Hotel CEOs talk about Wi-Fi and other tech issues

— -- Hotels face new challenges as they continue to recover from the recession, including tech-savvy, Web-surfing travelers who have different expectations as guests than do prior generations.

USA TODAY assembled five of the industry's top executives last month at the Americas Lodging Investment Summit in Los Angeles in the LA Live JW Marriott hotel for a discussion of the industry's latest developments. They were: Marriott International CEO J.W. "Bill" Marriott Jr.; InterContinental Hotels Group (IHG) CEO Richard Solomons; Carlson CEO Hubert Joly; Choice Hotels CEO Steve Joyce; and Eric Danziger, CEO Wyndham Hotel Group.

The discussion ranged from hotel Internet fees to iPad apps, new lobbies and chainwide hotel renovations. The hour-long event was moderated by USA TODAY's Barbara De Lollis. The text has been edited for clarity and length.

USA TODAY:Internet access is a top amenity for travelers. With the iPad revolution, bandwidth use is growing at a faster pace. What are you doing in response?

Marriott: Well, we're working to try and get down to a few (Internet) suppliers, because in the past we had a bunch of suppliers, like 80 or 90. We have 3,700 hotels and everyone's hired their own supplier, so we're trying to narrow the number so we can increase bandwidth and improve the service. It's a huge problem. Everyone wants to talk in the room and they want to download everything they can. It's getting to be quite a challenge.

IHG: I also think we're going to have to look at things like differential charges. (For instance,) basic wireless you could get for free and maybe you pay more for high speeds so people who really want it can get it. We all see it as an issue. It's one of the big dissatisfiers that you see in a lot of hotels.

Carlson: Free Internet is the greatest demand in terms of amenities of the travelers. It's almost like having water or air conditioning in the room. So we have a strategy of offering this for free at an increasing cost (to hotel owners).

Wyndham: We offer it for free in most of our brands, though not all of them. But whether you charge or whether it's free, you'd better have some dependability and reliability because it will become the single source of complaints. By the way, truck drivers who stop at Super 8 are using mobile devices, so it is widespread.

Choice: We have been free for a long time. It is interesting that the last remaining places where hotels are getting away with charging for it are at the upper-upscale and luxury levels. I think the expectation is that it should be provided free.

USA TODAY:Can offering free Wi-Fi help differentiate a hotel chain from others?

IHG: The question is not whether (free Internet) becomes a differentiator. I think the bigger issue you're going to see is the small chains or the unbranded hotels are going to find it just continually harder to compete. You see sales of iPad devices and mobile are up, so (providing free Internet) is very hard if you're a small player.

USA TODAY:How has the iPad revolution changed the way travelers book rooms?

Choice: We were out really quickly trying to chase the iPhone user and then the Droid user. Business from mobile reservations is up 255% this year. But the interesting thing is it's not mobile or PDA, it's iPads, so we're scrambling to get an iPad application out in a month or so. Our customers used to drive down the road, read a billboard and pull over someplace. Now they're looking at an app, and they're evaluating the seven different hotels within 7 miles. They're looking at the price and looking if they can drive another 20 miles, if they can save $5. If we're not on the device they're using to book, we're not visible.

USA TODAY:All of your companies — excluding Carlson — recently invested in Room Key, a new hotel search site. Why do you think customers want another online choice?

Marriott: It's an opportunity for you to go the on Web in the search engine, see a variety of brands and then pick the one that you want to go to and go directly to it. In our case, when you do, if you go to Marriott through the Room Key search engine, you get your Marriott Rewards points. If you go through Expedia or another site, you don't, so that is an advantage to the customer.

USA TODAY:It's getting easier for travelers to find customer reviews on your websites, whether from TripAdvisor or your guests. How is your company embracing this trend?

Carlson: On any shopping website, be it sporting goods or electronics, you have that readily available. On Amazon.com they have tons and tons of comments. This is the nature of the Internet, where information is pervasive. Ignoring it is like you're trying to stop the tide with your two hands.

Wyndham: We're going to have TripAdvisor (reviews). The consumer wants it. We know that 40% to 60% go to TripAdvisor.

IHG: We are moving to reviews on our site. It makes a lot of sense. It's what consumers want.

USA TODAY:Is there any other benefit to having customer reviews on your site?

Wyndham: There is a side benefit. Ultimately, I believe the quality of the product will improve (because) now you have direct feedback from a consumer to an owner or manager that you must respond to.

Choice: When you struggle to see how you're going to engage customers, this is one that resonates most. It causes some unique issues, so we actually went out with a trial two, three years ago and put our own customers' reviews — not TripAdvisor's. We are now going back and looking at a combination. It was clear our reviews by themselves were not sufficient.

USA TODAY:When will travelers be able to use smartphones to unlock a hotel door?

Choice: We're working on it. Clearly you will check in and be able to enter your guest room in five years from your PDA.

USA TODAY:Many of you talk about customizing the hotel experience to a specific audience. Is that the next trend?

Choice: I actually think for the next several years, value is much more important than customization. I don't know any segment of the business where people aren't demanding more value, and I think that will remain until people feel like they have recovered their wealth, which is going to be 10 years from now. It's free Internet, free parking, free breakfast and other services they want but don't want to pay additional for.

USA TODAY:Can you point to a requirement that customers don't want to pay for?

Wyndham: I'll give you a goofy one. I always wondered why it was a brand standard in most mid- and upscale hotels to have a bathroom phone. Is that something that customers say makes a difference? To me, I'm not touching the phone in the bathroom, and wouldn't that money be better spent on giving customers something they really want? A complete review of brand standards came as a result of the downturn, and it's to the consumers' benefit.

USA TODAY:Another since the recession?

Marriott: One of the things we're trying to do is have our manager at the front desk at check-in and check-out greeting customers, thanking them for their business so there's a manager present who wants to take care of the customer on a personalized basis. We encourage that.

USA TODAY:Hotel rates are projected to rise this year, but will we see them rise everywhere?

Carlson: The gateway cities are going to be a place where rates are going to continue to rise. If you look at the trends, particularly business travel, what's growing faster in 2012 is international travel. That tends to hit the gateway cities.

Marriott: There are a lot of so-called gateway cities that are not getting a rate increase, such as Washington, D.C. Government is cutting back. Congress is in session three weeks a month instead of four.

Choice: What you're seeing is the elimination of a lot of discounts, so you'll have a shift that changes the overall rate that's paid. But the reality is, we're not seeing any markets where hotels are making very aggressive price increases.

USA TODAY:As travel rebounds, will you add back jobs?

Marriott: It depends on the demand of the particular hotel. We're not adding back people just because things are going better. But there are cases, such as this conference here in Los Angeles. We're staffed up, but after you guys leave, there won't be many people.

IHG: We learned, as we do in every downturn, how staff can be more efficient through multitasking. In some places, we've seen staff engagement go up and service go up because people have taken on more roles. The other thing to remember is that for a lot of owners, they have rising energy costs, rising people costs … so I don't think you're going to see massive increases in employment because the top line is going up.

USA TODAY:Many chains, including Marriott, are reinventing their lobbies to make them inviting, social places. Do guests like the new look?

Marriott: The feedback is terrific, because it's an opportunity to socialize, have something quick to eat, sit in the lobby and work on your computer. At this hotel here (LA Live), you look at the people in all their little pods and areas talking, meeting, visiting and eating. It's a socialization of the lobby, which has never happened before in our industry, because people used to go in the lobby, check in, check out and then leave. Today, they're all over the lobby, and they're coming back to the hotel and using the lobby for a drink afterward.