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T-Mobile is suing Starbucks for marketing a new Wi-Fi service with AT&T, charging the coffee giant with breach of contract.
T-Mobile claims that Starbucks agreed not to advertise Wi-Fi services from AT&T in its stores in any given market until the entire market had switched its stores from T-Mobile to AT&T. T-Mobile had an exclusive deal to provide Wi-Fi in Starbucks stores, dating back to 2002, but earlier this year Starbucks signed a deal with AT&T to take over the Wi-Fi service in the coffee shops.
However, Starbucks and AT&T have begun marketing a new Wi-Fi service in all Starbucks stores, even though so far stores in only two markets, Bakersfield, California, and San Antonio, Texas, have fully switched to AT&T, the lawsuit alleges.
On June 3, when Starbucks launched the promotion that offered two hours of free Wi-Fi access from AT&T in its stores to users of a new affinity card, so many people tried to sign up that they overwhelmed Starbucks' Web site, the coffee company said.
As part of a transition agreement, T-Mobile and AT&T also agreed to provide Wi-Fi services to each others' existing customers in coffee shops, without charging each other for the access, the lawsuit says. But Starbucks started advertising the new Wi-Fi service through AT&T on a nationwide basis, and since T-Mobile still operates the bulk of the coffee shops, T-Mobile is currently offering access to users of the new promotion without compensation, it said. "Since T-Mobile provides the resources and equipment to support Wi-Fi services in non-transitioned stores, it is T-Mobile alone that is bearing the cost and burden associated with this 'free' Wi-Fi offer," it said in the filing.
T-Mobile is claiming loss of revenue and reputation due to the new promotion, and is looking for damages and for Starbucks to comply with its agreements with T-Mobile.
Starbucks did not answer a request for comment on the allegations in the suit, but offered the following statement: "Our goal is to ensure Wi-Fi access at all Starbucks locations. This is a benefit offered to our Starbucks Card Rewards members as well as AT&T subscribers and steps are being taken to ensure that this access continues."
AT&T did not respond to a request for comments on the suit, which was filed in the Supreme Court of the State of New York.
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Comments (1)
So much for all of themBy Anonymous on June 10, 2008, 2:18 pmI think they are all fast and loose. I don't see much of a reason to do business with any of them, unless you are committed to using the iPhone. But there is always...
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