Choice Hotels International Launches Stay Connect, Inc.

Choice Hotels International (NYSE:CHH) today announced the launch of Stay Connect, Inc., a hospitality technology services company created to provide high-speed Internet access for both in-room PCs and laptops to the lodging industry. The new company plans to install Stay Connect services in approximately 50,000 hotel rooms by the end of 2001.


Backed by one of the largest lodging franchisors in the world with a minority investment by Baron Capital, the prominent New York based investment advisor, on behalf of its investment advisory clients, Stay Connect is the first hospitality technology company of its kind to be launched by a hotel corporation. This company is also in the forefront of offering Internet access to all types of travelers, even those who travel without laptops.


As an endorsed supplier of Choice, Stay Connect has immediate and direct access to 3700 domestic Comfort, Quality, Clarion, Sleep, Econo Lodge, Rodeway Inn and MainStay Suites brand hotels.


The initiative to launch Stay Connect follows a previous test of in-room PCs by Choice, which indicated a strong demand for the amenity. Results revealed a 52% daily usage of in-room PCs for approximately 67 minutes per session - more than double the average online time of a typical Internet user session and more than the average time spent monthly on most Internet portals.


“When Choice first evaluated the demand for Internet connectivity from guests last fall, we recognized a huge - and untapped - business potential,” said Charles A. Ledsinger, Jr., president and chief executive officer of Choice. “Less than one percent of the U.S.‘s four million hotel rooms provide high-speed Internet access or in-room computers. To capitalize on this vast potential, we created a turn-key solution that provides guest room Internet services, including in-room PCs, to the entire lodging industry.”

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Daniel Rothfeld, senior vice president, e-commerce and emerging business opportunities at Choice, added, “Choice is strongly focused on developing business opportunities for the industry. Our ongoing research clearly indicates that the growing demand for in-room PCs and Internet access simply is not being satisfied by existing solutions. Being able to access the Internet is quickly becoming as basic to hotel rooms as refreshments, telephones and televisions, yet it is imperative to meet this fundamental need in a sustainable way that works for both guests and hotel owners. We believe Stay Connect provides the right solution for the whole industry.”


Stay Connect offers complete turn-key services from installation to in-room Internet PCs and a 24x7 help desk for a single low monthly fee. In addition, Stay Connect is in the process of developing its own Internet portal to create an added value for the hotel owner and guest.


David Goldberg, vice president, operations at Stay Connect, said, “There is no limit to the value proposition the Stay Connect solution brings to hotel owners. By meeting customer demand and providing a highly valued amenity, hotel owners can simultaneously increase room rates and raise occupancy levels. Our services provide all guests the ability to access all the Internet has to offer whether or not they travel with a laptop.”


Stay Connect has selected premier partners to provide a quality end-to-end solution to hotel owners and guests. Darwin Networks, a leading broadband solutions company, is managing the &qout;nerve center” of the Stay Connect service? - providing the entire telecommunications infrastructure.


David Wigglesworth, president of Darwin’s hospitality division, said, “We are delighted to be working with Stay Connect on this important business initiative for the industry. Their research, expertise and focus, coupled with a real understanding of the hospitality business and the needs of individual hotel owners, complements our strategy of delivering best practices in the business.”


In-room Internet PCs are being provided by Compaq (NYSE: CPQ - news). The stylish new `iPAQ’ Desktop PC offering one-touch Internet access will be installed in at least a third of all rooms in Stay Connect enabled hotels.
“We’re proud to be selected by Stay Connect as their technology solutions partner for equipping hotels across the U.S. with iPAQ desktop PCs,” said Mike Winkler, Senior Vice President and Group General Manager, Commercial PC Group, Compaq Computer Corporation. “Because of its simple design and small form factor, the iPAQ is the ideal platform for in-room computing, providing guests with anywhere-access to business applications, email and the Internet. As evidence of our goal to take everything to the Internet, we are pleased to provide Program Management Services and iPAQ desktop PCs to assist Stay Connect in their new venture to supply every customer with this high quality, reliable and valuable amenity.”


Headquartered in Silver Spring, MD, Stay Connect is an independent operating company owned by Choice Hotels International with a minority investment by Baron Capital on behalf of its investment advisory clients. Stay Connect will equip guest rooms in hotels nationwide with state-of-the-art in-room computers and high-speed Internet access for laptops. The company plans to install approximately 50,000 hotel rooms with the Stay Connect service by the end of 2001. For further information please visit www.stayconnect.com or call 1 888-304-STAY.


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