I know, it's a bit late to answer, anyway.
I am just a traveler, but i totally agree with Footprints and its saying: "You have to respond to the market and the market is demanding fast internet access in the hostels." As a traveler, i need wifi in the hostel ! in order to avoid to spend some time in a wifi-pub during the day, while i could visit the city.
I realize it also have quite a bad effect on people. i have been in Several hostel with wifi, and saw different behavior. Putting computers and wifi in common areas/living rooms... social rooms seems to me a bad idea, people won't interact, meet others travelers as well as they could without wifi in this kind of room.
Wifi in bedrooms, seem to me even worse! Yes, it is great, i would love to have wifi on my own bed. But i won't leave the bedroom to see what is happening and who is outside! And someone will certainly disturb some travelers by night.
At last, the best experiences i had, wifi was (twice) in the hallway, between the bedrooms and the common area (well arranged of course), a place where people are going through. You do not disturb anybody, people didn't stay a lot of time on their computer except some inconditionals. And quickly re-joined / went back to the "social" room. Often, travelers see you and invite you to join them in the social room, which help a lot to quit internet! and if you're like me (wish is maybe not easy to be! ;) ) you won't feel good to stay on the net, facebook or mail... seeing people leaving the hostel for night life, joining friends to the social room.... enjoying their trip. You will fell like you're not living you trip as you could, and you will maybe, hopefully close your laptop in order to live the moment.
The computers were all on the same table, i had a great and funny friendship with the guy that was next to me. But still, it's better to play a game with people while drinking a caipirinha! ;)
The "pay service" with a "free time of 1 hour", is a great idea, and was used in one of the hostels i have been to... but cannot say more about that.
Anyway, hope my message is not too usefull. It was my first message on this website after several months reeding all kind of post.(i am happy!!!)... happy anniversary to it!