Indie coffeehouses tell Starbucks: Bring on your free Wi-Fi

Computerworld - Like many indie cafes, Seattle's Bauhaus Books and Coffee has long relied on free Wi-Fi to help bring in customers.

"In the evenings, the whole bar along the window will be lined with people using their computers," said Grace Heinze, a 13-year manager at Bauhaus, located between downtown Seattle and the trendy neighborhood of Capitol Hill.

Bauhaus has thrived despite all of the Starbucks shops that have popped up around it: 15 within half a mile, and 38 within one mile.

So is Heinze worried that the fiercely artsy cafe, named for the 1920's German art movement and replete with memorabilia, might lose customers to Starbucks now that it is dumping its high Wi-Fi rate — $6 an hour, or $10 a day — in favor of two free hours of Wi-Fi a day to any customer?

Not really.

"People come here because they like our atmosphere and because they like our coffee," Heinze said. "We're not feeling very uptight about this."

On Monday, Starbucks announced that it will replace longtime Wi-Fi partner T-Mobile with AT&T at its 7,000-plus coffee shops.

Anyone holding a Starbucks Card — whatever the value remaining on it — is eligible for the two free hours of Wi-Fi. Cards can be bought online for as little as $15.

"This is great news for consumers," said David Blumenfeld, senior vice president at Wi-Fi directory provider JiWire Inc. "Wi-Fi at Starbucks just became a lot less expensive, and I expect many more people to take advantage of it."

An additional two hours of Wi-Fi costs $3.99, while a monthly membership that gives access to any of AT&T's 70,000 hot spots worldwide costs $19.99 per month.

Meanwhile, the 12 million AT&T customers subscribing to a DSL package faster than 1.5Mbit/sec. will get unlimited access for free at Starbucks, in addition to the free access they already get at many McDonald's and Barnes & Noble stores.

AT&T is the largest Internet service provider in the U.S.

"I think it's safe to assume that given Starbucks' ubiquitous presence, offering free Wi-Fi could be a significant acquisition channel for AT&T with this deal," Blumenfeld said.

Small chains and indies

Still, until several years ago, many cafes were granting access to their Wi-Fi hot spots through codes given only to paying customers, according to Jack Kelley, president of Seattle regional chain Caffe Ladro.

There was the fear "that if public Wi-Fi was free, you'd fill your place up with 'campers,' " Kelley said, referring to patrons who linger all day without buying anything.