Why stay at the conference hotel?
Because it's the center of conference activity, that's why!
There are always conference attendees in the lobby and public spaces, so it's much easier to network at the conference hotel. In the morning, it's a quick trip to meeting rooms, and later in the day it's just as quick to nip back to your room for a break. You'll have a better conference experience in the conference hotel!
That's obvious. But there are other reasons that you need to consider before you look at another hotel.
The conference leaders have taken their role of finding a conference site very seriously. They looked at a number of locations, and they considered the needs of the attendees as well as the need of the conference for meeting spaces. The result of their search is a comfortable conference venue with quality service and support for workshops, tutorials, plenary sessions, etc.
However - as the quid-pro-quo for that service and support, the conference must guarantee that a percentage of attendees will stay in the hotel. By making this commitment, the conference gets discounted rates on costly meeting room rental fees, audio/visual services, catering and other services, and can offer lower registration rates for the conference as a whole.
To get those conference attendees to stay in the conference hotel, the hotel generally offers a room rate that is discounted from their normal room rate. These room rates are negotiated between the conference and the hotel, based on the number of expected conference attendees and the meeting space required to comfortably accommodate them. The contract with the hotel then guarantees that specific numbers of sleeping rooms will be purchased each night by conference attendees. This complex negotiation of meeting room space, functions and events (with food), and sleeping room provides the most value per dollar for the conference and those attending it.
Once this commitment is made, enough conference attendees must stay at the conference hotel to meet the contracted numbers and justify the discounts the conference received on meeting rooms and other conference services. Put another way, if the conference does not meet the contracted sleeping room commitment, it has to pay for those rooms anyway. This penalty of paying for unfilled rooms can cost the conference thousands of dollars. Furthermore, without a history of filling the sleeping rooms, the next conference in the series cannot negotiate as favorable a hotel contract, which can result in increased registration fees for future conferences.
Of course, as everyone knows, on some occasions one of the many Internet providers, or even the hotel itself, may offer rooms at a lower price than the conference is offering. There are often restrictions and penalties associated with these rates, but if not and you somehow obtain a better rate than the one offered by the conference, your stay will still be counted toward the conference's required room block.
The bottom line is that staying at the conference hotel gives you a better conference experience AND helps keep registration rates low. So...please do your part - support the conference by staying at the conference hotel!