Are Hotels Jamming 3G Access?

By Art Reisman

About 10 years ago, hotel operators were able to squeeze a nice chunk of change out of guests by charging high toll rates for phone service. However, most of that revenue went by the wayside in the early 2000s when every man, woman, and child on earth started carrying a cell phone. While this loss of revenue was in some cases offset by fees for Internet usage, thanks to 3G access cards most business travelers don’t even bother with hotel Internet service anymore — especially if they have to pay for it.

Yet, these access cards, and even your cell phone, aren’t always reliable in certain hotel settings, such as in interior conference rooms. But, are these simply examples of the random “dead spots” we encounter within the wireless world, or is there more to it? From off-the-record conversations with IT managers, we have learned that many of these rooms are designed with materials that deliberately block 3G signals — or at best make no attempt to allow the signals in. This is especially troubling in hotels that are still hanging on to the pay-for-Internet revenue stream, which will exist as long as customers (or their companies) will support it.

However, reliable complimentary Internet access is quickly becoming an increasingly common selling point for many hotels and is already a difference maker for some chains. We expect this will soon become a selling point even for the large conference centers that are currently implementing the pay-for-access plan.

While meeting the needs and expectations of every hotel guest can be challenging, the ability to provide reliable and affordable Internet service should be a relatively painless way for hotels and conference centers to keep customers happy. Reliable Internet service can be a differentiating factor and an incentive, or deterrent, for future business.

The challenge is finding a balance between the customer-satisfaction benefits of providing such a service and your bottom line. When it comes to Internet service, many  hotels and conference centers are achieving this balance with the help of the NetEqualizer system. In the end, the NetEqualizer is allowing hotels and conference centers to provide better and more affordable service while keeping their own costs down. While the number of 3G and 4G users will certainly continue to grow, the option of good old wireless broadband is hard to overlook. And if it’s available to guests at a minimal fee or no extra charge, hotels and conference centers will not longer have to worry about keeping competing means of Internet access out.

Note: I could not find any specific references to hotels’ shrinking phone toll rate revenue, but as anecdotal evidence, most of the articles complaining about high phone toll charges were at least 7 years old, meaning not much new has been written on the subject in the last few years.

Update 2015

It seems that my suspicions have been confirmed officially. You can read the entire article here Marriott fined for jamming wifi

Canadians request comments on traffic shaping practices

Art Reisman CTO

I am not sure if this is open to Canadians only, but the CRTC (the Canadian equivalent of the FCC) has set up a site for comments regarding their policies on Internet traffic shaping. The site is open from now till April 30th and can be found at

So if you get the chance chime in and give them your thoughts.

For the fun of it (see below) I grabbed a few of the existing comments truely at random. After reading them it is funny how the consumer sentiments so far are in total agreement with what we NetEqualizer have been proselytizing  which is:  “Traffic management is fine as long as there is full disclosure of policies”. Nobody wants to pump gas without knowing the grade and the price and the same goes for their Internet service.


“Any traffic management practices deviating from complete network neutrality, that is to say, any practices that single out one protocol over another, should certainly be disclosed to the user in the service agreement. To disclose anything less would be consumer fraud.”

“Traffic management has a real impact on the product that a consumer is paying for. All ISPs are not created equal and consumers aren’t in a position to analyze the complexities of network management and the possible impacts on their usage.”

“All traffic shaping practices should be disclosed, in plain English, online and as a part of the terms of service.”

“I agree with the other posters thus far — if ISPs are allowed to get away with uncompetitive throttling of Internet traffic, those techniques and the effect on the customer should be fully disclosed in plain versions of both official languages.”

“Any new communication technologies can be thwarted if ISPs deem them to be competitive with any of their services, stifling innovation. Even the CBC has used BitTorrent to distribute programming, and..”

NetEqualizer the Safe Bet for Optimizing Internet Link During Economic Downturn

We just announced a record profit for the quarter ending September 2008. I have included a copy of that announcement below.

Although we do not believe (or want to see) our success come at the expense of other players in the market, there is a strong contrast if you compare our performance to the higher-cost publicly-traded players in this market (see charts below).

I suspect these high-end shapers with expensive sales channels  may have trouble in this slowing market as they come under price pressure. IT departments continue to cut costs and the main play  of optimization products, reducing  ROI,  will lose some luster as Internet costs slowly fall. At some point, a high-end piece of equipment will lose out to adding more bandwidth.

NetEqualizer, on the other hand, is priced so much lower than these other products that our window of value will extend out at least another 10 years — perhaps more.

Although we are private company, we would be happy to share financials under NDA with any customer that has concerns going forward.  We have plenty of operating cash on hand and will likely expand as we pull out of this downturn and customers continue to look to reduce costs.

Stock charts for major players in the Internet/WAN optimization market

Now, here’s our latest press release reporting profits…


APconnections Announces 50-percent Increase in Profits During Current Quarter

LAFAYETTE, Colo., Sept. 22, 2008 — APconnections, a leading supplier of plug-and-play bandwidth shaping products, today announced that sales revenues have increased by 50 percent during the current quarter.

Company officials report that APconnections is finding that a growing number of ISPs, businesses, libraries, and universities are looking to the NetEqualizer to solve their Internet bandwidth congestion issues, oftentimes switching from more expensive traffic shaping solutions.

As companies deal with the ongoing economic struggles that have hit the nation, the NetEqualizer’s rare combination of effectiveness and affordability has been a major factor fueling this growth.

Other factors driving the upturn are:

  1. Comcast has adopted a similar fairness-based strategy to solve Internet congestion issues, thus validating APconnections’ long-held belief that deep packet inspection is on its way out. (See APconnections’ previous announcements on net neutrality:
  2. Direct sales and support for 90 percent of their customers, thus reducing the overall cost of sales.
  3. Simple turnkey set-up allowing new customer installations to require only one hour of support.

The NetEqualizer is a plug-and-play bandwidth control and WAN/Internet optimization appliance that is flexible and scalable. When the network is congested, NetEqualizer’s unique “behavior shaping” technology gives priority to latency sensitive applications, such as VoIP and email. It does it all dynamically and automatically, improving on other bandwidth shaping technology out there. It controls network flow for the best WAN optimization.

APconnections is a privately held company founded in 2003 and is based in Lafayette, Colorado.

YouTube: The Unfunded Mandate

As some of you may know, I have chimed in several times on the debate on Internet access and the games ISP play to block certain types of traffic (Bittorrent).  I have leaned toward the side of Internet providers and defended some of their restrictive practices. I took quite a bit of heat for some of my previous positions. For example, this excerpt was posted in a discussion forum as a reply to an opinion piece I wrote recently for Extreme Tech magazine:

“So I was wondering why Extremetech would allow such blatant misinformation and FUD on their site…”

First off, please understand my point of reference before assuming I am an industry shill. I am an unbiased observer sitting on the sideline.

Secondly, you can villainize providers all you want, but they exist to make a profit. It is, after all, a business. And now they are facing a new threat with the explosion of YouTube and other video content. Here are some trends that we have seen.

Back in 2006, on a typical footprint of usage patterns on an ISP network, streams exceeding 200kbs (that is 200 kilo bits of data per second) averaged around 2 percent of the users at any one time. Almost all other streams were well under 50kbs. The 2006  ratio of big users to small users allowed  a typical Internet provider to serve approximately 500 people on a 10 megabit circuit without any serious issues. Today we are seeing 10 to 15 percent of the active streams exceeding 200 kbs. That is about a 700 percent increase in the last two years. This increase is mostly attributed to increased online video with  YouTube leading the way.

The ramification of YouTube and its impact on bandwidth demands is putting the squeeze on providers– like it or not they have not choice to but to implement some sort of quota system on bandwidth. Providers invested in certain sized networks and capacities based on the older usage model and smaller increases over time, not 700 percent in 2 years.  Some providers did build out higher capaciites with the hopes of reaping returns by supplying  their own video content, but as the caption says, running other people’s video content without sharing the revenue was not planned for.

Was that a mistake this lack of capacity an evil greed driven conspiracy? No, it was just all they could afford at that time. Video has always been out there, but several years ago it was just not in any form of original content that made it compelling to watch from a public content site . I am not predicting Armageddon caused by overburdened Internet access, however, in the next few years you will see things get ugly with finger pointing and most likely Congress getting involved, obviously to saber rattle and score brownie points with their constituents.

With all that said, we will do our best to stay net neutral and help everybody sort it out without playing sides.

See our recent article on net neutrality for more details.

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