Yahoo Revamps Mail Service

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Yahoo Inc. is redesigning its email service to help stem a user decline and counter offerings from longtime rivals Microsoft Corp. and Google Inc. as well as social-networking services such as Facebook and Twitter.

 

The planned changes to Yahoo Mail, part of a project codenamed "Minty," are aimed partly at increasing the speed of the service in overseas markets where Internet connections are slower than in countries such as the U.S.

 

Yahoo is also changing the look of the service to resemble the simpler design of the email app that is downloaded on mobile devices such as Apple Inc.'s iPad or phones that use Google's Android software. The updates to the email service are expected to roll out this fall.

 

Yahoo executives earlier this year mentioned the planned redesign to financial analysts and application developers, a company spokesman said, but the project received little attention.

 

"We continue to innovate our product experiences, and specific to Yahoo Mail, we have been previewing our next version of email that provides higher performance, sleeker design and great integration" with social-networking services such as Facebook, a Yahoo spokesman said.

 

Yahoo Mail is the No. 1 Web-based email service in the U.S. with 97 million unique visitors in August more than Google's Gmail and Microsoft's Hotmail combined, according to research firm comScore Inc. But that figure is down from about 107 million visitors in August of last year.

 

Worldwide, Microsoft still commands a large lead over Yahoo and Google with 355 million visitors in July, up 3% from the same period last year, according to comScore data. Yahoo had 281 million visitors in July, down 7% from a year earlier. Gmail is rising fast, growing by 22% to 185 million visitors in July.

 

Yahoo also faces a tough battle in important markets such as India, where Gmail took the top spot several months ago and in July had 24 million visitors to Yahoo's 21 million, according to comScore.

 

"Yahoo Mail is an incredibly important part of Yahoo," said David Karnstedt, a former Yahoo executive who is now chief executive of Efficient Frontier, which manages online ad spending for marketers. "Not only does mail drive a ton of user engagement but it accounts for the majority of the available advertising space in Yahoo's network," he said.

 

Email services generate advertising revenue and help providers promote other services, such as Web search, which are bigger drivers of ad revenue. Yahoo's rivals have been steadily upgrading their own offerings; Google, for instance, added the ability for Gmail users to make video calls directly from the program, assuming they have computers with video cameras and microphones.

 

Yahoo Mail also has been threatened by the rise of mobile devices powered by Google's Android software and often preloaded with Gmail. In the second quarter of 2010, Android grew to become the No. 3 smartphone operating system in the world behind Symbian, which is used by Nokia Corp. Yahoo has a partnership with Nokia to pre-install Yahoo Mail and chat applications on some of its phones.

 

Another factor is the rapid rise of social-networking sites such as Facebook, which offers its users the ability to send direct messages to friends and family. And Twitter, the microblogging service, also is rising in popularity as people use it to share links and write short messages to other users.

 

Hoping to keep Facebook users from leaving its email service, Yahoo earlier this year introduced a way for users to integrate their personal Facebook content with Yahoo Mail and the Yahoo.com home page, among other Yahoo sites.

 

Facebook content often consists of photos shared between users. Project "Minty" is in part aimed to help Yahoo Mail users manage photos they receive and share with others, in part by including elements of Yahoo's Flickr photo-sharing and editing program.

 

Source: Amir Efrati