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Microsoft Corporation (MSFT)’s Outlook Takes Aim at Google Inc (GOOG)’s Gmail

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SAN FRANCISCO (AP) — Microsoft Corporation (NASDAQ:MSFT) is so confident it has the Internet’s best email service that it is about to spend at least $30 million to send its message across the U.S.The barrage begins Tuesday when Microsoft’s twist on email,, escalates an assault on rival services from Google Inc (NASDAQ:GOOG), Yahoo! Inc. (NASDAQ:YHOO)AOL, Inc. (NYSE:AOL), and a long list of Internet service providers.

As part of the process, all users of Microsoft Corporation (NASDAQ:MSFT)’s Hotmail and other email services operating under different domains such as will be automatically converted to by the summer, if they don’t voluntarily switch before then. All the old messages, contacts, and settings in the old inboxes will be exported to Users will also be able to keep their old addresses.

Microsoft Corporation (NASDAQ:MSFT)Email remains a key battleground, even at a time when more people are texting each other on phones.

People still regularly check their inboxes, albeit increasingly on their smartphones. The recurring email habit provides Internet companies a way to keep people coming back to websites. It gives people a reason to log in during their visits so it’s easier for email providers to track their activities. Frequent visits and personal identification are two of the keys to selling ads, the main way most websites make money.

That’s why Microsoft Corporation (NASDAQ:MSFT), Google Inc (NASDAQ:GOOG), and Yahoo have been retooling their email services in recent months.

After keeping in a “preview” phase since July 31, Microsoft is ready to accept all comers.

To welcome new users, Microsoft Corporation (NASDAQ:MSFT) is financing what it believes to be the biggest marketing blitz in the history of email. will be featured in ads running on primetime TV, radio stations, websites, billboards and buses. Microsoft expects to spend somewhere between $30 million to $90 million on the Outlook campaign, which will run for at least three months.

The Outlook ads will overlap with an anti-Gmail marketing campaign that Microsoft launched earlier this month. The “Scroogled” attacks depict Gmail as a snoopy service that scans the contents of messages to deliver ads related to topics being discussed.

The Gmail ads are meant to be educational while the Outlook campaign is motivational, said Dharmesh Mehta,’s senior director.

“We are trying to push people who have gotten lazy and comfortable with an email service that may not be all that great and help show them what email can really do for them,” said Mehta.

By Microsoft’s own admission, Hotmail had lost the competitive edge that once made it the world’s largest email service. The lack of innovation left an opening for Google Inc (NASDAQ:GOOG) to exploit when it unveiled Gmail nearly nine years ago.

Gmail is now the industry leader, although estimates on its popularity vary.

Google Inc (NASDAQ:GOOG) says Gmail has more than 425 million accountholders, including those that only visit on smartphones and other mobile device. The latest data from research firm COMSCORE, Inc. (NASDAQ:SCOR) , which doesn’t include mobile traffic, shows Gmail with 306 million worldwide users through December, up 21 percent from the previous year. Yahoo’s email ranked second with 293 million users, a 2 percent decrease from the previous year, followed by Hotmail at 267 million users, a 16 percent decline from the previous year.

Microsoft, which is based in Redmond, Wash., is counting on to catapult the company back to the top of the email heap. During the preview period, Outlook attracted 60 million accountholders, including about 20 million that defected from Gmail, according to Microsoft. Comscore listed Outlook with 38 million users through December.

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