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October 01, 2003

The Death of Pay-As-You-Go Wi-Fi

Can we all just declare pay-as-you-go Wi-Fi dead? A press release from Panera Bread:

Panera Bread Company (Nasdaq: PNRA), the company that has led the nationwide trends of artisan bread and quick casual/specialty foods, today announced it is in the process of equipping its bakery-cafes from coast to coast with free Wi-Fi (wireless fidelity) access.

"This is not a test, but represents a serious and real long-term commitment," said Ron Shaich, Panera Bread chairman and chief executive officer. "Panera is the first national chain to take substantial steps forward in meeting growing consumer demand for highspeed Internet access without charging for the service."

Approximately 70 Panera Bread and Saint Louis Bread Co. locations, including those in the Chicago, Detroit, Jacksonville, St. Louis and Washington, D.C., markets, already offer free Wi-Fi access. At least 60 additional locations will be wireless by the end of this year. Plans are underway to equip all remaining company-owned bakery-cafes and participating franchise locations across the country with the free service. The company expects that as it continues to expand, it may eventually operate in excess of 1,000 hot spots.

Not only is the service free, but they offer free support as well:

Call the Panera Wi-Fi Help Desk at (866) 943-4457 from 9:00am to 9:00pm Eastern Time, 7 days a week. The primary purpose of the Help Desk is to ensure the network is up and running in each of our Wi-Fi enabled bakery-cafes, and to answer basic questions regarding configuration.
Let's see... I can go to Starbucks (well, actually, the closest Starbucks is a few miles away) and pay for each drink while paying for my Internet access, or I can go to Panera Bread and get free refills on my coffee or soda (including the Nectar of the Gods, Caffeine-Free Diet Coke) while surfing the Web for free. Yep, it's going to be Panera Bread from here on out.

As I noted before when Schlotzsky's Deli announced a similar (though not as comprehensive) program, this is how to use Wi-Fi: as a marketing tool, not as a profit center. Panera sticks to doing what it knows best (serving food and drink) and uses inexpensive technology to lure more people into its restaurants.

Soon, enough retail establishments will adopt free Wi-Fi that the pressure on those already operating pay-as-you-go networks will be irresistable, and everyone will go free. I don't know when this will happen, but I believe that when it does, it will happen fairly quickly -- say, no more than six months from the first major conversion (to free access) to the general realization that pay-as-you-go is dead, because no major bricks-and-mortar operation offers it on a widespread basis.