Cloud technology's role in the hospitality industry
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 13:42
