How the Age of Tweaking Impacts Hotel Operations

One of the better articles I read among the avalanche of tributes and rebukes after Steve Job’s passing was Malcolm Gladwell's "The Tweaker" in the New Yorker (free access). In essence, Gladwell distilled Job’s talent as that of being a master tweaker, who was compelled to make what already existed better, such as the ordinary digital music player which became the superior iPod, or a chunky Microsoft tablet PC, which Jobs tweaked into the sleek iPad.

But what was actually more interesting to me in this article was how Gladwell spelled out the clear distinction between inventor and tweaker. It’s not rocket science, but reading it I realized that we indeed live in the Age of Tweaking, rather than in the Age of Invention.

I took this concept to a recent conference here in Hong Kong, The World Research Summit for Tourism, where I was, sadly, the lone industry speaker among 300 or so academics from all over the world. The gist of my presentation was that in the Age of Tweaking, the underlying technology becomes more important than ever.

The above diagram shows how media platforms and innovation have evolved over the past 120 years or so. What you can see clearly here is that the media landscape has changed more in the past 5 years than it had the 100 years before that. And as we were heading towards the end of the 20^th century, content increasingly started to migrate across different media networks and platforms, including the TV mobile, web or even games platforms. So why is that? It’s because we have moved from the Age of Invention, to the Age of Tweaking. The TV was an invention, but the connected TV is a monumental tweak of the underlying invention.

When you look at how long it took for entertainment devices to gain a market share of 50 million, you’ll get a picture like this:

What’s striking is that from the point the internet went mainstream, the tweaking of communication accelerated and adoption of new applications climbed to unprecedented levels, as witnessed by Facebook and Twitter’s subscriber explosion. It’s clear that the internet created an environment of building blocks that gave new meaning to Product Life Cycle 101: Tweaking, which builds on something that is already familiar, makes adoption much easier than something that is invented from scratch and has to be heavily marketed to build familiarity and adoption.

So in other words: the more you tweak, the quicker the adoption and faster commercial gains.

Looking at some of the recent inventions that did not get off the ground underlines this. Time Magazine a while ago published a list of the worst inventions of all times, which contains some poignant examples of how invention can fail despite a brilliant and complex technology.  The Segway people mover is a classic example. I wonder if it failed because, as a new invention, it was too much of a stretch for people to learn how to use it. Who knows if we might see the technology emerge in another form, sometime in the future, with a bit of creative tweaking. 

Let’s look at what actually happened when the internet entered the mainstream. I’m not talking about being able to Google something or send emails. I am talking about Internet Protocol as a delivery technology. IP has touched all industries and walks of life because of its more adaptive attributes, lower networking, equipment and administration costs, centralized network control and management and better communications capabilities, productivity and flexibility. These advantages are particularly important for a hotel operation that has to handle many different technologies efficiently, including energy, security and communication.

In fact, IP is probably the king of tweakable technologies, because of its flexibility and capability which is why it will remain the key enabler of technology delivery for the foreseeable future. The important part here is that the underlying technology platform comes first, applications second. If you have a powerful enough technology platform that can be tweaked to accommodate future needs, you will be able to accommodate the next wave of tweaked applications as they enter the mainstream. Don’t forget, predictions put the number of connected devices in the market in the coming years in the trillions and China alone will have nearly 5 billion connected devices by 2020.

So as time to market for technology innovation continues to contract dramatically, hotels more than ever have to be flexible. But innovation is set to be facilitated by tweaking rather than inventing, so it’s important to focus on the underlying technology that will support tweaked technologies. With IP, we have a very robust technology now, and hoteliers should focus on the knowledge and technology available today to lay the foundations for the future. A robust technology will enable adding new applications in the future without major investment and with short time frames.

Technology firms on ‘litigious rampage’ stifle consumer choice

After Apple filed 10 lawsuits in a variety of countries against Google, claiming patent infringement, it seems Facebook’s launch of a mobile web platform this week, which is a direct challenge to Apple’s (and others’) control of their ecosystem, may ring in another round of what some fellow bloggers call the company's "lawsuit rampage".

Of course you can argue that Apple just puts upon everyone else what has and is being put on them by others. A simple online search reveals the multitude of suits and countersuits, class actions, trademark infringements and even libel disputes the company has had to fend off over the years by anyone from the Beatles and patent trolls to consumers, resellers and, of course, competitors large and small.
 

While Apple seems to be the most active and gets most of the publicity lately, other tech firms are not slow to unleash lawsuits on anyone, particularly if it throws a spanner in the works of its competitors’ operations. Think about Oracle’s patent infringement lawsuit against Google over Java last year, or the 2009 action Skype’s ousted founders brought against eBay over key P2P technology that was not part of eBay’s purchase of the VoIP provider in 2005.

Technology as an industry is heavily dependent on innovation and in an increasingly saturated world even the smallest new feature can potentially mean a big difference on the balance sheet. It is understandable therefore that technology companies are concerned with protecting their assets. But I wonder if rather than spending time and money sparring – often in vain – with their peers, companies should concentrate more on delivering the products and services that attracted consumers to them in the first place.

One of the reasons tech companies increasingly choose a legal option may lie in the confusion between patents, which can include proprietary rights, and copyrights, which can’t, leaving a lot of room for interpretation. In addition, with business interests now firmly being played out on a global scale, different countries, court systems and their respective interpretations of law further muddy the waters.

Tech companies are of course not the only ones finding themselves facing a court room over copyright issues. The slipperiness of its definition was recently demonstrated when Australian band Men at Work lost a law suit that alleged their 1981 world smash hit “Down Under” ripped the signature flute riff off a popular ditty written in the 1930s. While as far as I am concerned the flute riff is as close to “Kookaburra” as Doris Day is to Rihanna, the courts had a different opinion and the band now has to hand over 5% of profits from the 1981 song to the publishers of the 1930s song.

Back in the tech world, one of the more interesting copyright decisions the courts have handed down over the years is actually Apple vs Microsoft concerning certain GUI elements. Apple lost on the grounds that the GUI elements were either unoriginal to Apple, or were the ”only possible way of expressing a particular idea”.

This bears certainly similarities to Apple’s current court clash with Samsung over the latter’s Galaxy tablet, which Apple says looks identical to its iPad. But Apple is not the inventor of the tablet computer and a touch tablet has to have a rather large screen as much as a car has to have a motor. And here’s the crux: It’s the difference in horse power under the hood, quality of materials used and varying ranges of gadgets available that not only make a car, but every technical device unique and recognisable. Apple so far has been exceptionally successful in transforming itself from an equipment manufacturer to a true entertainment company that owns almost its entire ecosystem. This, not sleek design or form factor, is first and foremost the reason why the company is such a trail blazer and the envy of every telco and equipment manufacturer that keeps struggling to move up the value chain.

Technology may be a vastly complex field when it comes to copyright and intellectual property issues. However as the users of the technology that’s being fought over just now, we have to ask ourselves what is in our best interest. As the saying goes, consumers win with competition and lose when competition is stifled, which is what these lawsuits essentially are aimed at.
 
Looking at how many suits got retracted or thrown out over the years on the grounds of being baseless, litigious companies’ actions increasingly look like vengeful tantrum throwing rather than serious attempts at minimizing purported commercial damage that is based on provable offences. As the creator of the Java technology Oracle and Google fought over last year put it so succinctly, these types of lawsuits are all about ego, money and power.

He’s got a point. With success rates for these types of lawsuits checkered, it is questionable whether the vast legal fees generated by them warrant the outcome. So when excessive lawsuits bog down the courts and new products are being kept away from consumers during lengthy appeals processes, the only winners – no surprises here - seem to be the lawyers.

What has all this to do with hospitality? Well, plenty. In a world where there is a chance that a particular technology, feature or piece of hardware may no longer be available and thus no longer supported poses a risk to providers and consumers alike. It underscores the importance of a flexible approach when deploying technology. Think about the anxiety Google’s purchase of Motorola Mobility continues to cause handset manufacturers that use Android as their O/S. Despite Google pledging its commitment to its handset manufacturing partners, I am sure some of them are looking at a plan B should Google claim the monopoly on Android for itself.

So designing your system as open as possible will go a long way to safeguard your technology platform against not only litigious companies and their well paid lawyers, but also against unexpected shifts in technology trends.

How Hotels can Replace Dwindling VoD Revenues

Using smart in-room technology to increase revPAR post VoD

I don’t think anyone would disagree with the statement that new technologies, when used creatively more often than not maximise revenue-generating opportunities for hotels. It’s a logical expectation and a simple premise, yet so seemingly hard to put into practice.

The first time hotels felt the pinch of diminished returns from technology investments was when the meteoric rise of mobile telephony dented IDD revenues in the 90’s. Fast forward to today and the new culprit – no surprises here – is the Internet and its wider ecosystem. Since the Internet started to morph from information to entertainment medium a few years ago, it has created a vortex that draws in and transforms almost anything associated with everyday life. Think about how consumer technology devices evolve and multiply with enormous speed while doubling processing power with each new release, making consumer preferences, such as interactivity, on demand and control, ever easier to fulfil. The content delivery world has responded to this pull by transforming itself towards an on demand, interactive and, most importantly, online delivery service.

How should hoteliers react to these developments? Some hotel managers I have spoken to have seen VoD returns falling so sharply that even switching off the entertainment system for a day or two to test its popularity resulted in zero complaints. That’s some hard evidence that cannot be ignored when it comes to deciding on future IT investments. However, these hoteliers have also been busy thinking about other services they could introduce in an effort to entice their guests to spend money while they are in their rooms to replace the VoD revenues of old.

There are a number of options hotels have to intelligently use technology to replace this erstwhile lucrative revenues stream. For hotels, competition drives the need to differentiate, so the key is to opt out of simply adding easily replicable technology gadgets that may add to guest experience but don’t actually contribute to revPAR. Technology is at the heart of a lot of value added, revPAR generating services but for them to succeed, aside from being relevant for a hotel’s specific clientele, they have to fulfil three essential conditions: they need to be convenient to access, easy to use and, from the hoteliers’ perspective, have to add to the bottom line.

Let me give you two examples. Firstly, room service. The usual in-room dining menu may be printed on high quality paper embossed with golden scripture, but what it doesn’t show, is a picture of what you will be served. Now you may argue that you don’t get a menu with images in a five star restaurant either but that misses the point entirely. When I go to a five star restaurant I have usually made up my mind that I want to eat there. I may have researched the menu online, and if I have any specific questions regarding the menu my waiter will hopefully be obliged to be of assistance. On the other hand, when I look at the food menu in my room I am far from having made up my mind of where to eat, particularly if I have a myriad of choices right outside my hotel. So in other words, giving guests a bland in-room dining menu is a missed opportunity.

I often tell the story of when I travelled to the Middle East for the first time and was confronted with an in-room dining menu that listed, among other items, Foul Medames. Now if you are new to the country and culture you probably neither know what it is nor would you be too enticed by the name of the dish. Even the printed English translation, “Stewed Broad Beans”, may not sway you. But if you have the chance to study an image, or even a video of the chef preparing it on your in-room entertainment system, you may get an idea of how delicious this specialty actually is and it may just convince you to place your order - even more so if you can order the dish directly via your TV screen without having to pick up the phone and deal with staff who may not speak your language very well.

The other revenue opportunity that is attracting the attention of hoteliers is using technology to provide a vehicle for in-room shopping. Shopping on the in-room entertainment system is an entertainment option that taps into travellers’ predisposition towards opportunity buying. Many hotels have a shopping annex or Duty Free emporium attached to their premises. This makes it comparatively easy to aggregate appropriate content for an in-room, on-screen shopping catalogue, combined with a simple fulfilment processes that would suit even the shortest of short stay travellers. The limitations of the remote control as a navigation tool can be overcome by turning either a hotel-provided, or the guest’s own tablet or smartphone into a touch-based selection tool. Having all transactions linked with the hotel’s PMS system enables timely delivery and convenient payment options upon check out.

There are many more examples of how this type of online interactivity adds to revPAR, from direct booking of hotel restaurants and facilities, to local maps where local businesses in the vicinity can advertise their trade. Provided hotels are using a capable IPTV system, the technology is certainly mature enough to so the key is for hoteliers to get creative and find the type of service that suits their hotel’s and their guests’ identity and requirements.     

The Problem with Predicting Future Technologies for Hotels

While science fiction movies routinely deliver the inspiration for technology innovation, it's what they don't predict that's really interesting

Being able to peek into what the future will bring has been at the forefront of human desire for as long as we have existed. It’s the basic foundation from religion (heaven and hell come to mind) through Nostradamus and right down to the more recent fascination with all things futuristic, that probably started when H.G. Wells published his novel “The Time Machine” in the dying days of the 19^th century. A few years back, the science fiction movie everyone loved to quote in our industry was Steven Spielberg’s Minority Report, released in 2002, which was a marketer’s dream for its depiction of a world in which advertising is so tailored, targeted and ubiquitous that it merges seamlessly into everyday life, to do its work of subtle (or not so subtle) persuasion. It seemed all so very plausible and within grasp then, not least because digital signage technology had just made an entrance into the advertising world in a major way.

Fast forward nearly 10 years and we haven’t really moved on that much. According to film lore, Spielberg consulted numerous scientists in the lead up to the film in an attempt to present a more plausible future world for the year 2054 than usually imagined in science fiction films and many articles have been written over the years about how many of the film’s imagined technologies have become reality. But let’s not get too carried away. Yes, companies have invented a lot of things that make an appearance in the movie, such as electronic paper, facial recognition advertising billboards and 3D televisions, and some were most probably even inspired by the movie to do so.

The thing is though, that precious few of these inventions have entered the main stream (3D TVs being the exception), not even facial recognition technology, which has been hailed as the holy grail by digital signage providers for years now. But then you can reasonably argue that with the movie set in 2054, we haven’t done so bad after all, given that we have another 40 odd years to make all the other technologies mainstream.

However, far more interesting than what science fiction movies from the Jetsons to Star Wars and yes, Minority Report, did predict, is what they did not predict: the Internet, for one. Or Facebook  Or Twitter, in fact the whole social networking phenomenon. These technology-driven trends have, and continue to shape our lives at almost every point like no other and yet every single look into the crystal ball has missed mentioning them.

So it was with some trepidation that I consumed the recent predictions of what the hotel room in the year 2030 will look like by Ian Paterson in the study “Travelodge Future of Sleep”.

There are a lot of technologies in there that sound great and believable, being connected in our own virtual reality through a visor or contact lenses and interactive video panels are two that instantly come to mind. This and other useful innovations I can actually imagine making my hotel stay more pleasant, but others seem more appropriate as home applications, rather than additions to the guest experience in a hotel. For example the “Dietary advice from night time monitoring”, which may be a great help when I’m at home and in my weekly routine, but the last thing I want when I wake up in a hotel room is a reminder of the banquet meal, pub crawl and karaoke marathon with my customer the night before. Not the least because it will probably require something a lot stronger than is on offer on the breakfast menu to get me back on my feet.

I am also slightly puzzled by the various home-upload features, particularly the 3D room re-skin home away from home upload, where lonely business travelers will be able to choose from a range of layouts including ‘virtual family’. The incredibly sad image this produces in my imagination aside, unless I suffer from pathological homesickness I think I’d rather not have that appearing on my hotel bill.

But then that’s just my preference and this is exactly the problem with trying to predict the future: technological ability and readiness does not equal ubiquity of adoption. The road to innovation is littered with plenty of brilliant ideas based on technological innovation that never got off the ground for one reason or another. What these failed innovations neglected to take into account is something that will be near impossible to quantify for generations to come, maybe forever: human behaviour, which is complex, irrational and variable.  As much as generations of marketers have tried to predict human behaviour through market research, the cold hard truth is that it cannot easily be squeezed into bell curve modeling.

Think about the phenomenal success of Groupon, which left the business world speechless for the simplicity of its premise, even though it is based on satisfying one of the most basic of human instincts: to get a good deal. So for my part, the next time someone asks me what I predict the next killer-app for a hotel to be, I think I opt for a good bed.