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Starbucks Ditches T-Mobile USA, Goes With AT&T As New WiFi Partner

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AT&T said today that it will start providing WiFi to more than 7,000 company-owned Starbucks in the U.S. ditching the long-standing partnership Starbucks had with T-Mobile USA. The two companies will offer both free and paid services. Beginning this spring, Starbucks Card holders can use two hours of free Wi-Fi service a day at Starbucks, and if you are one of AT&T’s 12 million broadband or AT&T U-verse customers, you’ll have unlimited access. AT&T said it already offers 17,000 U.S. hot spots in the U.S. and more than 70,000 globally. Release.

Different plans: In addition to free access, customers will be able to purchase tiered access to the AT&T Wi-Fi network at Starbucks: two hours for “just” $3.99; monthly subscription for $19.99 includes access to any of AT&T’s 70,000 hot spots in 89 countries. Starbucks “partners”—ie employees—will get free access.

Upgrade: AT&T is upgrading Starbucks’ network with more bandwidth and redundancy.

Availability: The market-by-market rollout starts this spring and is expected to be completed by the end of the year.

Common denominator: Starbucks and AT&T have Apple (NSDQ: AAPL) in common. AT&T, of course, partners with Apple on the iPhone while Starbucks and Apple launched an iTunes partnership late last year. Ken Lombard, president of Starbucks Entertainment, singled out iTunes in his comments about the deal allowing Starbucks “to expand and enhance the range of digital entertainment experiences for our customers as well as our partners, including the continued rollout of the iTunes Wi-Fi Music Store…”

Wi-Fi Networking News: “It turns AT&T from ‘McDonald’s plus,’ with a relatively small footprint of other locations, to a 15,000-location giant.”

Update: In a statement, Joe Sims, VP and GM of T-Mobile’s Broadband Products and Services, said: “T-Mobile HotSpot customers can continue to access Wi-Fi services at Starbucks now and for years to come.  T-Mobile HotSpot customers also will continue to benefit from our commitment to be the innovation leader for consumer Wi-Fi.  We are still the only national wireless carrier that is actively expanding the use of Wi-Fi in homes through our innovative T-Mobile HotSpot @Home service.”

In an updated statement, T-Mobile said: “The Wi-Fi network operations transition will not begin until later this year. Even after the transition, T-Mobile HotSpot and HotSpot @Home customers will continue to experience seamless Wi-Fi access at Starbucks locations for at least the next five years under a roaming agreement between T-Mobile USA and AT&T (NYSE: T). There will be no additional charge for T-Mobile HotSpot and Hotspot @Home customers at Starbucks…Our primary focus was to ensure minimum customer impact before, during and after the transition period. T-Mobile remains committed to providing the public with exceptional Wi-Fi access and related services.”

AP: “Current T-Mobile HotSpot customers, who pay anywhere from $6 per hour-long session to $9.99 for a day pass to $39.99 a month for unlimited access, will get Wi-Fi access at no extra charge through an agreement between AT&T and T-Mobile.”

More to come.

Feb 11, 2008 10:21 AM ET

Posted In: Companies, AT&T, T-Mobile

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