Sramana Mitra: Your number one competitor is Oracle, based on what I just heard, because Oracle is moving all their stuff to the cloud. It’s reasonable to expect that you’re going to have Oracle as a major competitor because Oracle has a big emphasis over on-cloud technology.
Ric Leutwyler: Of course. There are a number of others as well that are playing in this area in trying to achieve what we’ve already achieved. I think it’s been very interesting to watch the space because you’ve people making inroads in very different ways. Like you just mentioned, you’ve a group like Oracle, which is huge. They’re now probably acquiring the largest player in the marketplace and trying to move them towards an approach. Then you’ve groups who have started from scratch and just built something in the cloud and trying to get some strength and momentum in the marketplace. There’s quite a few that, whether it’s hundreds or thousands of installed properties, are just trying to convert into the cloud. The way in which they go about that is really important because it’s a lot harder to do it the right way, but it’s the only way that you really give the customer what they end up needing.
Sramana Mitra: How many customers do you have?
Ric Leutwyler: We have a little over 5,700 spread out amongst seven countries.
Sramana Mitra: Is there a segmentation to that? If you look at your competitive landscape and the whole situation, is there one kind of companies that are gravitating more towards you? Is it the mid-market or the large hotel chains? Is there any kind of segmentation where you’re seeing more traction than other places?
Ric Leutwyler: There is. Choice Hotels have 11 different brands, but those 11 brands are spread across a certain set of those segments – select service, limited service, and some more upscale properties. Those are the target audience that the system was designed for and enhanced with regard to over the last 10 years. That’s where, out of the gate, who we are a perfect fit for.
What we’ve been doing is evaluating the marketplace to determine which market segments we would next want to move into. How would we need to evolve our platform to be as attractive to other segments as we are currently to the ones we serve so well? That’s where we’ve spent a lot of our time. We get very focused on what is that marketplace opportunity from the number of properties, the value of those properties based on what kind of needs they would have, and which of our services they would want. Then what is the scope of work required to meet the different segments?
Las Vegas casino hotels, for example, have some very unique needs. There’s not a ton of them. If you spend a whole lot of time building to attract that particular audience, I’m sure we could get a lot of that business from them but it’s such a limited audience. We’re targeting more on areas where we can get more bang for our buck in the short term.