A hotelier was telling me the other day that in their view interactive in-room entertainment was a thing of the past and that guests were no longer interested in such services. Possibly very true, when a hotel doesn’t invest in the latest technology and services. However, when a modern system is placed in a hotel we note that the usage of services is actually increasing. This is a reflection of the consumer environment. Looking at the 2Q 09 results of one of the largest PayTV operators on Europe Virgin Media, they have announced a 3.8% increase in average revenue per user (ARPU) on the 2Q 08 results. And this increase comes despite challenging economic times. The increase is driven by the increasing number of users that take multiple services i.e. HSIA and Digital TV but also by the increase in the usage of various available TV services. Amongst these services, Virgin highlights Video On Demand, as well as HDTV among the services that usage is increasing. Virgin’s VoD service is now used regularly by 53% of their subscribers and there were 62 million VoD views in 2Q09, up 38 Million views from this time last year. In fact the popularity of on demand services is highlighted as one of the factors in the record TV viewing figures reported by the BARB (Broadcasters Audience Research Board) in the UK, with average daily television viewing reaching three hours and 45 minutes per individual. That is up 3% from 2007 and at one of the highest levels in recent years (BARB Bulletin March 2009). Clearly, despite the increase in broadband and PCs, the television remains the key viewing device in the home.

As such, we at Acentic expect to see an increase in the take up of our services as guests become regular users of on-demand services at home and seek to adopt the same behaviour within hotels. The advent of HD will just reinforce this trend.

Sources: 1) Virgin media 2Q 09 results, 2) BARB Bulletin March 2009