Applications
SHARE
Facebook X Pinterest WhatsApp

Google: Gmail Success Spells SaaS Superiority

SAN FRANCISCO — Google may dominate in search, but it’s the company’s free consumer e-mail service, Gmail, that it sees capable of teaching the enterprise some lessons. Google (NASDAQ: GOOG) shook up the e-mail world in 2004 with the release of Gmail, it’s free e-mail service. Microsoft’s Hotmail and Yahoo ruled the roost, but their […]

Written By
thumbnail David Needle
David Needle
May 21, 2008
Datamation content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More

SAN FRANCISCO — Google may dominate in search, but it’s the company’s free consumer e-mail service, Gmail, that it sees capable of teaching the enterprise some lessons.

Google (NASDAQ: GOOG) shook up the e-mail world in 2004 with the release of Gmail, it’s free e-mail service. Microsoft’s Hotmail and Yahoo ruled the roost, but their standard online storage limit was 10 megabytes — if you wanted 100 megabytes or more you had to pay.

But when Gmail debuted with a gigabyte of free storage, competitors scrambled to respond. And while it’s unclear how they’re fairing — both Microsoft (NASDAQ: MSFT) and Yahoo (NASDAQ: YHOO) have larger user bases, but don’t break out revenues for their e-mail offerings — Google has been known to crow about its successes.

“We’re making money,” Matthew Glotzbach, product management director for Google Enterprise, told Internetnews.com.

Added a Google public relations spokesman, “Gmail is absolutely profitable.”

The secret? A very favorable market for commodity storage hardware and the economics of scale — two trends that it sees encouraging enterprises to similarly trade up to software-as-a-service (SaaS) offerings like hosted e-mail.

While Google’s audacious offering was great for consumers, it was less immediately clear it would be a successful business, particularly as storage costs initially increased. As its popularity rose, the increasing amount of large multimedia files users were sending and storing on its servers meant their needs soon grew beyond the once “massive” gigabyte of storage it originally offered.

Market dynamics enabled Gmail’s free storage to keep pace, growing at such a pace that it’s essentially open-ended.

At present, Gmail storage is “up to six to 7.5 gigabytes per user on average,” Glotzbach said during his keynote address here at the Software and Information Industry Association (SIIA) NetGain conference today.

In his presentation, Glotzbach showed a graph of how storage costs have plummeted since 2004, even as Gmail’s ad revenue has risen, with the two axes crossing in 2008.

This article was first published on InternetNews.com. To read the full article, click here.

  SEE ALL
APPLICATIONS ARTICLES  
thumbnail David Needle

David Needle is a veteran technology reporter based in Silicon Valley. He covers mobile, big data, customer experience, and social media, among other topics. He was formerly news editor at Infoworld, editor of Computer Currents and TabTimes, and West Coast bureau chief for both InformationWeek and Internet.com.

Recommended for you...

thumbnail 8 Best Data Analytics Tools: Gain Data-Driven Advantage
Big Data
8 Best Data Analytics Tools: Gain Data-Driven Advantage
Kezia Grace Jungco
May 23, 2024
thumbnail Common Data Visualization Examples: Transform Numbers into Narratives
Big Data
Common Data Visualization Examples: Transform Numbers into Narratives
Liz Ticong
May 20, 2024
thumbnail 10 Best Cloud-Based Project Management Software Platforms of 2024
Cloud
10 Best Cloud-Based Project Management Software Platforms of 2024
Leon Yen
May 14, 2024
thumbnail HubSpot CRM vs. Salesforce: Head-To-Head Comparison (2024)
Applications
HubSpot CRM vs. Salesforce: Head-To-Head Comparison (2024)
Kezia Grace Jungco
Apr 30, 2024
Datamation Logo

Datamation is the leading industry resource for B2B data professionals and technology buyers. Datamation's focus is on providing insight into the latest trends and innovation in AI, data security, big data, and more, along with in-depth product recommendations and comparisons. More than 1.7M users gain insight and guidance from Datamation every year.

facebook
youtube
x

Company

About us Contact us Advertise with us

Categories

Trends Big Data Data Center AI Cloud Applications Mobile Open Source Security Storage

Property of TechnologyAdvice. © 2025 TechnologyAdvice. All Rights Reserved

Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

Terms of Service Privacy Policy California - Do Not Sell My Information