 4G offer faster speeds than a hotel AND be cheaper too!

        Commenter
        Son of Ryan Bingham
        Location
        Sydney
        Date and time
        March 06, 2013, 2:29PM
        • $125k for wi-fi is rubbish. I've just fit out a 15 storey office building for 1000 users with similar wi-fi infrastructure for a quarter of that cost. $30k to setup something that last 10 years means a cost of about 3c per room per day. Even at $125k it's still only 13 cents a day per room.

          Commenter
          Nerd
          Date and time
          March 06, 2013, 2:38PM
          • That's assuming there are no ongoing costs from the Telco...

            Commenter
            Tim the Toolman
            Date and time
            March 06, 2013, 4:30PM

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