September 22, 2015
As hotels in the U.S. continue to offer faster Internet connections, an increasing number of guests are more inclined to stream video content via popular services such as Netflix, Amazon and Hulu than opt for in-house video-on-demand. As a result, hotels are beginning to experience a significant decline in VOD use. Some have recently cut their adult-themed VOD content, and may eventually do the same with other on-demand offerings. However, this may not be the end of video-on-demand in hotels if providers make their services more competitive.
“Marriott Hotels in June announced it would provide in-room Netflix, Hulu Plus, Pandora, YouTube and Crackle through guestroom TVs,” according to Hotel News Now.
Cory Chambers, VP and chief revenue officer for HVMG, suggests that even if a full-service hotel offers Wi-Fi access for $10 to $15 per day, guests see it as an economic advantage to use their own smartphones, tablets or laptops for video entertainment.
“Watching a TV show or movie on a phone or tablet doesn’t compare to watching it on a 50-inch or 60-inch TV, he said, so hoteliers need to think about offering TVs that can connect with those devices,” notes Hotel News Now.
“Will video-on-demand providers make their services more competitive? That’s the question that will determine what happens with on-demand entertainment in the future, Chambers said.”
Either way, analysts point out that change is inevitable. Cable and satellite companies are not the only ones feeling disruption from streaming services.
“The revenue figures just aren’t there anymore, and with the explosion of mobile devices and instant streaming video, on-demand entertainment is nearing extinction,” said Ryan Sorenson, president of hospitality consulting firm Lodgistic Solutions, adding that most hoteliers would likely phase out VOD by the end of next year.