Three ways AI will change hotel tech

When I first created the hotel technology landscape chart back in 2015, it contained roughly 120 companies. At the time, it was often shared as a visual representation of confusion, showing how fragmented the industry was. But, what we were trying to map was how data moves in hotel tech, PMS to revenue management, to channel manager, to OTA, meta search, etc.

Today, the chart contains around 300 companies (and these are only the main players in each category) there are thousands of others. Yet, despite years of mergers, acquisitions, and consolidation, hotel technology keeps getting larger.

The question today is where does AI fit into all of this? Will it replace it all?

There is a narrative that AI will replace large parts of the software industry. The more time goes, the less I believe that will be the case. You cannot approximately process a payment. You cannot mostly connect to Booking.com. You cannot have an average room inventory. These systems exist because accuracy matters. The dark blue core of the chart is likely to remain very much intact.

There are three areas where I do think AI will bring change. The first is the analysis layer (outer rim). These solutions exist to help make decisions, assemble data, pre-analyze it etc. This is likely to change because AI dramatically lowers the cost of building tools around specific operational needs. Customizing Analytics and BI tools is a never-ending game of tweaking and customizing layouts. AI has a huge opportunity to bring conversational updates to these solutions.

The second one, as I have written before, there is an entire spreadsheet layer sitting between many of these systems. Almost every solution on this chart has a spreadsheet that works alongside it to tweak data, prepare information, etc etc. This is ripe for AI custom apps.

The third one I realized quite recently and deserves more attention. Customers, using Agentic AI, to adapt their systems to their own workflows. Most software vendors can’t adapt their products to every customer. Yet every bigger hotel has unique process needs. Using AI agents we could shift a large part of that work to the customer. Using plain language, tell the AI to create the workflow they need.

For example telling your AI Agent that all corporate payments should be routed through a different provider, approved through a specific workflow, and reported in a particular format. It designs the process, you approve it, and the workflow is implemented. Historically, that request (if approved by vendor) would have entered a product backlog and waited years to be developed. Or it would have turned into a spreadsheet automation as in point two above.

This could dramatically accelerate the pace of innovation in our industry. Core systems would continue providing the foundation while exposing more API data and documentation, capabilities etc. Customers would then use AI agents to adapt those systems to their own operational requirements rather than waiting for software vendors to do it for them.

So perhaps the real opportunity for AI is not another category, or another vendor. Instead of forcing hotels to adapt their processes to software, software may increasingly adapt to the hotel.

Which incidentally would make core systems exponentially harder to replace.