Hotel operator Prime Hospitality Corp. has hit on a cost-effective way to give its guests high-speed, in-room Internet access.
The company realized it could save millions of dollars a year and improve productivity by converting its internal frame relay network into a hybrid Internet-based network that can be accessed by guests and employees. Instead of installing Internet circuits for Web surfing from hotel rooms (see "Transforming Travel," 6/26/00), Prime designed a network architecture that can handle guest traffic as well as the company's E-mail, reservations, and property-management applications. Guest fees for accessing the Internet cover the cost of the network, CIO Jim Crosby says.
"The old network was working fine, but obviously there was a cost associated with it," Crosby says. In rebidding its contract for data services, Prime, which owns 230 AmeriSuites and Wellesley hotel properties, awarded its frame relay transport business to WorldCom and its Internet business to CAIS Internet Inc., saving itself as much as $1,200 a month at each site.
The network uses a T1 line at each hotel that, for security reasons, is connected to two Cisco Systems routers at each site: a Cisco 1750 for the hotel's applications and a Cisco 1720 for guest access. At its headquarters in Fairfield, N.J., Prime has two T1s, two Cisco 3640 routers, and two Cisco 7500 routers, the latter connected to CAIS's two Internet points of presence.
Including hardware, it costs Prime $750 per month per hotel to provide network connectivity to each site--a charge that's offset by the $9.95 daily fee that hotel guests pay for Internet access from their rooms.
Prime is also looking into new revenue-and productivity-enhancing applications, since the hotel's traffic uses only half of the network's bandwidth. The company plans to add a database for managing a real-time, interactive loyalty program; access to a centralized database on hotel occupancy; financial and marketing data; records for a paperless travel expense and reimbursement system; Web TV, voice over IP, video display phones, and videoconferencing; and an online centralized property management system.
Nortel Makes A Play For Content-Delivery Market
Nortel Networks Corp. has finalized its purchase of Web-switch vendor Alteon WebSystems Inc. and formed a new business unit to go head to head with established content-delivery vendors. Alteon agreed over the summer to be acquired by Nortel for $7.8 billion in stock.
In content delivery, "the whole game is matching users to content intelligently," using criteria such as access privileges, user location, and user history, says Dominic Orr, former president and CEO of Alteon and now president of Nortel's content networking unit.
Alteon's intelligent switches may help Nortel reach its goal, but whether it can deliver the goods is another matter. "Nortel still has a ways to go if you compare what it has with what Cisco and Inktomi have," says Greg Howard, a principal analyst with HTRC Group.
The market for intelligent content load-balancing products will hit about $4 billion by 2004, according to International Data Corp. So far, the systems have been used mostly by specialized content-delivery and Web-hosting companies, but analysts expect them to show up in many companies' networks next year.
The unit will spearhead Nortel's effort to catch up to other content-distribution vendors--especially Cisco Systems, which got most of its content-distribution technology from a series of acquisitions during the past year--and beat Nortel by several months in its content-delivery strategy.
Nortel is counting on the content networking unit to offer unified Web-delivery systems. It will integrate Alteon's Web-switch and server-adapter products, the subscriber-management systems it picked up from Shasta Networks, and Nortel products such as mobile-access technologies.
