From today’s New York Times: Starbucks is switching WiFi providers. After a 6-year deal with T-Mobile, the milk-and-coffee merchant will offer WiFi access through AT&T. The arrangement gives AT&T 17,000 WiFi access points throughout the US, vaulting the telco to the number one spot in the country. AT&T has 70,000 WiFi hot spots worldwide.
AT&T has added mobile subscribers through its iPhone deal and other initiatives, while T-Mobile has struggled to keep pace. However, AT&T will allow T-Mobile customers to use the Starbucks hot spots free of charge, through a roaming agreement. This should appease some T-Mobile subscribers who used Starbucks hot spots.
Starbucks card users will receive a free 2 hour WiFi session each day. Additional time on the wireless network starts at US$4 for 2 hours. AT&T broadband subscribers already had free access to AT&T hot spots as of last month.
Starbucks benefits by gaining access to AT&T’s larger mobile subscriber base. Other users will have a new reason to get and use a Starbucks card. Enhanced wireless access means that Starbucks customers might stay longer, and buy more items during their visit.
Chains like Starbucks often use a single national vendor for telecom offerings such as WiFi, to reduce security issues, consolidate reporting, and provide consistent services and branding across locations.
They won’t be buying breakfast sandwiches, though.
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Glenn Fleishman of TidBITS has posted an excellent article that supports my customer lock-in hypothesis.
Fleishman also notes that iPhone users will need WiFi’s speed when downloading movies and TV shows to their phones. GSM, the mobile phone technology that is used by AT&T and the iPhone, is too slow.
Glenn estimates that a 2 hour movie would download in about 9 minutes on a fast WiFi connection, compared to an hour or more with AT&T’s fastest GSM connection.
He also has some nice information about AT&T’s pricing model for WiFi customers.
Glenn claims that the Starbucks sandwich ovens are being removed to accommodate more coffee-making equipment behind each counter.
According to Engadget and this press release, the rollout starts 1 May 2008.
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