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Free, unlimited Wi-Fi policy begins at Starbucks
Mikio Nakazato takes advantage of the free Wi-Fi offered at a Starbucks on Central Avenue at 2nd Street in downtown Los Angeles. (Gary Friedman, Los Angeles Times / July 2, 2010)
By Kristena Hansen and Andrea Chang, Los Angeles Times
July 2, 2010
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Ted Thompson, a civil engineer from Santa Clarita, likes his coffee without Internet.
But sitting in a downtown Los Angeles Starbucks, he worried that there might not be much room for him in the chain's shops in the future.
"You won't be able to find a place to sit down anymore if more people are coming in to use their computers," said Thompson, 70. "I thought a coffee shop was for drinking coffee."
On Thursday, Starbucks Corp. instituted a free, unlimited Wi-Fi Internet policy for patrons at its nearly 6,800 company-operated stores in the U.S., plus 750 locations in Canada.
Some competitors beat Starbucks to it. Six months ago, McDonald's Corp. launched free Wi-Fi at about 11,500 U.S. locations. The companies have been butting heads ever since McDonald's debuted its McCafe line of coffee drinks a year ago, typically at lower prices than at Starbucks.
Even before the free Wi-Fi policy some customers spent hours in Starbucks shops with their laptops, taking up the tables and chairs. The Seattle company doesn't have a policy regarding how long a person is allowed to stay, even if he or she doesn't purchase so much as a "tall coffee" (despite the name, the smallest size offered).
The new free, unlimited Wi-Fi program could bring in more of those folks.
"This is a double-edged sword," said Eli Portnoy, a Los Angeles brand strategist who stopped going to Starbucks months ago because it was always "littered with laptops."
"It's going to get worse," he said. "But I feel they think it's a no-win situation, that if they don't offer prime amenities that they're going to be at a loss."
Even if it irks some customers, Starbucks could reap financial rewards from coffee drinkers who stay longer and buy more drinks to fuel marathon Internet sessions.
"People are squatting, sure, but they're buying," said Brian Rosen, a retail consultant at Chicago business consulting firm ROCO Partners. "Starbucks didn't come to this altruistically for the good of the people â€” what it does is increase sales."
Larry Nash, 49, who was tapping away at his laptop Thursday morning at the Starbucks in West Hollywood, proved the point. He'd just finished drinking two venti (the biggest size) drip coffees.
"It's the best free office space in town," the Hollywood musician said. "If you sit here and actually do a full day's work like I do, you'll end up buying a lot more product than you would if you just came in.
"I mean, I literally have breakfast and lunch here."
Some independent coffee shops ended up regretting free Wi-Fi for customers.
Three years ago, Mireya Jones, owner of Jones Coffee Roasters in Pasadena, began offering no-cost Internet. The people it attracted did not always keep buying drinks.
"People had their offices set up in here," said Jones, who has owned the shop for 17 years. "I kept thinking, 'If you don't get out I'm going to have to start charging you rent!' "
She eventually switched to a policy that gave a free half-hour of Internet with purchase, but pulled the plug on it completely six months ago.
Adam Brotman, vice president of the Starbucks unit that oversees the company's digital ventures, said that before the new policy began the average user of Wi-Fi in company shops spent an hour there.
"We don't see these statistics changing significantly," he said. "It's something we'll be keeping an eye on."
On the first day of the new policy, the Starbucks in Little Tokyo was crowded when Tait Reimers, 31, arrived.
"It definitely has the potential to ruin that classic experience of sitting down and having a cup of coffee with somebody because you can't find a seat," he said.
But in that regard, he was as much a cause as a victim. Reimers, who described himself as an eco-entrepreneur, was working on his laptop in the shop to send e-mails, voice chat via Skype and write a project proposal.
"I mean, look at me," he said. "I'm here sitting alone at this whole table working on my computer with an 11-hour battery and zero intention of leaving."
Big deal. In a lot of Asian countries it's been around for years. In the Philippines, the MacDonalds have WI FI. It just comes naturally in this part of the world. Doesn't Singapore have a city wide WI FI?
And why cant people in the US just carry wireless modems?
A brain is a terrible thing to wash!
It's nice to have WiFi but if you can't find a seat in one of the coffee shops it's going to be very annoying for all those customers that want to just sit for a bit. If someone comes in and expects to take up a seat for 5 hours while purchasing only 1 coffee I think that that could create some issues for the people without laptops and netbooks. I know I would start getting my coffee elsewhere.