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Updated Tuesday, February 19, 2013 at 12:55 PM

Microsoft starts big ad push for Outlook.com email

By Janet I. Tu
Seattle Times technology reporter

For Outlook.com, the time has come to end previews and take the stage for real.

Microsoft debuted its free, Web-based email service to the public in preview form last July. Since then, according to the company, it has gained 60 million active users.

And Tuesday, Microsoft is removing the “preview” label and launching a big global ad campaign for
Outlook.com.

“It’s the largest ever campaign for free email from Microsoft, and probably for all free email,” said Dharmesh Mehta, a senior director for Outlook at Microsoft.

Mehta declined to specify how much the company is spending on the ad campaign, but said it’s “tens of millions” of dollars and will include TV, radio, online, bus and train ads.

Why the big push?

”We think it’s the best free email out there,” said Mehta.

It’s also part of the company’s move toward more tightly integrated and branded products and services.

Outlook — which is used mainly by businesses — is a well known Microsoft brand associated with email. So extending the brand into the consumer realm with Outlook.com made sense.

Microsoft wanted to have “one brand for email,” Mehta said. “You have Outlook in the workplace. We want to reach people in both parts of their lives.”

Outlook.com could also serve as an entryway for consumers to other Microsoft offerings, given how integrated it is to products such as SkyDrive, Microsoft’s personal cloud service.

“Your choice of email influences your choices of other things: productivity and product solutions, how you share,” Mehta said.

It’s all part of Microsoft’s “better together” strategy that’s coming together, said Wes Miller, an analyst with independent research firm Directions on Microsoft.

“This year, we can expect a significant push from Microsoft on all cloud fronts,” including Outlook.com, SkyDrive, Office 365 [the company’s new subscription-based version of its productivity suite] and Windows Azure cloud platform,” Miller predicts.

Outlook.com is essentially the replacement for Hotmail, the free online email service launched in the 1990s that Microsoft bought in 1997.

With the formal launch of Outlook.com, Microsoft will also begin migrating Hotmail users — about 350 million, according to Mehta — to Outlook.com.

Hotmail users can choose to sign up for new Outlook.com accounts now. Or they can be migrated over without having to do anything, keeping their Hotmail email addresses, contacts lists and settings.

Microsoft plans to finish the migration by summer.

In addition, the push for Outlook.com is also a competitive move by Microsoft against Google, with its Gmail and other productivity offerings such as Google Docs and Google Apps.

Of the 60 million current Outlook.com users, Mehta says, about a third come from Gmail. (Although it’s possible at least some use both.)

Google did not immediately respond to an inquiry about the number of Gmail users. But the company did say in June there were
425 million active Gmail users, according to news accounts. Yahoo! Mail currently has about 105 million daily active users.

In recent days, Microsoft has ramped up its campaign against Gmail, launching a negative “Scroogled” campaign last week that accuses Google of going “through every Gmail that’s sent or received, looking for keywords so they can target Gmail users with paid ads.”

Microsoft’s Scroogled site even has a link to a petition asking people to “stop Google from going through personal email to sell ads” — a petition that, as of Tuesday, had about 6,800 signatures of its goal of 25,000.

Google has said it uses software that scans emails for words that it can then use to tailor ads to you, but that no actual people read your emails.

”You try all kinds of techniques to get people to look at your services, for better or worse,” said analyst Miller. “I’m not a big fan of the Scroogled campaign. I don’t think dissing a competitor is the right way to sell your product.”

Outlook.com does not show ads during personal email communications (meaning when users email someone in their contacts list), Mehta said.

Microsoft will show ads during commercial email communications, focusing on things the user has clicked on before, Mehta said.

Janet I. Tu: 206-464-2272 or jtu@seattletimes.com. On Twitter @janettu.


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