Cloud technology s role in the hospitality industry

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Hi and welcome to this month's editorial  video where we're discussing PaaS  or Platform as a Service. Quite a few people  asked me when we came up with this topic   what exactly is that and what direction do  you want to take with that editorial? So let's   go through some of the details but before we do  also joining me in this video are Richard Castle,   Co-Founder, President and Chief Operating Officer  of Cloudbeds and Stephen Burke, Chief Commercial   Officer at Sciant. So Platform as a Service, it  can all be wrapped up under cloud computing.   It's that simple. Okay thanks for watching see  you next month. Yeah, okay no, it's not really  

that simple. So you're all aware cloud computing  in the hospitality industry has started to play   a crucial role. We've got the cloud and under  the cloud or rather within the cloud are these   supporting services of which PasS is one of them  or Platform as a Service. Also is SaaS, Software   as a Service, which is perhaps the most common at  the current time in our industry but there's also   something called Infrastructure as a Service. So  as you can see these three elements show that the   cloud now plays a major role in many industries  as well as ours. But it is time for our industry   to start to capitalize more on all of these  elements and all of the elements of the cloud.  

So you've most likely heard of SaaS, Software  as a Service and possibly even Infrastructure   as a Service. A definition of infrastructure as a  Service could be as follows. It's the type of cloud   computing service that offers essential computing  storage and networking resources on demand,   on a pay-as-you-go basis. IaaS is another type of  cloud service along with Software as a Service   and of course Platform as a Service. So where does  Platform as a Service sit in all of this and what  

is it really? Platform as a Service is meant for  developers to build and customize business hosted   applications without the headache of maintaining  the software. It makes it easier for organizations   to save money and be able to make the most  of its cloud resources such as data centers   servers and of course storage. True Platform as  a Service should help businesses reach their   intended IT destinations quicker with fewer errors,  fewer resources and even greater benefits. Platform   as a Service systems should enable users to move  existing applications to the cloud and support   application deployments across both on-premise  and cloud deployments. It's an interesting point   there. Moving existing systems onto the cloud.  Something that many hotels struggle to deal with. Platform as a Service can streamline workflows  when multiple developers are working on the   same development project. If other vendors must  be included Platform as a Service can provide  

great speed and flexibility to the entire process.  Platform as a Service is particularly beneficial   if you need to create customized applications.  Aaah, customized applications. But who's doing that   in our industry and why should we even start to  think about it? Well, Numa a group out of Berlin   have built their own full stack software suite and  have digitized over 80 percent of their internal   processes. From booking to room allocation to  housekeeping, accounting and more. This keeps   them very scalable and cost efficient and helps  them to navigate any future potential volatile   market fluctuations such as another COVID.  Let's go now to Richard Castle from Cloudbeds. When we think of Platform as a Service, companies  that come to mind are companies like Google,   uh Google offers a Platform as a Service so I  can as a web developer, I can create a web app   and I can release it into Google's Platform  and I don't have to think about infrastructure.  

I don't have to think about how many servers  I need or databases or anything like that   and I think that that is true Platform as a  Service. In the context of Platform as a Service   for lodging businesses or the hospitality  industry, I'm thinking mostly of Software as a Service, that is  designed to be an open platform where   hoteliers, developers, you know I.T people,  anyone setting up the system can customize and   create a system that works for their lodging  business in in for the needs that they have.  

So not just configurability  but extensibility of that.   The ability to extend the  user interface, the ability to extend the workflow and have that wrap around  the needs that I have as a business, as a lodging   business. I don't think there are any platforms  out there today uh that truly accomplish that   in the way it's accomplished in in other  industries such as you know Salesforce starting   in the CRM you know vertical. Obviously they do a lot  more than that now but Salesforce is a proprietary  

open platform. It's Software as a Service but  it's an open platform in the sense that I can   extend Salesforce, I can inject my own or create  my own user interface. I can build that on top   of Salesforce and and the infrastructure  that Salesforce provides and tie it into   the stock user experience that Salesforce provides  as a platform. And that is what I would consider   I think in this context, Platform is a Service In  the software as a service uh domain. I think  

true Platform as a Services is like Google for  example, uh Google cloud and running applications   there. So I really don't think there's any, there  are no companies that are have actually   accomplished true extensibility from a user  interface standpoint and and uh customizability of   like a stock solution that's that's provided. When  you consider what Platform as a Service really is   is, it's an opportunity for developers to be to  be able to develop and create within the   cloud environment let's say, so that they're not  restricted to legacy or proprietary methods. Is   this something that we really need or is it,  because it comes back to the question of should   hotels basically create their own platform,  their own tech stack, should they be writing   their own solutions or should they be buying it  and then building it? I really don't think one   needs to exist without the other. I think if if if  you look at development on Salesforce for example,

we use Salesforce Cloudbeds. We use Salesforce, we   in the early days of Cloudbeds in 2012 we  didn't extend Salesforce right? We didn't   put a lot of development effort, any development  effort in to Salesforce. I mean we might have used   its API, we, you know, had custom fields and we  used Salesforce to design some workflows but   we weren't hiring developers and we didn't have  a team that was extending Salesforce. Now, today   uh Cloudbeds is doing a lot more with Salesforce  and extending it right? And and and I think that   if I apply this this to the  lodging industry I think there are hotel groups and flags that need to extend,  they need a solution to extend uh into their   own workflow, their own customization, their  own user interface, their own brand uh and and   business logic. They need to extend a  solution into their uh into their business   and and these are typically larger enterprise uh  large groups with with uh discretionary budget   and technology and they can hire consulting  firms or they or they can employ their own   development teams. On the other side, if I think  of you know if if I'm running a bed and breakfast   in you know Austin Texas or a Posada in  northern Brazil, I probably will, I probably   almost certainly do not need to extend a  platform. I want something that works out  

of the box right and I want it, I want it to be  end to end and take care of my my technology   needs uh reservation management, distribution, right,  analytics like all of that I want taking care of.   Front desk right? And I don't really want to have  to think about extending the platform so I think,   I think there's a world where uh extensibility  and a stock solution coexist and it really depends   on the needs of of the customer that that you  know on the customer that's coming to purchase   a solution, what they need for their, for their  business type and and I think that both exist, so   there's room for both. In your opinion does this go  really way beyond just having having open API's and   a marketplace of apps? Which is really what what  our industry is kind of building or has built a   lot of hype around in the recent past and still  do. To me it seems like this goes way beyond that.   I think this does go way beyond  open APIs and an app marketplace.   I think, I think open API's and an  app marketplace also need to exist.   I think extensibility of the platform, so the  the ability to develop in the platform extended   inject your own user interface and  workflows with a, with a development team   is uh well beyond an open API or just just  extending an API uh and I just think that   it's, it's kind of a spectrum of needs and even small properties need uh to take advantage of   like a door lock company for example. A door  lock company that's in a marketplace that

is offered in a marketplace that can be connected  to a PMS or you know, whatever that that   business is using to manage, manage its property.  And I think that you can't do that without an API  in a marketplace and I think there are you know  even smaller properties that you know might want a   custom guest experience or they might  want to put a kiosk in their property in,   and they might hire a development firm uh  you know like a hostel might hire somebody   and and pay them you know several thousand dollars  to extend the, a PMS's API into a into a kiosk and   and to do that you need an open API right?  You don't really want, I want to be able   to do whatever I want with with the API um but  extending the platform goes well beyond that   and that is actually a development  environment um in which you can uh   write code and actually extend the user interface  in the workflow of the platform. And that   you know, it's it's we're a ways away  from that, I think as an industry and uh   I think that's that's where things are going and  but, but we wouldn't leave, we wouldn't leave behind   open API marketplace. Those would always be there  as well. You know historically our industry has   data silos everywhere, do you think that PaaS  or PaaS solutions are a step forward in terms of   influencing the democratization of data for  our industry, is there some way that that can   democratize data so that anybody that needs to  share for example a guest profile across various   different systems, is that, is that going  to be possible through PaaS? It would be possible   and if you look at other extensible platforms  they have moved in this direction and it's just   um it's an extension of the platform and it's  a place where the platform can, can create a   a warehouse of data or a place where data data  sits and that data can be shared and accessed by   various third parties that want to  extend the platform and use the data and   and you get into uh I mean, you, you just  have to make sure that the the data is permissible. You have permission  to access the data between  

the the party that owns the data and the party  that wants to do something with it. As long as   that contract is made and the platform does  not intervene. The platform should not take uh   should not take customers data and use it uh  without permission from from from those customers   um then, then you have a very nice uh extensible or  let's, let's say, I don't want to say universal, but   maybe universal data solution or place where data  lives that um removes the burden of of having to   um continuously and constantly store and  catch data as a, as a third-party application   for example and pass that data to somebody else  and and I think we in the hotel industry, we   all struggle with uh data moving right among  partners and third parties and I think that   um it becomes contractually very difficult  for data rights and it becomes difficult to always provide high quality robust solution for  customers right? Because data is just constantly   moving around and sometimes it's out of sync. So  I do think, I do think that that extensible   platforms will present opportunities for uh  centralized but open data, if that makes sense.   I mean when you say centralized, it does sound  it does sound like like there's one company that   controls all of it but, but if it's designed  correctly I think the the contract between   or on sending and receiving data can be made  between those two third parties and it does   not have to like Cloudbeds for example does  not have to uh we just have to make sure to   honor those relationships in those contracts and  we would provide a place for that data to live, yes.   Let's hear what Stephen Burke from Sciant has to  say. What are some of the common solutions that are  

included in Platform as a Service? So um one of the  things that we should talk about is the definition   between Platform as a Service, Software as a  Service and Infrastructure as a Service right? And   one of the best definitions that I've heard about  this is that Platform as a Service is something   that developers will use to create and deliver a  cloud-based application. A Software as a Service   is something that's directly used by end users  and Infrastructure as a Service is delivering a   vital component such as computing power like a  server or some storage or something else that's   a key ingredient of of these these applications.  And all of these things are available today.   There's many many providers out there you know,  we all know Amazon, Microsoft, Oracle, Google   but there's a lot of niche players out there as  well. And it's also important to think about in   reference what it used to be like to set up a uh  hosted application you know 20 years ago, 15 years   ago and so on because you always had to start  with putting something in a data center right? At the end of the 90s, beginning of the  uh of the aughts's uh, hotel technology was   was predominantly delivered uh as an on-premise  component right? So all the servers were local,   you had an IT manager that was dealing with  everything. Then we moved to this hosted or this  

ASP type of solution and I remember when we were  doing companies like uhHBSI 20 years ago right?   The first thing that we had to do is go  out and spend you know, maybe a hundred,   two hundred thousand on infrastructure that we  had to stick into a data center which was uh   servers, you know application servers, database  servers, um routers and network gear and firewalls   and so on, so it's very CAPEX heavy and any  hotelier that's had experience deploying uh   solution in those days or an on-premise solution  in a networked environment remembers that very   clearly. It's like the first thing you have to do  is spend a bunch of CAPEX right? And um this is and   then you have to manage it. So you have like this  upfront CAPEX you have this big OPEX and then on   top of that you got to put your application costs  and you had licenses and then support and so on.  

And the advent of all these Platforms and as  a Service and Software as a Service has made   things much much easier because it's offloaded  this to become an OPEX, it's offloaded the support   and all these other things that you need to  to make it work. So you know some of the big   names in the Platform as a Service space are  obviously you know the big ones like Google and   Microsoft and so on and then there's niche players  like Heroku and Digital Ocean and things like that.   Everybody has something that that's helpful  and and can be used, so if you have a favorite   vendor today, probably they have something that  you can you can work with there, um but to give   you an example of some of the things that we use  at Sciant to deliver solutions to our customers.  

One of the things is something called Serverless  Computing and Serverless Computing is basically,   the cool parts about it are it literally doesn't  have a server. So you pay only for what you use.   It's only working when there's something to do so  it's like kind of an on-demand type of solution.   You don't have any management fees that you're  paying because it's not really a server. What it   does is, it's like, you know it's like a little uh  resident guy that's sitting there and it has some   some code in it and uh so the moment you invoke  it uh basically you ask it to do something it   spins up, it does whatever it's supposed to do and  then it kind of turns off and this is something   that we use a lot. Not only for integrations which  makes a lot of sense because when you have it in   integration for example like if you want to send  availability rates and inventory somewhere right?   Most of the time if you had that running on  a on a server like a virtual machine um it might   not be doing anything at the time, it might just be  running windows or or linux or something like that   just the operating system um or or an antivirus  or something but it's costing you money right?   So if you put it into serverless computing  then it's only going to do something when   somebody sends a rate message or somebody  sends an inventory message to it. Then it   takes it, digests it, puts it into the database and  then spins down again so you're not paying for it.  

When in your opinion should the hospitality and  travel industries start to apply and use PaaS   as a mainstream solution and why? So you  should do it right away actually because   your competition is is already doing it. So  at Sciant we have some Platform as a Service   offerings that we provide such as interface as a  service and we're also doing something today that   we call bespoke software as a service. So I'll  explain both of those and why they're important.   So interface as a service is something that  sort of grew out of the origins of Sciant and   what we knew uh from from our experience  in the industry and so on and what we   uh have continued to see is that there's a lot of  companies in our space that have like brilliant   um revenue management systems or brilliant upsell  systems or brilliant um CRM type of systems right?   But we have so many different systems  that run a hotel right? You know it   could be 20 to 35 different systems.  They all have to be integrated and  

companies generally that are building these new  capabilities you know they're not thinking about   integrations as a core requirement. If they've  got a bunch of data scientists working on revenue   management those data scientists aren't really  thinking about, okay well I got to integrate   this with the PMS right and every PMS is gonna  be different because there's very few that run   on standards in the industry they usually are  creating their own. Even the new ones that are   coming out, they're all creating their own new sort  of messages right and new way of of working.    So that integration part still exists. So we found  that people want to offload that, so what we did is   we started to create an integration as a service  which is basically a cloud-based uh capability for   people to just uh interact with different systems  right? This is where the Platform as a Service   becomes very important because they can have  something that they own right, but it's completely   portable to, you know, they can have it in their  own Azure or AWS environment or they can host it   in their own uh Oracle environment or they can say,  hey, you as a vendor, you take care of it in yours   and I'll call you if I need anything. So what it  practically does is it puts the business users in  

the hotel and the business stakeholders in charge  of getting what they want having it hit their   budget but not actually having to deal so much  with centralized IT functions. So it's going to   be interesting, I think this is going to catch on  more and more and more as uh as hotels are finding   you know in this new environment that they  need to do more with less that uh technology   and IT talent is becoming uh less and less  available and they need to look at other ways to   quickly get to where they need to be. Are there  different types of PaaS solutions and options   available in the marketplace and if so how many  and what exactly are they? Sure, great question.  

There's a lot there are a lot of different  possibilities. There's you know the generic ones   that we already talked about and then there's  a bunch of very uh specialized ones so uh from   data analytics as a service to machine learning  as a service to robotic process automation as a   service to data platforms, customer data platforms  as a service and so on you name it, it's probably   out there or somebody is working on it. There's  also groups that I don't personally work with   and that Sciant doesn't work with but that do have  some very rich ecosystems like Salesforce   and their force.com platforms. Especially  with their acquisition of Mulesoft and Slack.   They're going to be providing an amazing amount  of functionality that you'll be able to use   to to deliver your your solution  that you need and we also have   companies like like SAP making their their  business applications available in Oracle as well.  

Basically you can build a Software as a Service  today um by sort of outsourcing the components   to best of breed right? So what that  means is that you'd be able to leverage   through a Platform as a Service some  piece that has already been built before   and is done by somebody who really knows what  they're doing that 10 years ago you would have had   to build yourself. So most of us have used software  packages that include like an accounting package   or or a dispatch package or like an order  management package or something like that   well there's a lot of those out there right and  why if I'm building some hotel software do I need   to build an accounting module or do I need to  build a billing module or an identity management   system within it right? When I should be able to  use somebody else's that did a really great job.   So what these new uh Platforms as a Service  are offering us the ability to do is to build   software but outsource the things that are not  the components that we are best at to somebody   who is best but still present the user with this  single coherent solution. And this is done by the  

use of API's in the background and the use of  of these various Platform as a Service items. So what are the advantages? Well first of all  it should be cost effective, there shouldn't   be any need to purchase hardware or pay for any  expenses during downtime. Time savings, no need to   spend time setting up or maintaining the core  stack anymore on an on-premise basis. Speed to   market. Speeding up the creation of apps is always  very important for any agile business. Future proof.  

Access to state-of-the-art data center hardware  and operating systems is also available. Well with Platform as a Service of course data  security needs to be considered and scrutinized   and the reason is because the information is  stored off-site. And not every part of a company's   existing infrastructure may be built for the cloud.  So that's something to really consider when doing   due diligence and as with any product or service  look at the right providers. A less than ideal   PaaS provider could leave your company feeling  a little frustrated and perhaps even confused.

So in conclusion, the hospitality  and travel industry could see   huge cost savings by integrating cloud  computing into their service offerings.   Cloud computing is just about  managing IT through remote services   such as PaaS, IaaS and SaaS. There's so much that  cloud computing offers the hospitality industry   such as cutting costs, increasing accuracies  and efficiencies from analytics to communication,   from customer communication to training. Cloud  computing has so much to offer. Technology is  

becoming a driving force as far as the success  for our industry and organizations are concerned.   Productivity, enhancement, security, better  service, all contribute to competitive advantages   over our competitors. Thanks for watching, I hope  that helps break it down a little more for you   and also make sure that you check out and listen  to the podcast session for this month because we   do dig deeper into these areas with both Richard  and Stephen. Until next time, it's bye for now.

2024-07-24

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