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Starbucks CEO says building ‘fourth place’ online

September 22, 2010

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Starbucks built its business around comfortable cafes that became a ”third place” outside home and work. It now hopes to build a “fourth place” online.

The coffee chain plans to launch its Starbucks Digital Network this autumn. The free service, which is a partnership between Starbucks and Yahoo, will be available to users of complimentary Wi-Fi at company-run Starbucks cafes in the United States and Canada and will give customers a place to share information and find news, music and films.

Content providers include the Wall Street Journal, the New York Times, USA Today, restaurant reviewer Zagat and SnagFilms, which has an advertising-supported library of more than 1,600 documentary films available for online viewing.

“We’ll be a new place for very unique distribution,” Starbucks Chief Executive and Founder Howard Schultz said on Tuesday at a media conference sponsored by TheWrap.com — a celebrity news blog backed by Maveron, a venture capital firm he co-founded.

To that end, he said, Starbucks and SnagFilms plan to co-curate themed film festivals for the network.

The CEO said the network will be a revenue and profit source for the company, but declined to disclose terms of the network’s content agreements.

“This is just the beginning,” said Schultz.

“We’re going to start with the foundation, refine it, tweak it and get it right … I don’t want to commoditize the digital network,” said Schultz, who added that major film studio has express interest in the online project.

While Starbucks does social media better than most major companies — it is widely cited as the No. 1 brand on Facebook and has a huge following on Twitter — that prowess isn’t coming from its CEO, who doesn’t have any Facebook or Twitter accounts.

“I just don’t think that’s for me right now … You’re looking at someone who still has the clock on the VCR that says 12 midnight,” Schultz joked.

“The more important thing is that you still have a VCR,” TheWrap.com Founder Sharon Waxman quipped.

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