EL SEGUNDO, USA: After being hit hard by the economic recession in 2009, worldwide shipments of in-room televisions for use in hotels will bounce back with a vengeance to grow by a factor of more than four during the coming years, according to iSuppli Corp.
Hotel television shipments are expected to rise to 7.4 million units in 2013, up from 1.7 million in 2009, equating to a Compound Annual Growth Rate (CAGR) of 55 percent. The shipments represent in-room hotel TVs sized greater or equal to 30-inches.
“Much like the other sectors of the market for signage and professional displays used in hospitality businesses, the hotel television market felt the impact of the downturn in 2009,” said Sanju Khatri, principal analyst for signage and professional displays at iSuppli. “Although shipments grew by 33 percent that year, revenue declined as hoteliers opted for lower-cost and smaller-sized sets.
“Macroeconomic forces in 2009 also had a direct impact on spending, which meant that consumers and business people traveled less and spent less while on the road. As a result, the hotel industry saw numerous properties fall into foreclosure, and hotel construction in the United States and Europe declined in 2008 and 2009.”
Now, in the renewed economy and with rising confidence among hoteliers in those areas, the hotel industry is emerging from the recession with a renewed focus on enhancing the experience of its guests, expanding brand loyalty and maximizing profits, Khatri added.
As a result, iSuppli expects hotel TV shipments to increase robustly in the foreseeable future, fulfilling pent-up demand left over from 2009, with larger sizes in hotel TVs to become the norm as new construction of hotel properties takes place in the emerging economies. To this end, hotel shipments in 2010 are expected to grow to 3.1 million units, up a whopping 79 percent from 2009.
The figure presents iSuppli’s forecast for hotel TV unit shipments by region for the period of 2008 through 2013.Source: iSuppli, USA.
A major challenge for hoteliers is how to increase guest loyalty in order to encourage return visits. Furthermore, hotel franchises are looking at ways to raise their revenue per room.
One of the easiest ways for hotels to do this is by equipping rooms with flat-panel televisions that create a home-away-from-home experience. For hotels, flat-panel televisions open up a whole new world of entertainment options not offered by existing CRT sets, such as high-definition entertainment, MP3 playback capability, digital camera connectivity and more.
Consequently—and not surprisingly—hotels can create new revenue streams from video and other on demand services to derive additional revenue from guests.
The move to IP
A number of factors have prompted hotels to adopt Internet Protocol (IP)-based systems for their in-room technology offerings. As the costs for IP solutions fall, hotels are finding it easier to spend to implement the technology. However, this can be bolstered only by improving Internet bandwidth and the arrival of more reliable service.
At present, most new hotel properties are adopting IP-based in-room hotel services. The solutions give rooms the capability to interconnect various services, such as the Internet, video on demand, voice over IP and property management systems.
“iSuppli believes that the hotel experience for guests in the future will be very different from what it is today through the rise of a more personalized media approach, with each guest able to obtain access to individualized and interactive content,” Khatri said. “Nonetheless, the speed at which hotels can move toward this approach will depend on how future economic conditions or unforeseen events impact the travel and hotel industries.”
Source: iSuppli, USA.