Looking Beyond Coffee, Starbucks Seeks a New Digital Future

Starbucks today announced that it will provide free wireless access in all U.S. company-operated locations starting July 1. And this fall it will launch the Starbucks Digital Network, a partnership with Yahoo that will provide customers free unrestricted access to pay sites such as the Wall Street Journal. Additional content providers in the new, in-store network offering include iTunes, The New York Times, Patch, USA TODAY and ZAGAT.

Starbucks previously offered Wi-Fi access to both registered Starbucks cardholders as well as AT&T customers. But while many have tried, wireless access by itself is no longer enough to differentiate a company’s services and woo customers. By leveraging premium content relationships, however, the new Starbucks Digital Network offers a significant value-add. It’s a clever move, and a forward-thinking one in terms of content — much like Barnes & Noble’s enabling of access to free e-book reading on the Nook device while in the store for an hour a day.

I’ve been considering an iPad subscription to the Wall Street Journal, but find it a bit too pricey for my tastes. However, I do frequent Starbucks locations on a regular basis already, and I just might turn my occasional Starbucks visit into a daily one if — just like when someone leaves a copy of the paper behind — I can read the Journal there for free.¬†Of course, Starbucks wins big in this situation by combining premium information with its retail locations as the longer I’m in the store enjoying additional content and a wireless connection, the more likely I am to buy a beverage or a bite to eat.

From the consumer side, I see much to like. I’m wondering however, how such new strategies will begin to affect Wi-Fi network companies like Boingo. I currently pay $9.95 a month for Wi-Fi access on the Boingo network, which includes Starbucks locations as well as some hotels and airports. Without the added benefit of premium content, Wi-Fi network providers could face a challenge they didn’t see coming from a pipe that isn’t dumb.

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