Netflix is taking over TV content at hotels

On average, only 1 percent of occupied hotel rooms orders paid video on demand on any given day, and 90 percent of the profits from those transactions are for adult entertainment. But at hotels that replace VOD with Netflix, 40 percent of rooms stream something from the service on average, according to Enseo, an in-room entertainment technology company.
 
Guests who watch Netflix on their guestroom TV also tune in for much longer than they use other sources of content. The average news or sports viewing session in a hotel room lasts 14 minutes, said Vanessa Ogle, Enseo’s founder, chairman and CEO. The average Netflix session comes in at 90 minutes, she said.

Enseo struck a deal with Netflix that allows the company to integrate Netflix’s app into the TVs of hotel rooms worldwide. Enseo’s solution asks customers to sign in with their own accounts to access their recommendations, and also comes with a Netflix button on the in-room remote control. In addition, guests will not be required to pay in-room Internet fees in order to access the Netflix application on the Enseo device. When guests check out, their Netflix user credentials will be automatically removed from the device. Hotel brands can also just integrate Enseo into their mobile apps so a guest doesn’t have to install another app, Ogle said.

Enseo’s technology uses the current infrastructure within hotels to find the best implementation of its technology to turn each guestroom into a “smart room,” Ogle continued. “It is a series of hardware and software platforms that can be implemented over existing coaxial cable,” she said. “The reliability is staggering.”

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Enseo’s network reached more than 20 million people in 2016, according to the company. During this time, hotel guests consumed more than 4.7 million hours of over-the-top entertainment through Enseo’s platform. Millennium Hotels and Resorts also completed a nationwide upgrade to all technology services, including high-speed internet access, Wi-Fi, and guestroom entertainment in all U.S.-based hotels through Enseo.

Enseo isn’t the only company bringing Netflix and other streaming services to the hotel room. Some competitors use solutions based on Google’s Chromecast technology to do the same, but Ogle said that her company instead opted to build its own technology and directly integrate streaming apps.

In-room entertainment is high-value to guests

Guests expect the in-room experience to be as good, or better, than at home, according to a recent white paper from ADB on in-room entertainment preferences. The most important conclusions ADB concluded is that in-room entertainment in general is important and of high value to guests, and as chain scale of the hotel rises increasingly upscale toward luxury, guest expectations for a superior IRE experience also trend up.  

Guests, particularly millennials, really do want to view their own content on guestroom televisions. Hoteliers and guests value different IRE services with vastly different weights—hotel executives tend to weight most services more strongly than guests, with the most overweighted items are IRE staples like video checkout and pay-per-view. The key finding is that all categories of guests feel the in-room television experience is important to them, but probably not so important as to drive the choice of hotel by itself.

Specific features that guests define as providing a better-than-residential experience include picture clarity, more channels and premium content better than what they have at home.

Seventy-three percent of millennials in the focus groups consider TV as “very important” compared to 42 percent of the older travelers. Millennials are more enthusiastic about screencasting than the other age groups, but on a par with older guests for OTT, noting that both services are really means to achieve the same end: viewing one’s own content.

Technophile guests carry an average of 1.71 smartphones and 1.49 laptops in the traveling party. But the millennial age group carries more, an average of 2.48 smartphones and 2.22 laptops per travel party, pulling up the averages. They carry more tablets, too.

When asked “Which, if any, of these devices do you connect to/watch over your hotel room TV?,” the finding was that 57.4 percent of guests are attempting to connect their own devices to the in-room TV (via a cable or streaming device).

The majority of guests across all age groups are watching Netflix, YouTube, Amazon Prime and Hulu.

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