Starbucks, coffee and music

Last night, every Star­bucks store in the United States closed at 1730 local time for a three-hour train­ing ses­sion. See this New York Times arti­cle about the train­ing project.

I’ve writ­ten a long arti­cle, so you might want to get com­fort­able and find a tasty beverage.

The company’s CEO, Howard Schultz, wants Star­bucks to return to its roots: mak­ing excel­lent cof­fee bev­er­ages, slowly. But Star­bucks is work­ing harder than ever to turn its miik-and-coffee shops into WiFi-enriched media lis­ten­ing lounges. It’s a plan that’s rife with assump­tions about how the dig­i­tal con­sumer enter­tains themselves.

Star­bucks’ fas­ci­na­tion with recorded music has never made much sense to me, because most fast food chains try to max­i­mize cus­tomer turnover dur­ing the day. Serv­ing cus­tomers faster should mean addi­tional rev­enue per hour. A cor­po­rate playlist, slow ser­vice and comfy chairs should have the oppo­site effect.

Then again, most fran­chised burger joints don’t have mer­chan­dise dis­plays on the floor. Star­bucks stores do, and I often won­der who buys these items. If the ser­vice will be slower, and the com­pany is return­ing to its roots, why doesn’t Star­bucks remove the dis­plays so that more cus­tomers could stand in line?

In the end, Star­bucks wants its cus­tomers to spend more time in the store. It’s a core piece of the company’s strat­egy. If these cus­tomers have the means to afford a lap­top com­puter or an iPod, they might buy a dessert or an extra beverage.

If at first you don’t succeed…

A few years ago, Star­bucks exper­i­mented with CD burn­ing kiosks in a few stores. Here’s some arti­cles from Busi­ness Week in 2004 and KioskNews in 2006 about this dubi­ous idea. I loved Howard Schultz’s quotes from the 2004 arti­cle – he was an enthu­si­as­tic cham­pion of he projec.t Cus­tomers rarely used these sta­tions, which housed a touch-screen Hewlett-Packard com­puter that helped users assem­ble their own playlists from an inven­tory of dig­i­tal music. The ser­vice was slow, and the prices were about the same as itunes and other online mer­chants. The few cus­tomers that tried the kiosks usu­ally fig­ured out that they could burn their own CDs at home.

A recent New York Times arti­cle dis­cussed an updated ver­sion of the media kiosk. Instead of a disc, cus­tomers would insert a USB mem­ory stick. The pay­ment and trans­fer process could take any­where from a few min­utes to an hour, depend­ing upon the qual­ity and size of the files involved. Flash mem­ory trans­fer can be slow, after all.

The Star­bucks kiosk project was designed to induce cus­tomer to try down­load­ing dig­i­tal music. The kiosks could hold between 250,000 and a mil­lion songs on their hard dri­ves. Baris­tas aren’t known for their com­puter trou­bleshoot­ing skills, how­ever. When the kiosks mal­func­tioned, cus­tomers could not get assistance.

Last year, Star­bucks decided to wel­come Apple as a part­ner. After all, iTunes is the dom­i­nant dig­i­tal music ser­vice in the USA, as I pointed out yes­ter­day. There’s a legion of iPod users who already use iTunes at home to down­load music and videos.

Serv­ing up slow cof­fee and fast downloads

It makes sense to ditch the kiosk and its lim­ited inven­tory, and offer the entire iTunes inven­tory in each Star­bucks. But video files are much larger than audio files, and Apple keeps adding more con­tent to the iTunes store every day. Cus­tomers might be more likely to view and buy dig­i­tal media at Star­bucks if the down­load speeds are as good or bet­ter than their res­i­den­tial Inter­net connection.

Star­bucks had to develop a way to offer the entire iTunes inven­tory with­out exces­sive band­width costs and slow down­load speeds. TUAW.com reported ear­lier this month that Star­bucks may be installing edge servers in its stores. This type of server stores or caches con­tent at the edge or end of a net­work, to give users faster access to files and ser­vices. An edge server is a good way to reduce band­width demands and man­age latency by stor­ing pop­u­lar audio and video files inside the Star­bucks store itself.

Dur­ing the day, AT&T WiFi cus­tomers would use the WiFi access point at that Star­bucks store to receive and buy audio and video con­tent from Apple’s iTunes Store. Con­tent would be saved to cus­tomers lap­top com­put­ers, mobile phones, iPhones and iPods.

Pop­u­lar audio and video files, includ­ing new releases, this week’s TV shows and best-sellers would be stored on the store’s edge server, so the user would receive their files at WiFi speed, instead of a much slower trans­mis­sion from AT&T’s GSM mobile net­work or a remote server on the store’s broad­band connection.

The edge server would receive fresh con­tent late in the evening, based on local usage pat­terns and mar­ket­ing plans, while the store is closed and band­width is less expen­sive. So Star­bucks stores in Hon­olulu would prob­a­bly get more Hawai­ian music and “Lost” episodes on their edge servers, while Star­bucks sites in Texas would store more coun­try music and NASCAR high­lights in their edge servers.

What’s the cache?

Aka­mai Tech­nolo­gies uses a sim­i­lar approach to cache or store web appli­ca­tions, web pages, audio, video and other con­tent in its global con­tent dis­tri­b­u­tion net­work net­work, and iTunes does use Aka­mai ser­vices. Yahoo, CNN, Slide and the NBA also use Aka­mai servers to mir­ror con­tent for their web sites. Akamai’s net­work is designed as a cache for any Inter­net user, regard­less of their con­nec­tion. I dis­cussed Aka­mai and latency on 6 June 2007.

Akamai’s net­work, and sim­i­lar net­works run by com­peti­tors, help Web pub­lish­ers reach mil­lions of users per day by mir­ror­ing con­tent. I’ve never had this prob­lem on billso.com, but it’s pos­si­ble that some­day my lit­tle web server will be swamped with requests from thou­sands of users for the same arti­cle. Don’t worry, billso.com has a cache fea­ture that I can acti­vate if I need it, so I don’t exceed my monthly band­width allocation.

The iTunes store inven­tory is placed on mul­ti­ple servers located in major pop­u­la­tion cen­ters, and con­nected to sev­eral fast Inter­net con­nec­tions. Web retail­ers use these same net­works to han­dle heavy shop­ping days like Mother’s Day and Black Monday.

Surf­ing on the edge is very akamai

Con­tent dis­tri­b­u­tion net­works can also help remote loca­tions with large Inter­net user pop­u­la­tions. Hon­olulu is a great exam­ple. It makes much more sense for Hawai­ian Tel­com and Oceanic Time Warner to cache audio and video con­tent on Oahu than to han­dle thou­sands of transoceanic requests for the same files. See my dis­cus­sion on 7 June 2007.

The Wikipedia page for Aka­mai has some basic infor­ma­tion, and links to addi­tional arti­cles and resources, includ­ing this 2006 Busi­ness Week arti­cle, a 2006 arti­cle from SeekingAl­pha, and this MIT video – there is a play link above the photo on that page. The video is about an hour long, and it requires RealPlayer. It’s a great dis­cus­sion of how an aca­d­e­mic research project can be com­mer­cial­ized, but there’s a lot of tech­ni­cal jargon.

Tagged as: Apple, audio, bandwidth, broadband, GSM, Internet, iPhone, iPod, latency, music, network, research, Starbucks, storage, video, Yahoo