While Airlines Add More Fees, One Travel Freebie Becomes Standard

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Travelers will pay all-time high fees to hotels and airlines this year. In this atmosphere, it’s a surprise when any part of the travel experience is granted for free.

Few airline travelers would dream of getting free wi-fi — or free anything — from an airline. And yet free wi-fi at airports is rapidly becoming the standard.

Dozens of major U.S. airports boast free wi-fi, including those in Boston, Los Angeles, Denver, San Jose (Calif.), Seattle and Phoenix, as well as smaller gateways such as Dallas-Love. Baltimore-Washington added free wi-fi over the summer, and it’s heading to Atlanta in 2013.

(MORE: How Airline Fees Screw Over Travelers Who Don’t Pay Them)

After much complaining from travelers, the Minneapolis–St. Paul airport will have free wi-fi service by the end of the year. Currently, wi-fi is available for $7.95 per day at the airport, reports the Minneapolis Star-Tribune, which consulted a travel expert for an explanation of why free wi-fi is becoming so widespread at airports:

“I think it’s getting very close to the point where no airport can charge for wi-fi,” said Joe Brancatelli, editor of Joe Sent Me, a business travel website. “These people just think wi-fi is in the air. They can’t conceive of a place where there is no wi-fi, and they don’t want to pay for it.”

As recently as 2010, a Minneapolis–St. Paul spokesman told USA Today that free wi-fi service simply wasn’t feasible:

“We know many travelers would love to see free wi-fi,” says airport spokesperson Patrick Hogan. “The bottom line is that airports like MSP must generate the funds to cover all airport operating costs … There is no such thing as free airport wi-fi. It’s really just a question of who pays to cover the cost of providing the service.”

(MORE: As Airline Fees Top $36 Billion, Is Relief in Sight for Fee-Weary Travelers?)

So who exactly is covering the costs of “free” wi-fi at airports today? Typically, providers such as Advanced Wireless Group (AWG) and Boingo use a tiered business model to generate revenue, in which all travelers have access to free basic wi-fi for a limited time (45 minutes or so) but must watch a sponsored ad before the session begins. A faster, unlimited, ad-free premium version of the service is available to those willing to pay for it.

Even though the premium service costs a mere $3 to $4, the vast majority of travelers go with the free option. After all, they’re typically just sending off a last-minute e-mail or double-checking a hotel reservation. But even as free wi-fi would appear to be less lucrative for all parties involved, there are good reasons for airports to extend a relatively cheap amenity like wi-fi to its customers. As AWG CEO Scott Phillips wrote in an industry publication:

Think about this, the airport patrons are enjoying a resource provided by the airport, while at the same time they are sitting amongst a host of other high-end amenities presented by the facility. This comfort to travelers, along with the concept of surfing the Web from the airport without paying, can translate directly to high customer satisfaction scores.

(MORE: Quirky Marketing: Airline CEO Calls His Customers ‘Idiots’)

When customers are happy, they’re more likely to spend money — in this case, at airport shops and restaurants. They’re also more likely to return to the airport.

All of which might bring up the question, Why is it that airlines can’t (or won’t) offer at least some access to free wi-fi on planes? Wouldn’t that result in highly satisfied customers who’d be more likely to fly with the airline again and help business in the long run? Well, yes. You’d think so. But considering how airlines have been pushing fee after fee onto customers, it seems as if they’ve collectively agreed that they don’t have to put much effort into making customers happy. The cheapest up-front fare is what matters most to passengers; see the struggles of Virgin Atlantic as Exhibit A.

There is another reason airlines have a hard time offering free onboard wi-fi to passengers. The truth is that it’s much cheaper to establish wi-fi at an airport. “Many companies are able to tap into existing airport infrastructure to provide terminal wi-fi, as compared to providing an ad hoc system for the airplanes,” Steve Burke, AWG’s director of airport acquisitions, explains. “It comes down to the difficulty of implementing the necessary infrastructure to support a model like this one along with the high costs associated at this time.”

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RashedChowdhury
RashedChowdhury

Earlier this year, when travelling from Montreal to Vladivostok, I used free wifi at both Montreal-Trudeau Airport and Sheremetyevo Airport in Moscow along the way. I was very surprised to not find free wifi at JFK Airport, though. There's no reason why New York should be behind Montreal and Moscow in providing basic services to travellers.