Hi, I'm Gmail. And I'm Hotmail. I have one gigabyte of storage, which means I don't have to keep deleting my emails.
Well, don't you think that deleting your emails can be rather therapeutic? Sure, buddy. I can also use keywords to search quickly through my email.
How about you? Well, I keep my favorite emails in a folder. Like, uh let's see here, somewhere.
Another moment here, sorry. Hey Hotmail, good to see you again. Hello, Gmail.
Looks like I have 1. 5 billion users now. How about you?
Well, just want to clarify, my name is Outlook now. And let's see, I have a few hundred million users, but it's not a popularity contest, is it? No, of course not.
Gmail is really dominating that market for consumer email, which is a bit odd because in most mature markets you have an oligopoly of at least three players, but it looks like Google is absolutely dominating this market. With 1. 5 billion users worldwide, Gmail is now the most widely used email provider in the world, but it was by no means the first.
When Gmail launched in April of 2004, it became one of a number of free email services alongside Hotmail and Yahoo Mail, which were some of the first to introduce web-based email in the 1990s. By 1998, Yahoo Mail already had 12 million active users, and by 1999, Hotmail had about 30 million active members. The Gmail project came out of something called 20 percent time, and this was something that was really a hallmark of Google culture in the early days.
So 20 percent time works like this. If the rest of your time, if you took that one hundred percent and devoted 20 percent of it to a project that you were interested in or excited about or passionate about or wanted to chase down, that's what you could do. And Gmail came out of that 20 percent time.
Paul Buchheit started working at Google in 1999 as its 23rd employee. He undertook creating Google's foray into the email world as his 20 percent project. At the time, the project was codenamed "caribou," an allusion to the popular comic strip Dilbert.
But not everyone at Google was supportive of his vision. Even though we know Gmail's so big and the most used email service, it almost didn't happen because there were so many arguments among executives about whether they should actually pursue it. And it wasn't quite clear how Google could benefit from an online email service when they were a search company.
One of the things that Google did was they looked at problems as projects. So they put things to what they called a toothbrush test. So if you were interacting with a problem as much as you interact with your toothbrush, then they were excited to take that on.
And email certainly fit that bill because people used it all the time and it was growing during this time. For something that was use all the time, email in the early 2000s was still not very user-friendly. The first thing Gmail set out to improve was storage.
At the time, other email providers offered up to 4 megabytes of storage. What that meant was you had to delete, delete, delete all the time or your storage would be full. And then if your parents or an employer sent you an email, it was bounced back.
And the next thing you know, your phone is ringing and someone is saying, 'I'm trying to email you and I can't get through. ' So that was the first thing that they were going to address by offering one gigabyte of storage. This effectively meant that you would never have to delete email again.
And this was revolutionary at the time. So when Gmail first released its product, it didn't even have a delete button. And this was to bring home the point that you didn't ever have to delete an email.
Ever! Gmail's other big improvement: search. Google offered that signature, clutter-free look that you saw with the Google homepage in Gmail.
They also took a look at using their search engine feature as a part of the email so that if you wanted to find a specific email that someone sent you on a specific topic, it was easy. You just used the search bar to find it. And at the time, no one else offered that.
Besides storage space and search, Gmail also introduced a way of grouping messages that many of us consider standard today. Conversation threading grouped all replies to a message in one place and in order, making it easier to grasp the context of a conversation. That was what Google was all about, whether it was the search engine or Gmail, they wanted to make it easier for the user.
When it was easier for the user, more people bought in and adopted this new technology. What gave Gmail some of its capabilities was the fact that it used a more advanced computer language called JavaScript. What JavaScript delivered was a much more interactive and responsive experience for the user compared to the competition, which was reloading each page, repainting each page, and it was a slower process.
And so JavaScript delivered a much faster and more interactive experience for the consumer. Gmail was launched in 2004, on April 1st. It was April Fool's Day.
So people actually thought it was a hoax and it wasn't real, but it was. Gmail initially launched in a unique manner: as invite only. The reason why Google, which turned out to be a wonderful marketing ploy, made it exclusive and you had to apply and try to get on the wait list for a Gmail account is because they weren't investing enough.
They couldn't scale up the back end to meet demand, and so they had to make sure that they were able to keep up with the flow. And the only way they could do that is to let people in on invitation only. Gmail's invite only rollout made having a Gmail address a hot commodity.
Some even went as far as selling their Gmail invites on eBay. It wasn't until 2007 that Gmail finally launched to everyone without an invite. Since about 2012, Gmail has been doing exceedingly well compared to the competition.
At Google I/O 2012, the company announced that Gmail had reached $425 million monthly active users. This put it ahead of Hotmail's self-reported 360 million monthly active users and Yahoo Mail's estimated 277 million users in 2011. At the time, there were some disputes about the exact numbers, but soon Gmail's popularity became evident.
In a written statement to CNBC, Senior Director of Project Management for Yahoo Mail, Josh Jacobson, said, 'Gmail has seen user growth for a number of reasons, including promotion as the default email provider on Android devices and familiarity driven by use in the enterprise and education via Chromebooks. ' The main factors that have led to the rise in popularity of Gmail. First of all, Google is a central property on the web and so there's a halo effect.
And so you go to Google for YouTube and you go for Google Apps and for search and for maps. Why not go for email? Gmail went from being an underdog to the most used email service in the world because it was able to incorporate a lot of Google's core technologies.
Another example of one of our core products, which we are redesigning with A. I. is Gmail.
We just had a new, fresher look for Gmail, a recent redesign. Hope you're all enjoying using it. We are bringing another feature to Gmail.
We call it Smart Compose. So as the name suggests, we use machine learning to start suggesting phrases for you as you type. All you need to do is to hit 'tab' and keep auto completing.
Some of Gmail's more recent innovations include the ability to schedule emails and Confidential Mode, which prevents recipients from forwarding, copying, printing or downloading your message. Though they are still able to screenshot it. Another draw: being able to use your Gmail sign in on other websites and apps.
When we look at 'sign in with,' I mean, this is where we talk about the competition between the digital dragons. And so you can sign in with Facebook, you can sign in with Amazon, you can sign in with Apple. And so the fact that you can sign in with Google allows them to compete head-to-head with those other digital dragons.
And the fact that you can use Gmail or Google to sign in really reinforces the power of their control of that consumer email market. We also see their presence in the education space as leading to pull through when folks select a consumer email address. And then, momentum builds more momentum.
And so as you get tired of your old ISP-based email and you're embarrassed about your AOL email account, you look around and you look at what your friends are using. And if they're gonna be using Gmail, you may tend to move over to Gmail yourself. They started off as a very innovative product and they've continued to innovate.
Gmail was gaining popularity fast, but it was not all smooth sailing for the new platform. Finding a way to monetize Gmail had been a point of contention at the company. Some people argued Gmail should be a paid service from the get-go.
But others argued that in order for Gmail to have the most reach, it needed to be ad driven. The ad revenue model won out, but even before it launched the general public in 2007, Google got heat for scanning Gmail emails and using the contents for targeted advertising. If you're emailing someone about, hey, let's meet up and go sailing, and then suddenly there was an ad for sailboat tours.
It was unnerving for people because it was so spot-on and people called it creepy and spooky. And suddenly the headlines were very negative for Google and for Gmail. The practice also made some privacy groups and politicians uneasy.
The year Gmail launched, 31 privacy and consumer groups sent a letter to Google's co-founders saying that scanning emails for ad purposes, 'violates the implicit trust of an email service provider. ' Shortly after Gmail's launch, former California senator, Liz Figueroa, even drafted a bill that would place limits on the information gathered from scanning email messages that could be shared with third parties. The bill passed the California State Senate, but died in the state Assembly.
It would take another 10 years after its wide public launch for Google to commit to no longer scanning any Gmail account for the purpose of personalizing ads. When we asked why it took 10 years for the company to stop scanning emails for ad purposes, a Google spokesperson emailed CNBC directing us to this blog post. Google declined an on-camera interview with CNBC.
But this was not the end to Google's privacy problems. This headline just dropping on Google that the company still does allow other companies to scan and share data from Gmail accounts. This according to The Journal, citing a letter to U.
S. lawmakers in which Google says that the company does allow app developers specifically to scan Gmail accounts. Even though, the company, remember, itself stopped the practice for the purpose of ad targeting last year.
A month later, Google issued new privacy policies that put limits on how developers can use Gmail data. One of the interesting things about Gmail is that even when this controversy about privacy was unfolding and kind of blowing up, more and more people started to use it. And it was just so much better than anything else that was out there that that's really when people started to say, you know, maybe there is a privacy concern.
Maybe I am concerned about this, but this service is so good that I'm using it anyway. Privacy became a hot-button issue in 2018 as numerous tech companies, including Facebook, Amazon, Apple and Google were grilled by Congress about consumer data privacy. With Americans carrying their phones with them virtually at all times, doesn't the collection of this volume of detailed information really mean that Google is compiling information about virtually every movement an individual with a smartphone is making every hour of every day today?
For any service we provide our users, we go to great lengths to protect their privacy and we give them transparency, choice and control. In addition to email, users of Gmail have access to a number of free applications, including Google Sheets, Google Docs, Google Drve and Google Hangouts, among others. When you have Google Apps associated with Gmail, it's quite sticky, right?
If you're using Google Apps associated with Gmail, you're probably not going to move. Google took office tools to the web and forced Microsoft to do the same. Microsoft Office Web Apps became available to the general public in 2010 and included free lightweight versions of programs like Microsoft Word, Excel and PowerPoint.
But while Outlook may trail Gmail and Google Apps on the consumer side, Microsoft's business suite offering, Microsoft Office, still reigns supreme in the $18 billion market for business productivity tools. In more recent years, Google has also come out with a paid version of its online apps called G Suite. G Suite includes all of Google's free office tool apps, as well as additional features such as the ability to create a custom email domain and admin controls that are aimed at businesses.
Outlook and Gmail are similar in the sense that they both have free and premium tiers as well as business tiers, but they're different in terms of where their sweet spots are. I would say that Outlook is widely used within businesses and government agencies and Gmail is more popular overall with consumers. Microsoft Office still holds 87.
5 percent of the business productivity tool market compared to G Suite, which holds 10. 4 percent. But Google is working to change that.
Google unveiling its first Gmail redesign since 2013. The overhaul has a slew of new features designed to attract businesses to take on Microsoft's Outlook. Google says it now has more than 5 million paying G Suite customers compared to Microsoft Office 365, which has more than 200 million paying customers.
I think Gmail absolutely is coming up in the corporate world and it is happening as Google is taking G Suite into businesses, government agencies, schools and saying use this. Oftentimes, use this instead of Microsoft Office. And soon, Gmail's revenue stream from consumers may also get a bump.
Many free users are quickly reaching their 15 gigabyte storage limit, which is shared between Gmail, Google Drve and photos, and finding that they need a paid subscription to keep everything on the cloud. 15 years later, Gmail's big bet on storage may really pay off.
