Yahoo will increase the storage capacity of its free and fee-based web-based e-mail services.
The free service will see capacity increase from 4Mbytes to 100Mbytes, while users of the fee-based service will get 2Gbytes.
In addition, Yahoo is simplifying pricing for its fee-based e-mail service, which is called Yahoo Mail Plus. The service will cost $19.99 (£11) a year. This represents a discount for all subscribers who had paid $29.99 for 25Mbytes, $39.99 for 50Mbytes and $59.99 for 100Mbytes.
The increase in storage will be rolled out globally by the end of the year. The new price will be available to subscribers when their existing annual agreement ends.
"We're announcing these improvements to our service, with a refreshed user interface and a storage increase. Our goal is to provide a full-featured service, and now we've taken storage off the table. People don't even have to think twice about it," said Terrell Karlsten, a Yahoo spokeswoman.
Limited storage in web-based e-mail services has been a headache for many users, who see messages sent to them get bounced back if their inbox is full. This forces users to constantly delete messages from their inbox to make room for incoming ones.
But in April, Google rocked the market when it announced it was developing a free web-based e-mail service called Gmail with 1Gbyte of storage capacity.
Gmail still is not generally available, but Yahoo's move is a clear reaction to the imminent arrival of that competing service, said Marcel Nienhuis, an analyst at The Radicati Group.
By responding to Google's move with this increase in storage, Yahoo will give a good enough reason for most of its existing users to stay put and not move over to Gmail, he said.
"Anything above 50Mbytes is plenty of storage, so providing 100Mbytes for free is very generous and pretty attractive. Most users will be very happy with it," Nienhuis said. "The 2Gbytes for the fee-based service is pretty much unlimited storage for all practical purposes."
Yahoo is also announcing other enhancements to its e-mail services including:
a redesigned user interface for both services;
- for users of the free service, an increase in the maximum size of a single message from 3Mbytes to 10Mbytes;
- an improvement in the back-end system powering the search function of the two e-mail services, which should result in faster query results; this search feature is an existing one, and lets users search the full-text and subject lines of the e-mail messages in their inbox by keyword;
- the availability of 50 million e-mail handles or names that had at some point been claimed by users but that have been dormant for years;
the removal of all graphical ads from the fee-based service; these ads will continue to exist in the free service; the only ads that will appear in the fee-based service will be text-based ads promoting Yahoo offerings only
Users in the following markets will receive the redesigned user interface and the increase in free storage to 100Mbytes: US, UK, Ireland, France, Germany, Spain, Italy, Argentina, Mexico, Brazil, Hong Kong, Singapore, Australia, New Zealand and South Korea.
Juan Carlos Perez writes for IDG News Service