Dropsafe

by Alec Muffett

Hotels make extortionate charges for wi-fi access

Wow, someone finally spotted that. Took bloody long enough.

Independent

Hotels make ‘extortionate’ charges for wi-fi access

Once, it was the great telephone rip-off, when hotels charged business travellers huge amounts for calls made from their room. Now, according to a new guide, they have found a fresh way of fleecing guests – by adding high charges for wi-fi access to the internet.

According to the 2007 edition of The Good Hotel Guide, some hotels have been charging up to £5 an hour for wi-fi access, even though it costs less than £150 to install a router and thereafter there are no maintenance costs. It believes that the “extortionate” charges may have arisen because the increase in mobile phones means that hotels have been deprived of the income from telephone calls.

The Guide says that one hotel in Cambridge was charging £5 an hour – or £20 a day – until the bill was challenged. It then reduced it to £4.50 an hour or £14 a day, which it said was in line with its competitors in the area.

In London, the Savoy Hotel on the Strand charges its guests £9.95 for 24 hours’ access while the Knightsbridge Green Hotel in west London charges £3 for one hour and £12 for 24 hours. Yet many other hotels, the Guide points out, charge nothing.

continues…

<humour> Isn’t this just what happens when you privatise service delivery to the end-user in a monopoly environment without applying regulation? </humour>

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Comments

4 responses to “Hotels make extortionate charges for wi-fi access”

  1. Adriana
    re: Hotels make extortionate charges for wi-fi access

    The humour tag notwithstanding… WTF? Let’s not dwell on the fact that if you had regulation anywhere near the internet and its technology, wifi would probably not exist. Scrap probably, definitely.

    There are many hotels so can’t see the ‘monopoly’ you refer to. At the moment, the market is in ‘transition’ i.e. customers are being educated – the ones that need internet access are probably charging it to their business. The one who don’t, don’t. People like me, who live online, have to put up and wait for the demand to erode the extortionate margins. I actually choose my hotels according to availability of wi-fi as I expect increasing numbers of people do as well. There are already plenty of enlightened hotels that provide free wi-fi. Put regulation on it and you’ll be stuck with obsolete technology at ridiculous prices forever…

    Reply
  2. alecm
    re: Hotels make extortionate charges for wi-fi access

    Respectfully, I disagree; there already is heaps of regulation for internet provision, from the Wifi frequencies that can be used (some channels are restricted in France and the USA) to the power outputs of the devices; the forced deregulation of the BT local loop and (which i think you’ll agree is a good thing) and consequent locks on the price of DSL setup to stop BT from further monopoly abuse.

    Regulation that affects pricing and functionality is everywhere, although none of it yet impacts the *type* of traffic being exchanged on the net (ie: net neutrality).

    As for the monopoly: as an individual you are freer than us Corporate types who are often tied to “preferred vendors”, and if you’re a hotel within 5 blocks of the Moscone it is arguable that you have a captive audience, except for those people who go use Wifi in Starbucks after buying a wireless plan up-front for a price similar to the cost of using the hotel’s service.

    $15 a day for three days in the hotel, or $40 for a setup fee and a daily stipend for usage over the next few days.

    Which is more economic for the goober like me, who visits the USA perhaps once or twice a year?

    Reply
  3. Stephen Usher
    re: Hotels make extortionate charges for wi-fi access

    You are assuming that in the location you are going to that you have a choice of hotel (with or without WiFi) and the possibility of finding places outside the hotel with net access if you don’t want to pay the exportionate hotel charges.

    The case I can put forward is my recent trip to Tromso, northern Norway. I was not living in any hotel but to get net access the only places i could go with my iBook were either the airport or the Radisson Hotel bar. Both of these were charging ~£5 per hour.

    It would be useful to note that neither of these locations ran their own network. They both contracted in hotspot companies to supply the service, so it’s very probable that the hotel and airport are actually seeing only a small part of that £5 per hour charge and the rest is being gobbled up by the service company.

    Reply
  4. alecm
    re: Hotels make extortionate charges for wi-fi access

    ps: you certainly right that bad regulation is worse than none at all, and that most of the time the market can sort it out without regulation; but that’s the point of the humour tag… 🙂

    Reply

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