Starbucks Drops T-Mobile For AT&T

stoolpigeon writes "Ars reports that Starbucks is replacing T-Mobile with AT&T as their Wi-Fi provider. AT&T broadband customers will be able to access the service for free. Starbucks card users will get 2 hours a day free. 2-hour, daily, and monthly rates will be lower than they were with T-Mobile. Starbucks says that their previously announced deal to tie in with iTunes will continue under AT&T. For now AT&T isn't offering free Wi-Fi to iPhone users, but says it expects to accommodate them soon. Quoting the article: 'The companies didn't specify exactly when the rollout would begin, only saying that it would take place this spring... [The company plans] to install all new equipment at Starbucks as part of this agreement, so the changeover won't be as simple as flipping a switch.'"

Comments

Hooray?

[Arclight17]

If I want wireless while I'm out and about, I go to Panera or a local cafe that offers it for free....
So BFD if it changes!
I use http://www.wififreespot.com/ to find free wifi when I'm away from home. (No, I don't work for them or get money for it :)

Re:Hooray?

[ScentCone]

If you RTFA, you'll see that people who use one of those Starbucks cards at the register (which you can fill by dropping some cash in it once in a while) will get 2 hours of no-extra-charge WiFi while they're there. Sure you can be a parasite at Panera without buying anything, but it's fairly bad form. Starbucks will get clobbered on bandwidth, but they'll sell some more coffee, and they'll earn a little interest on the $5 everyone will have sitting on those pre-loaded cards.

Re:Hooray?

[gad_zuki!]

>Sure you can be a parasite at Panera without buying anything,

You might find the definition of parasite to be interesting when it comes to coffee shops.

I read a study (or perhaps a well written rant) about how places that offer unlimited wifi tend to do much, much worse than places that dont. Why? Because people will turn a table into their office and fill up all the seats, thus providing a big disincentive for people to actually go in there and drink coffee and buy a baked good.

I live in a major city and I can picture all the free-wifi places in my neighborhood and I absolutely hate them all. Theyre all packed with kids/students who are myspace addicts and your 9-5'er doing work. There are no free tables. And the best part is that these people are there ALL DAY and I'm sure barely spend 10 dollars, if that. In fact the big free wifi place here recently went out of business. I dont know how they stayed in business. You had 15 people there taking all the seats for hours and buying a 3 dollar product!

So it turns out that if you want to stay in business and sell coffee you need to not turn your shop into a laptop hangout. Even starbucks knows this. They can easily foot any bandwidth cost but they would know their shop would turn into a 'business center' in no time and that will hurt them badly in the end. Instead they want you to buy product and get the hell out. If you need wifi its there but you'll need to pay. Interesting that they are going with the starbucks card approach.

Interesting stuff. Panera suffers from this but your typical panera is much larger than your typical starbucks and all the noise doesnt make it conducive to getting things done like a coffeehouse does.

Re:Hooray?

[Zemran]

any coffee shop worth spending any time in already has free wifi.

I am sitting in the coffee shop of the art gallery in Chiang Mai, northern Thailand, using the free WiFi... Where is Starbucks? (O.K. we have got SB here but who needs it?). As you say, every decent coffee shop now has free WiFi...

Re:Hooray?

[aclarke]

There are two schools of thought for eating out. Let's call them the American way and the European way.

In the American way, you sit down, eat your meal, get your bill, and leave. The wait staff is there to get you what you want, and mostly to do it quickly. "Moving tables" is encouraged, and most Americans don't like or want to sit down and wait a long time for anything. They are there to eat, and to get out.

In the European way, you sit down, are brought what you want, and are not pressured for what you want to do next. Your next stage of the meal may not come for another half hour, but that's OK because you are there to enjoy your afternoon or evening, and enjoy your time with family and friends. You may sit down after the meal with a coffee or glass of port, and not be asked anything by the wait staff for maybe 45 minutes, unless it appears that you want more of something. You certainly will not be brought your bill before you ask for it, as the wait staff does not want you to feel that you are being rushed out the door. That would not be relaxing.

When I spend a bit of time in Europe and then come back to North America, I find the attitude in most restaurants, even "higher end" ones, to be rushed and not that relaxing. When my steak is arriving 5 seconds after I'm done my salad, it just doesn't feel right. On the other hand, if you are used to that, and you go to a "European" style restaurant, you may feel like it's too slow and people aren't attentive to your needs.

Your commentary was responding to poor service. When you ask for your bill and it takes 15 minutes to get it, that's poor service. The grandparent was referring to feeling rushed when they're in a restaurant in North America. That's not "good service", that's just being rushed. But it's what most Americans (including you, most likely, and that's just fine) want, so that's how most restaurants are. It's what I want too, when I'm in a rush :-)

You're missing the real story...

[ntimid8]

The main reason for the switch is that virtually every executive at their Seattle headquarters wants or already has an iPhone and they want the corporate discount.

Ties in very nicely for AT&T DSL customers

[Fencepost]

For quite a while AT&T has offered access to their network to their DSL customers for $2.99/month, but recently they announced that they were dropping that to "free for our DSL customers." So, in addition to McD's, Barnes & Noble and some other locations, you can now get effectively free access at Starbucks as well.

Handy, that.

If I was still paying $20/month to T-Mobile this'd sure be the end of it. What's left in their network besides Borders bookstores?

Headline is completely wrong

[PitaBred]

According to TechDirt at least. Seems they're just going to allow a choice, rather than replace T-Mobile with AT&T. But why let the facts get in the way of a good headline...

In the "So What" School here

[rijrunner]

Honestly, I was not even aware that there were still wifi coffee shops that you had to pay for internet access. Is that a Bay Area thing? In the Fort Collins CO area, most coffee shops I have been around have free wifi with no time limits.

Seriously.. small shops have been doing this for years. DSL is down in the $20/month range and a wireless router is cheap. I suspect that the administrative overhead of managing a system like this one for Starbucks is not really worth the effort. Starbucks may have made their money on the T-Mobile deal, but I doubt it. IIRC, it was a $500 mill contract. And, a quick websearch shows a series of price cuts.

Here's one from 2003:

http://www.wi-fiplanet.com/news/article.php/1855971

"In the original story regarding the price drop, Starbucks New Ventures Director Lovina McMurchy is quoted as saying that even the busiest Starbucks shops get about 20 Wi-Fi devices on the network per day. While T-Mobile doesn't release cost information for providing the hotspot, the revenue generated from so few customers is probably not enough to cover costs of a high speed line -- the T-Mobile Hotspots are served by costly T1 lines -- and the revenue sharing between T-Mobile, Starbucks, and HP, which provides some software for the services."

http://www.lockergnome.com/mobile/2006/03/09/t-mobile-answers-the-cries-of-starbucks-owners/

"All the mom-and-pop coffee shops offer free Wi-Fi. In fact, most everyone does except Starbucks. The Seattle-based coffee house gets its hotspot piped in by T-Mobile. It's been reported for years that store managers at Starbucks has been complaining to upper management for a while about losing business because customers don't want to pay for their Internet after forking out $4 on a foo-foo drink."

Here's my favorite:

http://www.forbes.com/2007/02/23/fonbucks-wifi-starbucks-ent_cx_mc_0226fonbucks.html

"FON, a community WiFi provider headquartered in Madrid, Spain, is offering wireless Internet access to Starbucks' latte-sipping surfers for just $2 a day--versus the $10 users pay to sign onto the 5,100 T-Mobile hotspots at U.S. Starbucks (nasdaq: SBUX - news - people ).

Just how does FON plan to steal away Starbucks Internet users? By offering FON wireless routers, also known as "La Foneras," free to anyone who lives above or next to a Starbucks. The routers, which usually cost $40, split an Internet broadband connection into two wireless signals--one for personal Internet use and the second for public use, which can be accessed by anyone within range for $2 per day. The routers' owners get to pocket half of the sign-on fee, and FON takes home the rest."

Re:Headline is completely right

[node 3]

No, TechDirt is absolutely wrong.

From Starbucks:
In recognition of the many T-Mobile customers who enjoy visiting Starbucks, the Company is also announcing that T-Mobile HotSpot customers will be able to continue to access Wi-Fi services at no additional cost, through an agreement between AT&T and T-Mobile.

T-Mobile's hardware and network are being removed, and AT&T's are being installed. What's happened is AT&T and T-Mobile have a deal (probably at Starbucks' behest) to allow T-Mobile customers to access the AT&T hotspots in Starbucks.

But why let the facts get in the way of a good headline... Indeed...