Starbucks gives update on wireless rollout

Starbucks' rollout of public access wireless LAN hotspots in its coffee shops is paying off, according to a company executive speaking at this week's CTIA 2003 show in New Orleans.

Wireless LAN, or Wi-Fi, users are staying on average about nine times longer than about 70% of typical customers - 45 minutes compared to five minutes or less. Starbucks considers the broadband connectivity, which is a pay service, a "new line of business," says Ann Saunders, vice president of Starbucks interactive.

How much profit Starbucks expects from this new business was not disclosed.

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Starbucks' rollout of public access wireless LAN hotspots in its coffee shops is paying off, according to a company executive speaking at this week's CTIA 2003 show in New Orleans.

Wireless LAN, or Wi-Fi, users are staying on average about nine times longer than about 70% of typical customers - 45 minutes compared to five minutes or less. Starbucks considers the broadband connectivity, which is a pay service, a "new line of business," says Ann Saunders, vice president of Starbucks interactive.

How much profit Starbucks expects from this new business was not disclosed.

The coffee shop retailer, with wireless operator T-Mobile and HP (systems integrator for the project), outlined usage statistics and user profiles at a press conference this week. Currently there are 2,100 Wi-Fi locations at Starbucks coffee shops in the U.S., with additional sites going up in Britain and Germany. Each store has a T-1 connection to the carrier's net. By year-end, all 2,600 U.S. stores will have wireless access.

In the six months since the rollout began, Saunders says usage is exceeding Starbucks' expectations. Hotspot user typically arrive during off-peak hours. About 30% of the 22 million people who visit Starbucks shops weekly stay on average about 20 minutes. The Wi-Fi users are staying twice as long. Whether that translates into twice as much coffee consumption is unclear.