In the yawn department, Microsoft will raise its e-mail storage limits at Hotmail, offering free users 250 megs and premium customers ($19.95 per year) 2 gigabytes. these terms slightly better Yahoo!'s recent enhancement, which offers 100 megabytes to free users and 2 gigs to premium users.

"The playing field has changed," said Blake Irving, vice president of communication services and member platform for MSN. "We're going to take storage off the table as an issue."

Yes, the playing field has changed, but storage isn't the issue that needs addressing. Perhaps because of Gmial's limited release, many people don't realize that storage is only one of its innovations. (Considering storage on its own, though, it must be noted that 1 gigabyte of free use is substantially more generous than 100 or 250 megs, so the storage issue isn't really off the table yet.) Gmail's conversational presentation of e-mail distinguishes the service from competing Webmail, regardless of storage allowances. Gmail is a groundbreaking Web app that redefines the e-mail experience.

Then, there is the business model, which also affects the user experience. Contextual ads alongside e-mail is the true issue on the table, which, when privacy alarmism blows over, is more likely to thrust a spear into the side of Yahoo! Mail and Hotmail than storage issues.