Back in 2010, not long after I started blogging here on Cisco.com, I discussed some of the challenges customers were fearing regarding the feasibility of cloud adoption. In my market research work, the survey I ran back in 2010 came up with some interesting concerns: that lack of bandwidth and internet reliability was an impediment to cloud adoption. I discussed this later when I wrote about Cisco’s “Network on Wheels”: “… one of the things we learned that in certain parts of the world, the access bandwidth to the cloud was a significant concern – in terms of reliability, cost and bandwidth available”.
Having lived my life in urban areas with reasonable network services (although it’s only a year ago we managed to get fibre-based broadband – more precisely Fibre-To-The-Cabinet), this survey result was a bit of a surprise to me. Yes, I rationalised, looking at the countries which reported this issue, I can see that is an issue in some parts of the world that would impede adoption of cloud services. But not here in the UK, Europe or North America. How naive and arrogant was I!
Fast forward to 2016 – I can’t believe I’m writing this about my own country!– in my very own back yard in Scotland, my local mountain ski centre, Glencoe Mountain, is experiencing real pain from customer dissatisfaction – they can’t process credit card payments fast enough, which is resulting in long 30 minute+ queues at their ticket office on busy days, preventing enthusiastic yet impatient skiers from getting up the mountain to enjoy the snow. And all because of the lack of reliability and bandwidth in their so-called “high speed” internet access to credit card payment services.
I’ll structure my discussion into 3 areas. First, mountains are inaccessible, provision of high speed internet is a challenge. Right? Wrong! So I start with a discussion on the digital transformation of ski resorts as proof of that. Then I’ll discuss the economic impact on the broader community in internet-poor locations, and finally I’ll cover the bigger picture – the Internet of Things (IoT) opportunity available to innovative and forward-thinking service providers who seek to transform their business models from data pipe providers to “connected experience” IoT solution providers.
Digital Transformation for Ski Resorts Has Arrived!
The term “Digital Transformation” is undoubtedly one of the key IT trends – or buzzwords, depending upon your perspective – of 2016.
There is no question in my mind that digital transformation has arrived in the snow sports industry ski resorts. 3G is widespread and it’s not uncommon to find Wi-Fi in the leading European resorts (yes on the ski slopes themselves – Saalbach in Austria, for example, I understand has a Cisco access point on every lift), supporting resort and holiday company mobile apps. Whistler-Blackcomb in Canada, as another example, has partnered with Telus to deliver digital mountain experiences (more on this in part 2 of this blog next week).
I personally am a huge fan of the Ski Tracks smart phone app – which essentially lets you “connect” your skis to the Internet, reporting speed, distance travelled, slope including and photos you take on your travels, and more, and allows you to upload your adventure to social media to share with friends. Network-based applications, enabled by in-resort 3G/4G/Wi-Fi include “Find my friend” (on the ski slope!), resort ticketing and hotel booking features. Social media is a now huge part of snow sports – a glance at the Glencoe Mountain Facebook page will illustrate this. Many people share photos and videos as an integral part of their skiing experience. Such media sharing is an incredibly important parts of the ski centre marketing capability.
Unfortunately, such digital transformation opportunities in Scotland are gated by poor internet provision.
The Economic Impact
Scotland is not particularly well known as a ski location. Many people I speak to from outside Scotland are surprised we have ski facilities. Sure, we’re not of the scale of Breckenridge in the U.S. or the Three Valleys in the French Alps, however each of the five (or 6 if you include our Lowther Hill “club field”) ski centres is a major UK tourist attraction in their own right, and we have some fabulous skiing, as the video shows, despite Scotland’s incredibly unpredictable climate!
Notably, each winter, the ski centres bring hundreds of thousands of people into the remote and stunning Scottish Highlands. Consequently, they generate major spin-off income – typically £30 million per year – for the local rural economy, helping create and sustain many jobs outside the centres themselves – hotels, catering, retail and more. They are also major tourist attractions in summer. Glencoe Mountain, for example, has over 70,000 skier visits in winter, 150,000 visitors annually, and it’s one of the smaller centres. Over 1 million vehicles per year (according to Transport Scotland data) pass their front door. Tens of thousands of walkers annually use challenge themselves to walk the West Highland Way that runs through the ski centre. Heck, even the James Bond film ‘Skyfall’ had scenes filmed here (I’m glad he didn’t need internet access!).
Yet, despite the volume of visitors, this ski centre can’t reliably process credit card payments. Never mind offer fast high capacity Wi-Fi to visitors. They had to drop on-line ticket sales and appeal for customers to come prepared with cash – all as a consequence of their internet challenges. IoT-style Ski Apps like they have on the continent? And Apple Pay? “That’s ‘dream world’ for us until we get internet and cloud access suitably addressed”, said Andy Meldrum, the resort owner.
They are not the only business suffering. In the same area, the historic Clachaig Inn has been known to loose internet connectivity for its (typically) 80-90 guests, resulting in negative TripAdvisor reviews as well as lost custom. Cycle hire and avalanche education specialist CranKitUp Gear reports that at times their customers have to wait up to 45 minutes to check on failed internet payment transactions. Owner Davy Gunn commented: “The Internet of Things? More like the Internet of No-Things for this part of the world”. And Glencoe Mountain Cottages, set in the idyllic Gleann Leac Na Muidhe area, have no mobile coverage and a maximum broadband speed of 400 KB/s (yes, that’s Kilo-Bits per second for all you kids out there that don’t remember when this was internet speed! :-)).
Each of these businesses report losing business as a result of current internet provision. As Forrester Consulting would describe, such businesses are at risk of becoming “Digital Prey”.
The Cloud and the IoT Impact: Adoption Limitations
There are additional implications for cloud and IoT services, resulting in business productivity impacts and limiting the potential of cloud and IoT initiatives. Business travellers using Microsoft Azure Cloud and Microsoft 365 – currently being heavily sponsored by Microsoft in the Scottish press – can forget about these productivity tools in large parts of the Scottish Highlands. Connected Vehicle applications also are impacted: the 3G SIM in BMW “ConnectedDrive” cars will be – unfortunately – pretty useless on long stretches of the 167-mile A82 – the major west coast trunk route from Glasgow to Inverness – where even 3G (never mind 4G/LTE!) is not available from my mobile service provider, and even their 2.5G/GPRS is pretty patchy on this route.
Add in neighbouring tourist facilities including hotels that are disadvantaged. Now multiply that by 5 . And that’s just the ski areas. What about the other tourist attractions in internet-poor locations? And you get an idea of the scale of the economic impact.
Now that I’ve discussed at length the challenges, in part 2 of this blog, which I’ll publish next week, I’ll consider the opportunities for the service provider. In part 2, I’ll cover innovative business models that service providers could use to justify the investment necessary to solve these challenges, including the Internet of Things. One example I’ll cover will be how Canadian SP Telus leveraged sports sponsorship marketing to provide the return for their investment at Whistler Blackcomb resort, where Telus– notably without any public funding – delivered top to bottom mountain WiFi and cellular services in exchange for sponsor marketing exclusivity. I’ll also discuss how my colleagues here in Cisco Services have delivered innovative networking solutions to connect remote locations and communities and provide WiFi on cruise ships.
In the meantime, feel free to post comments below or contact me via Twitter.
(Edit: NOTE: Part 2 is now available here)
PS: My inspiration for this blog came from a few sources:
- The “banter” (some may call it “whinging” 🙂 ) on the main Scottish snow sports forum, Winterhighland.
- A ‘brainstorming’ workshop I helped setup last week with the University of Strathclyde MBA program and Snowsport Scotland. Thanks in particular to one group of MBA students who pointed me to the innovative Telus example.
- Cisco’s Time2Give program which gave me time to arrange the aforementioned workshop!
- Andy Meldrum, owner at Glencoe Mountain Resort
- Davy Gunn, Owner at cycle hire and avalanche education specialist CranKitUp Gear
Thanks to all!
Part 2 to this blog is now available – see http://blogs.cisco.com/sp/part-2-the-ski-centre-queues-and-the-service-provider-internet-of-things-opportunity
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