We stayed here for two nights in January after a lovely cruise down the Mekong from China. The location is great - walking distance to everything, but in a quiet area overlooking the Mekong. The room was large with a balcony over the Mekong. The staff was friendly, spoke English well enough, and were quite helpful. Breakfast was in an outdoor front porch - very pleasant. There are Wats nearby, and a short walk to where the two rivers meet. The room was a little "tired," but comfortable with a good bathroom and shower.

It is quiet, in town with a view of the river and near the main wats. The staff is friendly and helpful. It is clean and the verandas are charming. Lodging in Luang Prabang can be hard to come by at times. If you have your heart set on one of the more higly rated and expensive hotels and can't get a room, if you can get a room here, you won't be disappointed. Nor will your wallet. Only problem - just slightly run down, Please do not read that as unclean, just not 5 star brand new, which is part of the charm.

Calao Inn is an old nice house in a good position that was probably restored about fifteen years ago with a poor taste and as cheaply as possible, than it was abandoned to its destiny, and so it feels.
Rooms are fairly large but dirty. Linens are good quality but stinky and dirty looking. Bed spreads haven’t been washed for a long long time. Mattresses smell urine. Curtains live their own lives.
Bathrooms are just dirty and more hospitable to large insects and pests than to humans.
The restaurant closed down some time ago (so should the Hotel if the owners’ greed was not so big).
Breakfast is cheap, served on tablecloth covered with plastic. In plastic is also served the yogurt sometimes with a bit of mould.
The poor staffs seem recruited on the street just for the day: nobody knows anything; they clean the floor and serve food at the same time. In Laos hiring good staff is very inexpensive, people are usually very kind and helpful, but the staffs at Calao Inn look lost. They do not speak any other language than Lao –other than a rude man that comes in the morning to cash the bills- and they have no idea of their job.
Prices are out of market both for the room and for the service. Some of the nicest places in town cost less (ex. The Apsara, a hip hotel just two minutes walk); and a clean and nicely restored guesthouse cost one third! (Luang Prabang is full of newly restored hotels and guesthouses that meet all the demand for rooms). We booked because we were arriving late at night and we did not feel to search around, but if you cannot book anything online or on the phone, it is worth it to come and look around: accommodations are very abundant and affordable.

We stayed at the le Calao for four nights in January, 2005. The view
from our upstairs room overlooking the Mekong River was great.
The Inn is in a quiet neighborhood about a half mile from "downtown"
Luang Prabang. The staff is friendly and helpful and the food is good
too.