Microsoft to replace Hotmail with ‘’


Microsoft is phasing out its iconic Hotmail webmail service, replacing it with a new email service that combines elements of Exchange, Skype and Hotmail into one tool, as the software giant looks to regain market share lost to Google's Gmail. The revamped service will help sort messages as they arrive and allow users to make internet calls on Skype, and has been designed to tackle the problem of "cluttered" inboxes.

Watch a video explaining how the service works below: will automatically sort messages into different areas to distinguish between emails from contacts, newsletters, package delivery notices, social network posts and other identifiers determined by the account holder.

In addition it is taking steps to link the Outlook account with other services the user might have subscribed to.

"We are giving you the first email service that is connected to Facebook, Twitter, Linkedin, Google, and soon, Skype, to bring relevant context and communications to your email," the firm's Chris Jones said on its blog.

"In the inbox, your personal email comes alive with photos of your friends, recent status updates and tweets that your friend has shared with you, the ability to chat and video call - all powered by an always up-to-date contact list that is connected to your social networks."

In what may be perceived as a dig at Google, Jones added that the firm would not scan email content or attachments in order to sell the information to advertisers or others.

Web versions of the firm's Office apps are built-in, potentially helping it counter competition from other web-based application suits such as Google Docs and Zoho Docs. also links up with Microsoft's Skydrive cloud storage, allowing users to send photos and other documents via the service to avoid the risk of going over their attachment size limit.

This could pose a threat to the rival Google Drive service as well as Dropbox, Sugarsync and others.

End of an Era?

Hotmail was one of the first free web-based email services, and was founded by Sabeer Bhatia and Jack Smith and launched in July 1996 as "HoTMaiL". It was acquired by Microsoft in 1997 for an estimated $400 million, and shortly after, it was rebranded as "MSN Hotmail".

Microsoft is offering the new service in a "preview" mode for the time being and has not announced an official release date.

While it advises users to upgrade, Hotmail subscribers can stick with the old system if they wish - at least for now.

Those who do make the change keep their @hotmail, @msn or email address ending, but can also add an address to their account if they wish.

Read the official announcement from Microsoft here

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