Starbucks' Free WiFi is a Big Deal - Here's Why

News flash: I just moved to an office in downtown San Francisco -- woohoo! I love The City, and now I have a chance to be here everyday again. I last worked in SF in 1997.

One thing that has changed since 1997 -- there are a LOT more Starbucks in downtown SF. No duh. There are Starbucks EVERYWHERE in the U.S. -- 6,700 total locations [probably excluding franchisees, such as those in museums and Barnes & Noble].

Now there is going to be reliable, free WiFi hotspots all over urban/suburban America in Starbucks starting July 1.

As soon as I heard this news, I immediately started reconsidering my expensive $60/month broadband wireless card. Yes, it comes in handy when I really need it, but it is becoming less and less necessary as more free hotspots crop up. And if I drop it, with the money I will save, I can always splurge on hotel WiFi when I need to.

But this isn't about me. :)

This is about the larger question of free municipal WiFi -- something that you may remember was touted as a slam dunk by now, but hasn't happened. Why? Because it's harder to do than it looks, and where it is installed, it's largely unreliable.

Now, there's going to be a free, RELIABLE alternative -- Starbucks, and likely the sidewalks right around your closest 'Bucks, and probably around lots of other coffeeshops that will no longer be able to insist that you buy something before letting you use their WiFi. [Not to mention the 11,000 McDonalds that already offer it]

What Starbucks did for lattes -- made them easy to get and reliably prepared -- I predict they are going to do for WiFi.

Brilliant move by Starbucks -- but -- what about the money? Starbucks charges ~$3-4 for a premium cup of coffee, but they are giving away the WiFi -- how's that going to work?

The answer to that is in the second part of their release, about the Starbucks Digital Network. For now, they are talking about the free content that their WiFi users will have access to, but just you wait -- they will figure out ways to separate you from your money through this network, I'm sure of it. And that's how they will make some money on this, while changing the equation of whether you need your own network access service anymore.