Email Wars

Hotmail has now jumped on the mega-storage bandwagon, lead by GMail (1 GB free) and followed by Yahoo! Email (100 MB free), and is offering 250 MB of storage to its free email users (and matching the Yahoo! offering of 2 GB for $20/month). However, Hotmail and Yahoo! Email’s free offerings are still far behind GMail’s groundbreaking 1 GB which I think is a mistake (as previously discussed here).

What I really don’t get is why it took so long (and a move by an email newcomer – Google) for Hotmail and Yahoo! to make this move? For years they have had people dealing with 2 MB and 4 MB of storage and now all of sudden, in a matter of weeks, they are all able to offer hundreds of megabytes for free. I know it’s a matter of survival since GMail dropped the gauntlet, but one of the other guys should have gotten there first. Talk about a missed opportunity.

However, Google may have missed something here too. GMail is still in beta and not available to the general public, but Hotmail and Yahoo! Email are. GMail set the pace by announcing their forthcoming 1 GB free email offering, but with the other guys increasing their offerings before GMail launches, they have a chance to retain more customers and in the meantime, pick-up many new ones. In retrospect, Google should have beta tested GMail with much less storage and announced the 1 GB at the time of launch. Granted, it would have generated less buzz during the beta phase, but they would have had a real surprise advantage over the competition at the time that matters most – when everyone can sign-up.