IT companies spurn hotels

[dwarakesh]

If the IT industry collapses, it seems many companies are in a position to reinvent themselves as hoteliers.

Aiming to enhance business through hospitality and guarantee somewhere to stay, they are offering rooms to visitors and travelling executives. The strategy is highly cost-effective compared to using regular hotels. Commuting can be avoided because these units are part of the workplace facility.

Infosys Technologies accounts for 13,000 rooms throughout the country, including a 500-room facility in its Electronic City campus in Bangalore, about 10,000 in Mysore, 1,000 in Chennai, 1,000 in Pune, 500 in Bhubaneshwar, 450 in Hyderabad and 250 in Chandigarh. The company has also invested $ 2.4 billion in adding another 3,000 rooms.

Wipro shows a 30 per cent increase over the number it had an year ago. Presently, the company has 500 rooms across three of its facilities in Bangalore Electronic City, Sarjapura Road and Koramangala, says the Times of India. Bangalore alone has 1,200 to 1,300 rooms belonging to IT/ITeS companies, 20 per cent up on last year. TCS, Satyam, HCL, IBM, Accenture and HP (EDS) are amongst other companies providing accommodation.

However, the trend is bad news for the hospitality sector, reducing occupancy in star hotels and serviced appartments by at least 15 to 20 per cent. Mohan Kumar, general manager of Taj West End said that it  takes away 30 to 40 rooms per day from the hotel room inventory in the city. Infosys propably saves about 70 to 80 per cent on accommodation costs by running its own hotel, said Taposh Chakraborty, CEO of Boutique Hospitality Consultants.