What Starbucks Can Learn From the Movie Palace
Starbucks became the most visible Wi-Fi-equipped national chain in the US when it began offering the service in 2002. Now, at more than 5,100 stores, Starbucks offers Internet access "from the comfort of your favorite cozy chair."
Before you pop open your laptop, however, you need to pull out your credit card. Starbucks and its partner, T-Mobile, charge $6 an hour for the "pay as you go" plan.
Macdonalds offers Wi-Fi in more than 8,000 of its 13,700 stores in the United States, giving it wider reach than even Starbucks, and it also charges for access. McDonald's doesn't charge as much: it asks $2.95 for two hours.
In the 1920s, when air-conditioning began to be installed in movie theaters, owners had to spend a sizable sum - $50,000 (roughly equivalent to $570,000 today) - to transform the property into a "cold spot." But it was worth it. Before the "refrigeratory process" came along, theaters could not draw customers during the summer because of the unbearable heat in confined space. With air-conditioning, patronage increased so sharply that even the largest investments were quickly repaid.
Wi-Fi does not address a similar problem of seasonal attendance. Nor will it produce a multifold increase in patronage. But, then again, it's not nearly as costly to introduce as the cooling plants of the 1920s.