Thursday, 15 January 2015

A leap of faith away from metal keys - challenges facing the emerging smartlock industry

The greatest challenge facing the emerging smartlock industry is getting the general public to take a leap of faith to replace the 4000 year old trusted metal key with an electronic gadget which secures access to your most sacred place, your home.

You've probably opened your car, your hotel room and your office without sticking a key in the door for at least a decade, so the big question is why do we still use old-fashioned keys on the locks at home?

Maybe its because people have so many what-if questions such as ‘what if your phone dies and you’re forced to sleep in the backyard, what if it goes haywire and lets in murderers, or what if the lock is hacked?

We've really only had the choice to move away from metal keys and ask these 'what-if 'questions in the last year or so and this blog explores why.

The leap of faith away from metal keys has already been taken in the hotel industry. 

Computerization in the 1980's saw the introduction of electronic magnetic stripe keycard locks into hotels. These systems overcame a number of deficiencies of the metal key such as the need to physically replace the lock should a key be lost (or forgotten to be returned to a hotel reception).  Magnetic stripe keycards overcame the negative aspects of the metallic key as electronic locks could merely be re-programmed. Magnetic stripes also introduced new advantages such as the ability to audit entry into a room such as a hotel tracking cleaners and room service times of entry as well as the ability to integrate into the hotel’s guest management software and booking systems.

Just as computerization laid the path for magnetic stripe based electronic keycard locks in hotels, the rise of the internet has opened new opportunities for efficiency's and customer convenience in hotels and other related industries. Airline travel for example was one of the industries most impacted by the internet as the end product did not need to be physically delivered to the purchaser – all that was needed was an electronic ticket or boarding pass to be delivered over the internet. The iPhone for example comes with the ‘Passbook’ app for keeping boarding passes, movie tickets etc. in electronic format on your phone.

The seemless use of web enabled access in the hotel industry falls down due to the requirement for a physical metal, magnetic keycard or RFID keycard to be given to the consumer.  For the hotel industry to keep up with industry standards and consumer preferences it needs to overcome this bottleneck. And the way to overcome this bottleneck is with smartlocks and digital keys - using new technologies hotel guests can now download a time-sensitive digital key inside a hotel app which gives them access to their room only for the duration of their booking.

The end of magnetic stripe keycard technology is upon us

Is it the end of magnetic stripe keycard technology?
So do smartlocks and digital keys spell the end of magnetic stripe keycards in hotels? Whilst technologies have moved forward over the past two decades so too have illegal ‘hacking’ methods for accessing our secure information. The magnetic stripe keycard technology has proven to be most vulnerable in recent attacks. The credit card hacking scandals in Target, Home Depot, Marcus Neiman and others, illustrate the pain consumers must go through as a result of big companies holding on to the outdated and failing magnetic stripe technology (perhaps you've had your magnetic stripe keycard stop working in a hotel before?). As a result of recent hacking scandals, credit card companies are moving to chip enabled cards and Near Field Communication methods (‘NFC’) such as ‘Paywave’ as more secure methods of transacting business. As the widespread use of NFC in credit cards has spread around the world, so to has its use in smartphones. NFC can now be found in over 400 million smartphones, and around one in three phones manufactured these days include NFC.

New smartlocks also make use of this NFC technology. Guests can use a hotel app to make their own keycards which only work for the room they have booked for the duration of their booking. E.g see apps below. Available in the Google Play store here.

Are Hotels keeping the faith?
There still exist a number of smaller hotels and holiday apartments that utilise a physical metal key access control method.  This exposes the hotels to expensive lawsuits who have a duty of care for their guests. Anyone can cut a copy of a metal key and give themselves unauthorised access to the hotel room at any future date and time, and attack people in the rooms and steal their belongings. 

As the smaller hotels and holiday apartments face the need to refurbish their hotels, they also face the need to upgrade their metal key locks to an access control system that is more secure, customer friendly yet cost effective.  

The small hotel operators or holiday apartment centre management are aghast at the quotes of $400 to $8,000 per door to install magnetic keycard systems which they know are insecure and breaking down. They also do not appreciate that such systems require Cat 5 computer cabling to be run from each door back to the hotel’s onsite computer servers, Magnetic stripe or RFID readers at each door, encoders for cards to be reprogrammed for new guests, PC  & software and integration costs to connect to the guest management reservation software and  databases.  

Smartlocks and Digital Keys require none of this supporting network infrastructure, which means for the first time there exists a simple easy installation, making the leap away from metal keys easier for the hotelier and the homeowner.

Until now many small hotel operators the cost to achieve electronic keycard systems is prohibitive and they are forced to continue with antiquated metallic key systems – paying the locksmith to replace locks on a regular basis.

Larger hotels face a different competitive environment and are driven by different value propositions.  These typically, 3 to 5 star, 100 room plus establishments need to be seen as modern, efficient, secure hotels, leading with exceptional customer service.  Whilst they may already have installed the wiring and infra-structure for a magnetic stripe or RFID system (which was possibly installed a decade ago), their brand requires them to be state of the art with their product offering.  The magnetic stripe or RFID system does not provide seemless access of booking, through to online checkin and immediate access to their room – especially if the traveller is arriving after reception hours. The magnetic stripe card or RFID card method looks ‘tired and antiquated’ for the traveller that used his smartphone as a boarding pass on the flight he arrived on.

Steve Wozniak using new Smartlocks and digital keys in Starwood Hotels California
Finally there is an alternative - the Global Hotel chains lead the way with smartlocks.
In the last six months 4 out of the top ten global hotel chains have announced significant investments to begin roll out digital keys smartlocks in all of their rooms. Hilton Hotels, the second largest hotel group, recently announced a $550 million dollar investment to begin rolling out Digital Key smartlocks in all 650,000 of their rooms by the end of 2016. Starwood Hotels, the seventh largest hotel group with over 330,000 rooms have already begun rolling out Digital Key smartlocks in 10 of their 1100 hotel rooms across the globe. Accor Hotels, the 6th biggest hotel group with over 450,000 rooms also recently announced a $330 million dollar investment to roll out digital key smartlocks in all of their rooms.

The hotel industry has lead the way in departing away from metal keys over the last 30 years. They've been the testing ground for advancing more secure and more efficient access control technologies. The hotels (and the traditional lock manufacturers) will soon show you that with new smartlocks you don't have to worry about locks going haywire and not working, or being hacked, or your smartphone battery dying (NFC tokens can also be used).

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