Corporate Governance

Starbucks and the Internet

By J Robert Brown Jr.

We have written a number of times on this Blog about Starbucks.  Our main thrust was that to profit maximize, the Company should place greater emphasis on social responsibility.  It is our belief that coffee drinkers will pay a bit more if they know some of the money is going to socially responsible causes.  Certainly, Starbucks has toyed around with this idea.

Our other recommendation was free Internet.  To get the Internet for free at Starbucks, you had to have a card registered with the Company and then you got only two hours.  Otherwise, you had to pay.  Given the free nature of the Internet in many places, not the least of which is the case in other coffee shops (in Denver, Caribou, for example, offers the Internet for free), it certainly discouraged some laptop lumbering coffee drinkers from heading to Starbucks.

Well, it turns out that the Company is planning to provide for free Internet (apparently without the need for a loyalty card) in a majority of its outlets.  The catalyst?  Not other coffee shops but McDonalds, which is now offering free Internet at many of its 11,000 outlets.  It is an overdue step that will benefit shareholders and coffee drinkers. 

Full post as published by The Race to the Bottom on June 18, 2010 (boomark / email).