The economics of free wifi

I’m writing this post on the no longer free wifi service offered by East Coast trains.

I travel from Leeds to London a fair amount and have always been very pleased with the service. It’s been on time, clean and offered free internet access.

The internet was always patchy but it was free so who could complain.

However, on connecting today I was told that it was now only free for 15 minutes and I would have to pay £4.95 for an hour or £9.95 for 24 hours (+ the free 15 minutes!) The reason for this apparently was that they’d had comments about the patchy service and so made improvements to the service that meant they needed to charge.

This is perhaps all very well if it were true but having paid my £9.95 the service was notably no different to how it used to be. In my 2 hour journey I was disconnected no fewer than 20 times! Each time required 30-45 seconds of hitting refresh before it came back to life. So, not exactly value for money.

If you consider the economics of the move it’s also difficult to see how the pricing works. Even the 1 hour cost is higher than the daily rate on a pay as you go 3G card. I for one will just be getting a sim for my laptop rather than using the on train service again.

So the end result is:

a) one less incentive to like/choose East Coast over another operator
b) very little new extra income for them

This doesn’t seem like great economics to me.