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Microsoft: Outlook Making Progress Vs. Gmail

With Outlook.com, Microsoft takes aim at Google's search and email dominance. Redmond already claims more than 60 million users, but will more Gmail users defect?
After a six-month preview, Microsoft on Tuesday announced that its Outlook.com webmail service is open for business. The new offering escalates Redmond's attempts to lure users away from Google's email and search products, and to rebrand its consumer-oriented portfolio. Microsoft claims that Outlook.com had 60 million active users by the end of the preview period.

Outlook.com hopes to entice more users with a modern interface that infuses email with social media. By allowing users to hook into Facebook, Twitter and LinkedIn, the service is designed to automatically detect changes to a contact's information and make necessary revisions to the address book. It also allows users to keep tabs on friends' social media activity, such as status updates or new photos, from within the Outlook.com interface. Other features include Sweep, which allows users to clear thousands of messages with a few clicks, and Sky Drive integration that allows users to share media content, including large video files.

Now that Outlook.com is live, Microsoft will begin migrating Hotmail accounts to the new service. The plan has been in the works since the preview period was announced, and Redmond says that users should experience no disruptions as their contacts, emails, folders and passwords are transferred. The transition is slated to be completed by this summer.

Microsoft states that Outlook.com offers 60% fewer ads than competing services, a stat ostensibly aimed at Google. Redmond recently launched an aggressive ad campaign attacking the search giant's handling of user data in generating targeted ads. The official debut of Outlook.com furthers this effort.

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Though Microsoft neglected Hotmail for stretches in the past, the company will enjoy a massive user base once all accounts have been migrated. Microsoft claimed 360 million unique monthly users in July 2011, and if that figure remotely portends the user influx that will soon hit Outlook.com, Redmond will have dramatically increased its webmail presence.

In June, Google announced it had become the world's biggest email supplier with 425 million active users. It's worth noting that analytics firm comScore regularly detects fewer users than either Microsoft or Google has claimed; in December, the most recent month for which data is available, comScore found that Gmail led the field with 306 million users, followed by Yahoo with 293 million and Hotmail with 267 million.

If Microsoft can attract Gmail users, it can eat away at its rival's search empire. Bing has yet to become a meaningful challenger in this regard; according to comScore, Google accounted for 67% of searches in December while Microsoft's search engine accounted for only 16.5%. Yahoo CEO Marissa Mayer, whose company relies on Bing for its search services, has said Redmond's project needs to produce better results.

Microsoft claims that one-third of Outlook's 60 million preview users also use Gmail, suggesting that Microsoft is effectively reaching its target audience. Still, with many users already invested in Google Drive and other facets of the Google ecosystem, it remains to be seen how many users will permanently defect.

Outlook.com appears to be off to a good start, though. According to a post on the service's Twitter account, 1.5 million new users signed up within 12 hours of the official launch.

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