Comcast Checks into Hotel Services Opportunity

Lands Deal to Deliver Service Bundle to Seven Hotels in Chicago and Michigan 5/15/2013 4:46 AM Eastern

The growing business service arm of Comcast has landed a deal to supply voice trunking, HDTV, and Ethernet-based Internet services to seven hotel properties run by Raymond Management Company, including five in greater Chicago and two in Ann Arbor, Mich.

Financial details were not disclosed, but the deal covers about 1,000 rooms, and is coming way of Comcast Business Hospitality, a recently launched division that will do battle in the sector against competitors such as LodgeNet, which emerged from a Chapter 11 reorganization in March.

Raymond Management Company manages 28 hotels in the Midwestern U.S. under well-known brands such as Hilton and Marriott,  with another four properties under construction. It picked Comcast for a subset of those properties in part because it was looking for a unified way to deliver a bundle of services across multiple properties.

After initially focusing on small businesses, moving up-market to serve mid-sized commercial entities serving up to 500 employees is now a key piece of Comcast’s business services strategy. The MSO generated $741 million in business services revenues in the first quarter of 2013, putting it on pace to pull down almost $3 billion this year. About 15% of that total is coming way of Comcast’s MetroE platform.

Comcast has estimated that the revenue potential for its small/mid-sized and small enterprise businesses are each worth about $15 billion.

Comcast said its fiber-fed Metro Ethernet platform, targeted to mid-sized businesses and currently offered in more than 20 major U.S. markets, is capable of delivering capacities from 1 Mbps to 10 Gbps.

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