Prediction: Starbucks Wi-Fi will soon be free

The for-pay Wi-Fi model at Starbucks feels old and stale, says Mike Elgan

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Starbucks, the giant coffee chain with 13,168 locations worldwide, was a pioneer in rolling out wireless Internet access for customers. Along with partners T-Mobile and Hewlett-Packard, the company offers Wi-Fi for those who pay either a one-time connection fee or a monthly fee for all the Wi-Fi you can handle.

When Starbucks introduced for-pay Wi-Fi in 2002, it seemed like a great deal (especially for business customers who could expense it). But five years later, the model appears old and stale and ready for a complete overhaul.

Prediction: Starbucks will start rolling out free Wi-Fi access within one year.

In fact, Starbucks is already offering free Wi-Fi, in a way. If you want to use iTunes with your iPhone to buy the music you hear being piped over the Starbucks speakers, you don't need to pay for a T-Mobile account to do so.

The arrangement is part of a larger effort by Starbucks to use its Wi-Fi connectivity for other kinds of revenue. Providing free Wi-Fi so customers can buy things from Starbucks online makes sense as a sustainable revenue mode.

Pitched battle with McDonald's

The other reason Starbucks wants its Wi-Fi to be free is that competitors are starting to do it. Starbucks is, in fact, locked in a pitched battle with McDonald's for the lucrative morning commute breakfast crowd.

In the past two years, McDonald's has been offering upscale coffee -- even espresso drinks -- and testing a Starbucks-like concept restaurant called McCafe, of which there are now 500 worldwide.

In response, Starbucks started testing what could only be described as "Egg McMuffins" and "downscale" food products like Krispy Kreme doughnuts.

The most recent shot by McDonald's across Starbucks' bow is a rollout of free Wi-Fi at all U.K. restaurants this week. This will prove to be a real draw, especially as iPhones and iPod Touches and similar Wi-Fi devices proliferate around the world. People will really want free Wi-Fi as they sip their McCappuccinos. I expect McDonald's to gradually roll out Wi-Fi at restaurants in other countries -- including in the U.S.

Unsurprisingly, coffee drinks at Starbucks are super profitable. By making Wi-Fi free, Starbucks will be able to counter the lure of free Wi-Fi at McDonald's and not miss out on the real money -- the sale of coffee.

Well, that's my prediction. I'll report back one year from now -- or when Starbucks makes Wi-Fi free, whichever comes first.

Biggest ever digital photo frame announced

Digital photo frames, those electronic mantle-top picture viewers that look like regular picture frames, have been around for years. But they've all suffered from a common problem -- they're too small. A typical frame might show the equivalent of 6- by 4-in. pictures. Not very exciting.

But today, PhotoVu announced its new PV2265w, a 22-in. widescreen LCD picture frame.

The frame pulls digital photos from an optional USB hard drive or from any USB flash drive and displays them on a 16:10 wide format screen. The frame features Wi-Fi support, built-in software and Internet photo sharing, according to the company. You can even customize the frame and matting.

It's not cheap, though. The PV2265w will set you back $1,299.

Mobile mouse is also a GPS gadget

Business travelers are wise to seek out small, light and converged devices, to minimize the number of items to pack and carry.

The new $100 Deluo MouseGPS is perfect for laptop-carrying road warriors who want GPS capability while traveling. The mouse has a GPS receiver built in. The data flows through the collapsible USB cable -- two peripherals in one. The MouseGPS is powered entirely through the USB cable as well, so no batteries are required.

My picks: It will be a Merry Christmas, indeed

At the beginning of this year, Toshiba notebooks with HD-DVD capability were priced at $3,000. Don't look now, but such systems will cost less than $1,000 in time for Christmas. And Samsung has unveiled some interesting new phones.

Mike Elgan writes about technology and global tech culture. Contact Mike at mike.elgan@elgan.com or his blog, The Raw Feed.

Copyright © 2007 IDG Communications, Inc.

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