Will Facebook's E-Mail Service Demolish Gmail and Hotmail?

The huge potential of Facebook Mail

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The cat's out of the bag. According to reports at TechCrunch and ZDNet, Facebook is going to unveil a full-fledged e-mail service to compete with Gmail, Hotmail and other web-based e-mail services. Code named "Project Titan," the company will likely unveil the service at an invite-only event on Monday.

The e-mail product, which employees colloquially call the "Gmail killer," significantly escalates Facebook and Google's battle to be the dominant hub of the Internet. And given Facebook's immense popularity, its e-mail service has a real shot at attracting a wide user-base. Here's what tech and business writers are saying:

If true, this will mark a change for Facebook, which is used to operating in a closed environment. With email, the social network will have to allow people outside Facebook to contact people inside Facebook, and vice versa. Almost every feature of the network so far has been to get people onto the site and staying there. However, it could be a smart move. By adding email, users will have one more daily activity to do within the walls Mark Zuckerberg has built, even if they are speaking with those who haven’t yet drank the Kool-Aid. It is rumored that all users will get an @facebook.com email address.

  • This Is Going to Crush the Competition, writes Henry Blodget at Business Insider:

Given that Facebook has already replaced email for many younger Internet users--and become the "start-page" and communications hub for many of the rest--it makes great sense for Facebook to offer a full-fledged email product.

If Facebook offers a good email platform (easier said than done), the product could gradually have a devastating impact on Gmail, Yahoo, AOL, Hotmail, and other email systems.

In so doing, it could also hammer their financial performance. Yahoo and AOL, especially, generate an enormous number of page views (and, thereby, ad impressions) from their email users. As these users migrate to other platforms, they take their impressions with them.

Facebook already has a treasure trove of personal information and a huge messaging platform. If they throw email into the mix, this may become a real threat to Gmail. It would also make Facebook even "stickier" than it is – or provide people like me with one more reason to keep their distance from the privacy-invading behemoth.
  • I Will Never Sign Up for This, writes Frank Reed at Marketing Pilgrim:
There is no chance on this earth that I would trust Facebook with this valuable piece of my online life. No way. They have done nothing to earn an ounce of trust with their “Oh we’re sorry we didn’t know that was an egregious breach of privacy so we won’t do it again ….. wink, wink, nod, nod” approach to me as a Facebook user. Call it “Once bitten twice shy” or “Fool me once shame on you, fool me twice shame on me” but there is more than enough anecdotal evidence to say that anyone trusting Facebook implicitly with even more data is a fool.
  • This Was the Logical Next Step for Facebook, writes Jason Kincaid at TechCrunch:

Facebook has the world’s most popular photos product, the most popular events product, and soon will have a very popular local deals product as well.  It can tweak the design of its webmail client to display content from each of these in a seamless fashion ... And there’s also the social element: Facebook knows who your friends are and how closely you’re connected to them; it can probably do a pretty good job figuring out which personal emails you want to read most and prioritize them accordingly.

With more than 500 million users, Facebook is larger than Yahoo! Mail, Hotmail and Gmail... if Facebook manages to integrate the new messaging system tightly with the main interface, it might find quite a few takers.

It's hard to get people to switch e-mail services, though. Google's Gmail is the present darling of the techno-in-crowd, even to the point that the trend-mocking Stuff White People Like blog asserts that having a Hotmail, Yahoo Mail, or AOL e-mail address is grounds for breaking up. Yet those older services still have tens of millions of active members. Inertia is a powerful force, especially when it comes to the hassles of changing your contact information with friends, banks, airlines, retailers, business contacts, and countless other organizations that use your address.

The big unknown, though, is what Facebook e-mail could supply beyond an inbox and address book. Gmail genuinely innovated with storage capacity, the ability to archive e-mail, secure communications by default, and customization through labs features. What might Facebook accomplish, especially given its quantitative knowledge of who is most important to whom in the social realm?

This article is from the archive of our partner The Wire.