Some analysts are predicting the demise of the Internet cafe with the advent of Wi-Fi: In the U.K., an Internet cafe chain called Easyinternetcafe, has changed its model from building standalone Internet cafes to adding Internet cafe capabilities to existing venues. The phenomena of Internet cafes vs. hotspots is really a complete reversal, according to one analyst. People don't have to find a new place to get Internet access which happens to also sell coffee, like they did with the Internet cafe. Now they go to the same place they got coffee, which happens to have Internet access via Wi-Fi.
Internet cafes never became super popular in the U.S. Still, I think they'll survive around the globe, especially where tourists hang out. Internet cafes have been a blessing to me in remote places where I wouldn't dream of phoning my friends, because the cost would be outrageous, but sending emails with tales of travel has been ideal. Internet cafes will always be ideal in places where it's likely that people won't have their own laptops.
On an interesting side note, the head of The Cloud comments in this article about how expensive Wi-Fi access is. He said that The Cloud is signing up some big name companies that plan to sell access for far less than the going rate. He also predicts that within 18 months most bars, restaurants, and cafes will be giving Wi-Fi away as a tool to attract customers. [link via Gigaom]