False advertising in LaGuardia

En route to Boston the other weekend, I was hoping to get some work done during my layover in LaGuardia. Rather than finding unlimited free Wi-Fi as I’d been expecting, I discovered that only the first 30 minutes were free. As a cash-strapped college student, I decided I’d do what I could offline and then connect for the 30 minutes if needed. When I finally connected to the free network, I was unable to access anything. I wasn’t entirely surprised, given the amount of traffic that LaGuardia must see on a typical day – 38,000 through Delta’s two terminals alone, according to this estimate.

It later dawned on me that this was an example of private markets acting to more efficiently allocate a public good. While free Wi-Fi is not a pure public good, it is non-excludable and as non-rivalrous as the capability of the server allows. Public Wi-Fi is non-excludable because there is no password and/or price, thus anyone nearby can connect. However, public Wi-Fi is not purely non-rivalrous. The speed of the network will slow down as more people connect, inhibiting the ability of those already connected to “consume” the Wi-Fi. With only one public network, users who are scrolling through Facebook and Instagram constrain the ability of those trying to utilize the network for work. When one considers the individual utilities of such proxy groups, SMC probably exceeds SMB. Thus, by imposing a cost to access Wi-Fi beyond 30 minutes - and an even higher cost if you want extra high-speed internet - the market allocates the good more efficiently. Thanks to this market mechanism, I was able to write a cover letter in record time. I wasn’t about to shell out $10+ knowing that I’d likely end up being the mindless millennial scrolling through her social media feeds.

What I would’ve tweeted @LaGuardia airport had I decided to pay: being able to connect to but not actually utilize a wireless network does not constitute “free Wi-Fi.”