How AI is charging hotel guests $500 for using a hairdryer

Don’t be surprised the next time a hotel tries to add on a hefty fee for smoking in a non-smoking room – even if you don’t light up. Experts say the integration of artificial intelligence by the hotel industry is leading to unintended outcomes. 

AI-powered sensors used to detect smoking, for example, are producing false positives that could trigger fines as high as $500.

Jordan Hollander, co-founder of Hoteltechreport.com, a website that aids hotels in finding new technologies, told CNBC that guests using a hairdryer or aerosol spray have been hit with the charges after AI sensors inaccurately detected smoking in their rooms.

“It’s not hard to imagine how that could go south quickly,” Hollander said.

Humans still decide whether a fine is deemed to be legitimate. 

“For now, the AI is acting more like a very observant assistant than a judge and jury,” Hollander said.

Hotel tech on the rise

Hotels are increasingly using AI to flag issues, such as “a room that smells off, linens that don’t meet standards or maintenance problems,” Hollander said.

“Between computer vision that can detect damage or wear in a room, and AI that analyzes guest behavior or room conditions in real time, the tech is already there,” Hollander said.

Hotels, Hollander believes, are trying to strike a balance that allows for the use of AI systems without alienating customers. The increasing reliance on automation, however, could cause issues if guests aren’t able to easily dispute false positives.

“There’s a risk of backlash if hotels start billing guests based solely on what an algorithm says,” he said. “The moment a guest gets a charge and can’t get a straight answer about why or how it was verified, you’re in dangerous territory.”

There’s also concern that AI systems could make “guests feel like they’re being watched or nickel-and-dimed by a machine,” Hollander added, which would completely undermine the customer-business relationship.

Daniel Keller, CEO of cloud infrastructure company Influx Technologies, believes AI integration in its current form is nothing more than a trend that will be quickly rebuked by consumers.

“This particular use of AI doesn’t increase efficiency; it scrutinizes customers of small-margin service businesses looking to suck extra money out of guest experiences,” Keller told CNBC.

Travel industry expands AI use

Hotels aren’t the only businesses utilizing AI.

The car rental company Hertz is using the technology in select locations to scan vehicles for damage. But it’s apparently not finding much. Questioned about the potential for aggressive billing practices, a Hertz spokeswoman told CNBC that of the more than 500,000 vehicles scanned for far, more than 97% showed no billable damage.

“For years, vehicle damage inspections have caused confusion and frustration,” the spokeswoman said. “The process was manual, subjective and inconsistent, and that isn’t good enough for our customers or our business.”