Hotel Video on Demand is dead – isn’t it?

No it isn’t. On the contrary, “on demand” is more popular than ever. Wanna check e-mails, surf the net, listen to music? Take your smartphone. O.k. that’s not video, but no big difference here. Videos are either stored on iPhones, iPads, Notebooks etc. waiting to be consumed “on demand” or streamed (speak Netflix and Co.).

However, what I think is dead – or at least seriously ill – is the business model known in the hotel industry as VoD or Pay TV. Collier PKF Hospitality Research reports $ 126/room annual income from in-room movies in 2009 – a decline of 26% compared with 1999.

In 2009, the revenue of one of the biggest VoD providers for Hotels in the US dropped by nearly $50 million, or 9.3 percent, to $484.5 million, from the previous year, according to a company earnings report. Their downward trend continued through the second quarter of 2010, when the company reported a net loss of $3.1 million, according to an earnings report.

One of the bigger hotel chains stops to offer adult content (at least in new properties) – declining revenue.

Besides, it’s still quite an investment if you want to offer VoD, even more if you want to provide new releases. Especially the necessary efforts around licensing/security issues accounts for real dollars. Nowadays one should think twice if the investment is really worth it.

So nobody wants to watch videos on demand anymore? Nope, more than ever. It’s just nobody wants to pay a lot for something he has better and cheaper ways to get..