Is the end of paying for Wi-Fi near?
By Michal Lev-Ram
You know the feeling: You just ordered your caramel machiatto (extra foam), sat down at a table and opened up your laptop. You log on, hoping to quickly check your e-mail, when all of a sudden a screen pops up asking for your name and credit card information. That’s when you realize that hopping online won’t be as quick — or as cheap– as you’d hoped.
Say goodbye to all of that. On Monday Starbucks (SBUX) announced it was dropping T-Mobile’s (DT)’ s $6-an-hour Wi-Fi service for AT&T, which will provide coffee- house customers with two free hours of Internet access a day. With about 7,000 Starbucks locations in the United States, that’s a major boon for AT&T (T). Now the question is, how long will hotels, airports and other venues be able to continue charging sky-high fees for a service that many people see as essential as running water and electricity.
“This is something that people want,” says Morningstar analyst John Owens. “I think customers will embrace this move.”
Of course, Starbucks’ hopes free Wi-Fi will convince coffee drinkers to not only opt for Starbucks but also to stick around longer and buy more lattes. To log onto the company’s new Internet service, customers will need to have an active Starbucks card.
“This is what customers have been asking for,” says Starbucks spokeswoman Sonja Gould. She says a typical Starbucks Internet customer uses one hour of Wi-Fi a day. The company will begin rolling out the new service at select locations this spring. By end of 2008, it will be available at all Starbucks’ U.S. stores.
When Starbucks first introduced its fee-based Wi-Fi service in 2002, it seemed like a novel idea. But today, when many consumers have become accustomed to getting their Wi-Fi for free, the model seems outdated. Last October the Seattle-based coffee chain began providing free Wi-Fi access for iPhone users to buy music on iTunes.
Put simply, people don’t want to pay for Wi-Fi — let alone deal with signing up for it. That’s why JetBlue (JBLU) has begun testing a free in-flight Wi-Fi service that gives limited online access to its passengers.
Jupiter Research analyst Julie Ask says the Wi-Fi offered in hotels, restaurants, airplanes and coffee shops like Starbucks never needs to be completely unlimited and free. But most consumers — who just want to check e-mail or get a quick read of the news — do expect some form of free access.
“It’s a tool that builds loyalty for companies,” says Ask.
Many of Starbucks’ competitors already offer limited free Wi-Fi. Minneapolis-based Caribou Coffee gives customers a free hour a day. Those who don’t will probably need to if they want to compete.
I’ve never been to the US, so I always assumed Starbucks the world over offered free wi-fi. Well, now I know…
In Malaysia, Starbucks has always offered free wi-fi. In fact, they started a trend. Now just about every other restaurant down the road offers wi-fi.
Kuala Lumpur plans to be a free wi-fi city by end of next year. Singapore has already begun implementing their wi-fi city initiative and the entire island would be wi-fi ready (free) pretty soon.
It wasn’t free in Australia either when I was there last year!
Finally!!!! F%#@in finally!!!
I go to Starbucks because there is one with a nice patio close by. Otherwise I avoid them at all costs due to this cheap@ss stunt of making money through wifi. I guess in the past they could because the sheep went there no matter what but with too many stores and dropping stock price they need revenue. So what if you need a Sbux card, you get one with what, $10 (I dont think it expires) on it and get 2 hrs free every day. What are you afraid you will be tempted to buy coffee if you have the card? So f#$@in what! This is America, nothing is for free. You need to show some kind of commitment otherwise they would have shady cheap@ss losers hanging out in the parking lot downloading all kinds of weird stuff.
Would this also bring about free wi-fi at airports? Imagine transiting through JFK on a trip to London and you need to get a Wi-Fi account by T mobile. Looks like the stoneage seems to hit some of the airports.
Certain locations of Coffee Beans, Java Detour, and It’s a Grind has already been offering free unlimited WIFi. For Starbucks to offer a free 2 hours is not enough plus you need to have a Starbucks card too?
I opted out of going to Starbucks for a Capp. so that I could get FREE WI-FI at Panera Bread Company…now I will have a choice. FREE Wi-FI now dictates where I will dine or even stay. A Cheaper hotel room in Vegas last year was not so affordable after adding WI-FI access to the bill. I will take that into consideration with all my purchases now. Congrats! Starbucks for coming around.
We work near a Panera, caribou and Starbucks. We will have our weekly planning meeting (1/2 hour), take a laptop and vpn in to work. Guess where we never go? Yep, Starbucks since it costs, while Panera and caribou are ‘free’. The eight of us always buy a drink and snack item. Panera and Caribou easily make the cost of having a dsl wireless connection every month just from us.
Caribou Coffee, Panera, Lubestop, Brueggers Bagels and alot of other places all have free WIFI. Some require an email address, most do not. Caribou owners say the $50/month DSL cost is well worth the extra business it brings in, plus all the good will it generates among laptop users. StarRipoff is too late.
Most people will drink about 1 coffee in a 2 hour period. So by the time the 2 hour is up, I would be on my way out rather than buying another coffee and stick around. If it was free all day long, I’d be sticking around and buying more lattes.
It may be ironic, but what I discovered during my trip to Argentina last Christmas is that most of the restaurants and cafes there do have free Wi-Fi for their patrons. I guess it is US turn to catch up on the trend.
Panera Bread has been offering FREE wi-fi for a long time.
I think Sbux has done a great job all around. First let’s remember that although we were paying for their wifi, it was for a service (TMobile) that worked great and in a great location (Sbux). Sbux deservedly made a profit with TMobile but now times have changed and the adjustment has been made. I’d hate to be the account manager for TMobile though! That person or team must be having the worst week of their life. I’m a Sbux fan and a fan of Howard Schultz. Let’s remember that they spend more on health insurance for their part-time workers than on getting the premium coffee beans. What a company!
Its about time. Considering how many other establishments provides the service for free it seems to be a smart move.
Starbucks lost my business years ago because they charged for Wi-Fi and their local competition did not. I won’t go back just because they’ve finally realized it was a mistake. I’ve decided I like the local company’s coffee better, anyway!
Tully’s has unlimited free wi-fi at their locations… not to mention that they don’t roast their coffee to burnt oblivion. I will still frequent Tully’s and other independent free wi-fi coffe shops over SBUX.
What does this mean for iPhone owners who have AT&T accounts? Do they automatically get free wi-fi on their phones, or do they need to get a Starbucks card?
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I never did like Star@3$@ucks . Coffee crap and high price and no free wifi in the past . The bloom is past even with free wifi .