Hotels offer free Internet to snare patrons

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— When Mike Lomas found his 77-room hotel competing with not one, but two large hotels, he decided against getting cheaper. Instead he got faster.

More specifically, Lomas is offering guests high-speed Internet access at no additional charge.

Lomas manages the Ptarmigan Inn on Apres Ski Way for its owners. He is also the owner of the Alpiner in downtown Steamboat and a partner in Sky Valley Lodge on Rabbit Ears Pass. The Ptarmigan has been in its prime ski-in, ski-out location for more than 20 years.

But new luxury condominiums have virtually blocked views of the hotel form the street. And it must compete with the nearby Sheraton Steamboat Resort and Steamboat Grand hotels, which operate on a much larger scale.

"The Ptarmigan has been 100 percent dependent on the ski business for 20 years," Lomas said.

With the impending opening of the Steamboat Grand, Lomas anticipated he would have to improve his hold on his niche. And when the Grand began offering very competitive discount packages, he knew that would take a bite out of his ski season business.

"We have to do something different, because you've got large, very nice hotels (right next door)," he said. "You've to to do something to compete."

One of the ways Lomas is competing is by offering free high-speed, T1 Internet connections in his guest rooms.

But he isn't stopping there. Lomas has placed full-size computers in guest rooms at both the Ptarmigan and the Alpiner motel on Lincoln Avenue.

Use of the computers and the Internet is available to guests at no extra charge.

"Just like there are coffee makers, VCRs and hair dryers in the rooms, there are computers," Lomas said. "We will hopefully attract a business clientele that values that."

Lomas leases the computer equipment from a company called Remote Executive Office Inc. (REO). He pays a flat fee to REO for each occupied room night. And although he declined to reveal the fee, he acknowledged it represents a significant percentage of his room rate.

Rooms with king-size beds at the Ptarmigan are currently renting for $82 mid-week and $92 on weekends.

The computers are located on writing desks in the hotel's 30, king-size rooms.

Mid-week room rates downtown at the Alpiner, with the computer usage built into the rate, are $69.

The Alpiner is across Fifth Street from the Routt County Courthouse and attracts many business travelers Lomas said.

He frankly admits that he didn't set out to offer free computer and Internet usage. Instead, he planned to catch a new wave in the hotel industry and capture a new revenue stream through in-room Internet access.

Thus far, the industry and Lomas have learned the traveling public isn't as prepared as anticipated to whip out their credit cards and connect to the Internet.

"To start with, we went wireless," Lomas said. "That was very cutesy, but very cumbersome for casual laptop users. They had to reprogram the drives on their laptops. We said, 'This ain't going to work,' so we rewired both hotels."

Lomas also found that his ski season guests, even though they wanted a chance to connect to their e-mail back home, and in some cases, stay in touch with the office, often did not pack their laptops along with their ski boots.

Lomas turned to REO and had computers loaded with the Microsoft Office package of software placed in the rooms.

The plan was to require a credit card number before guests could access the Internet.

"Nationally, the acceptance was only 2 percent," Lomas said, and his properties didn't do much better.

"Nobody was using it, so we built it into the room rates."

The hotels don't have a high-tech way to track guests' computer usage, but Lomas and his staff plan to survey guests.

They'll attempt to find out if they enjoy free computer availability enough that it might cause them to return to the Ptarmigan and the Alpiner.

"I think it will build long term," Lomas said.

The business model that works for in-room movies in hotels hasn't yet proven out for Internet access.

But Lomas feels it's only a matter of time until travelers come to expect computers in their rooms, just like they've come to expect irons and ironing boards.

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