Clients book cruise vacations because they want to
relax, visit interesting destinations and have fun. But that doesn't mean they
won't stay connected to family and friends while they're away.
Many expect to tweet, text, check email and post
pictures to social media sites from the middle of an ocean.
Indeed, the number of iPads, iPhones and other
Web-enabled mobile devices in use by passengers at a shipboard lounge often
matches the number of rum punches and martinis on the bar.
For cruise lines, it sounds like a simple win-win situation: They
invest in an infrastructure to provide reliable Internet connectivity at sea,
making them competitive with land resorts, and the rewards come with per-minute
rate packages that contribute to onboard revenue streams.
Bow-to-stern WiFi-enabled ships, a rarity even a few years ago,
are commonplace now.
But the rocket science
behind the technology that enables at-sea Internet service is complicated. Speed
and reliability vary from ship to ship, and more than a decade after Internet
service was introduced onto cruise ships, slow connections and breaks in service
can still perplex passengers.
In simple
terms, shipboard access to the very big Internet relies to a great degree on a
Very Small Aperture Terminal (VSAT), a system of above- and below-deck equipment
and devices that serve as conduits to satellites 22,000 miles above the Earth's
equator.
A VSAT antenna coupled with the
amount of bandwidth a cruise ship has available tell the story of onboard
Internet connectivity.
Using a VSAT
system, data request signals, which occur when someone tries to access a website
from a computer onboard a ship, must travel to an orbiting satellite, bounce to
an earth station and then travel back to the satellite before returning to the
shipboard computer.
It's a 44,000-mile,
roundtrip journey, and while experts say it takes only a half-second for a
signal to reach a satellite from a shipboard antenna, the start-to-finish
connectivity process is considerably slower than a land-based routing.
Unplugged, but plugged inGiven the prevalence of wireless Internet on
ships today, it's surprising to recall that the first big ship built with a
dedicated Internet cafe, the Norwegian Sky, debuted a dozen years ago. The
Carnival Valor, which launched in 2004, was the first to offer wireless Internet
throughout the ship.
"It used to be that just company presidents and CEOs needed
Internet access, but now it's everyone," said Vicky Garcia, executive vice
president of sales and marketing at Cruise Planners/American Express. "We don't
know how to disconnect, even when we're on vacation.
"You may not be actually 'working,' but you're posting a photo on
Facebook and answering email," Garcia said. "It's funny how everything has
become so viral, like people posting photos of themselves from a cruise even
after they've had too many drinks."
And
more cruise clients, she added, are asking about the cost of Internet
connections before they leave on a cruise.
"Teenage kids for sure are asking, especially if they got stung
before," she said. "We had some kids on a cruise, and it was like sticker shock
when they saw the prices at the Internet cafe."
Connection rates, Garcia added, "come up a lot" in predeparture
conversations with customers.
"We see it
on our message boards: agents asking about various cruise line policies so they
can tell their clients. It isn't just corporate clients asking, either; it's
everybody."
Internet pricing is fairly
level across different cruise lines, give or take a few cents. Most lines will
offer several prepaid Internet packages in addition to a nonpackage, per-minute
rate. The more minutes a passenger buys, the cheaper the per-minute rate (
see chart at left).
For example, a 100-minute Internet package on Norwegian Cruise
Line costs $55, or 55 cents a minute. In some cases, passengers who don't buy a
package can expect to pay 95 cents or more per minute.
Joyce Landry, CEO of cruise meetings and incentives firm Landry
& Kling, said the newer ships have "stem-to-stern WiFi, while older ones
still might have hotspots," meaning locations on the ship, like a lounge or
library, where passengers must go to access connectivity.
Anyone who has cruised on a ship that provides Internet service
is likely to have seen the MTN logo on the dome that houses a VSAT antenna on
the decks of the vessels. Looking like giant, white light bulbs, they're hard to
miss.
MTN
Satellite Communications has a corner on the cruise ship market, with every
major brand using the Miramar, Fla., company's VSAT system. It also provides a
growing portion of satellite-based TV service on cruise ships.
Its infrastructure of geostationary satellites
and earth stations provides service to some 600 vessels worldwide, including
cruise ships, ferries, cargo ships and government vessels, plus offshore oil
rigs and government and commercial aircraft.
"We don't own the satellites, but we lease satellite capacity on
a long-term basis from the satellite operators," said Brent Horwitz, senior vice
president and general manager of MTN's cruise and ferry business. "The largest
ones are Intelsat, SES and Telesat."
The need for speedThe
unpredictable and sometimes snail-like speed of connectivity can be frustrating
to cruise passengers. Shipboard speed is routinely compared to the old dial-up
systems, but there are several issues that determine how fast or slow a
connection at sea will be, Horwitz said.
According to Horwitz, the speed of connectivity largely depends
on how much bandwidth the cruise line is buying for each ship.
"Satellite capacity is more costly than on
land, hundreds of times more costly," he said. Obstacles to speedy connectivity
are not unlike what consumers experience in their homes, Horwitz said.
"Even if you
have DSL cable at home, it depends on how many people are online," he said. "It
also depends to a very great extent on whether the cruise line is effectively
using optimization devices that compress files and accelerate the signal." An
example of a compressed file, he explained, would be a zip file that can contain
many documents or images, such as passenger data that has to be sent to an
onshore corporate office.
There are two
frequencies that the cruise industry uses to bounce signals onto satellites:
C-band and Ku-band.
"The majority of large
ships will use C-band," he said. "Ku-band is more susceptible to 'rain fade,'
when bad weather interferes with signals to the geostationary satellite.
"The trend is for zero tolerance for down time
in 2012, so most ships have dual-antenna systems, sometimes in both
frequencies," Horwitz added.
MTN has
several earth stations, including its largest in Holmdel, N.J., which covers
most of the Western Hemisphere. Earth stations receive and respond to data
requests that first hit a satellite.
"It's
an enormous infrastructure making the global connectivity possible," he said. In
addition to Holmdel, MTN has smaller stations in Atlanta, Los Angeles and
Washington state, which handles the Pacific region. Other stations are in Spain,
the U.K., the Netherlands, Germany and Hong Kong.
"Above the Earth, we have 32 satellite beams that we access; the
North and South Poles are the only areas not covered," Horwitz said.
"What's happening is that the cruise lines no
longer really see other cruise lines as their primary competitors," he said.
"Land-based resorts are the primary competitor, and what the cruise lines are
doing now is upgrading these networks and building out the WiFi infrastructure.
They are investing in more bandwidth and using the latest acceleration and
compression techniques available."
He noted that, with cruise lines under pressure to increase
onboard revenue, "Internet access is on their radar screen."
In the not-too-distant future, Horwitz
predicted, the overall onboard connectivity experience is going to improve
because of the cruise lines' actions as well as improvements in satellite
technologies.
Regardless of the different
factors that affect Internet speed, the absence of a direct competitor to MTN in
the cruise market isn't one of them, he said.
"We have a few competitors, but
in the cruise industry space we are the leading provider," Horwitz said. "We've
created an equation that makes sense for the cruise industry."
Bill Martin, chief information officer for Royal
Caribbean Cruises Ltd. (RCCL), agreed.
"MTN
is focused on our industry," Martin said. "They are not the only provider of the
service; there are some much larger than MTN that [primarily] supply oil rigs,
freight carriers and the military. But because there are other players out
there, it keeps MTN honest."
The cost of
connectivityMartin said his
company continuously looks for ways to provide better Internet access, but it's
all about the cost of bandwidth.
"I'd love
to tell MTN that they are way too expensive, but it costs a lot of money to
[maintain their infrastructure]," he said. "I'm not at liberty to say what it
costs us, but it's extraordinarily expensive."
Basically, Martin said, a large ship will buy 4 megabytes of
download speed.
"I have twice that much in
my own house," Martin said. "It's about half of what the average home would have
with high-speed DSL, which would provide at least an 8-megabyte download."
But on cruise ships, data is highly optimized,
or compressed, he noted.
Norwegian Cruise
Line's Ross Henderson, vice president of onboard revenue, was willing to reveal
some cruise line expenses.
"In terms of
cost, satellite equipment is a one-time capital expense," he said. "Full WiFi
installation for a 3,000-passenger ship would probably cost around $400,000 --
that's for bow-to-stern access. Then you have the ongoing monthly fee for
bandwidth, but I don't have those numbers."
He said that the cruise lines get a cut of the Internet access
costs that passengers pay for.
"There is a profit margin on the per-minute packages," he said.
"It's challenging to figure it out, and I don't have those numbers, either."
On Norwegian ships, the per-minute price
without buying a prepaid package is 75 cents. The line offers a three-tier
package, he said, and if a passenger buys a 250-minute plan, the per-minute rate
drops to the "37- or 40-cent range."
According to Henderson, less than half of Norwegian's passengers
use the Internet onboard. "More people will use it on longer cruises," he added.
Nonetheless, he said, guests use a big
chunk of the available bandwidth, and so does the crew. Corporate use is less
than that of either the guests or the crew, Henderson said.
"We have ability to allocate certain segments
of the [bandwidth] pipe; we try to give first preference to guests."
Henderson said passengers have become
accustomed to being charged for Internet time by the minute but said the
industry might someday charge by the megabyte.
"It could allow for more bandwidth in that scenario, because by
minute, one person could be using more bandwidth than another person, but
they're paying the same thing," he said.
The problem, Henderson added, is that "guests are not fully
knowledgeable about the size of the Web page [they might be trying to access]
and wouldn't know how many megabytes to purchase. But people are becoming more
savvy about that."
RCCL's Martin said he
increasingly divides passengers into two categories.
"There are technology natives: [younger people] who grew up with
the Internet and have no memory of life without it. And then there are people
like me, tech immigrants, who have learned to live in the tech world.
"For 'natives,' they have a hard time understanding what the
world is like without being connected."
And it's true that keeping the price of access high indirectly
limits its use, Martin said.
"Bandwidth is
expensive to increase," he said. "It's a constrained resource, there's only so
much available that we can provide. If we thought guests would buy more of it,
we'd be happy to provide it. We're trying to strike that balance."
Meanwhile, the communication needs of
passengers continue to evolve, according to Eric Merz, director of guest
technology at Carnival Cruise Lines. He noted that just a few years ago, there
were fewer passengers with laptops and WiFi-enabled mobile devices.
"Five years ago the primary social media tool
was Myspace," he said. "Today, people connect through Facebook, Twitter,
Foursquare, Yelp ... and the list keeps growing."
Merz said that about a quarter of the line's passengers use its
Internet services, "but it can vary by itinerary and time of year."
While the connectivity speed can be an issue,
Merz said that the majority of guests, especially repeat cruisers, "understand
the difference [between land and sea service], so we rarely get complaints about
the time it takes to connect with the Web."
