Google Takes a Big Step to Expand Its Offerings
Google Inc. plans to double the capacity of its e-mail in-boxes today as the online search giant ups the ante in its fight with Microsoft Corp. and Yahoo Inc. for the loyalty of Web surfers.
Google plans to give users of its Gmail service 2 gigabytes of storage for messages, digital photos and other attachments. The company plans to continue expanding the limit as fast as technology allows, a Google executive said Thursday.
The move is a nod to the day when people will be able stash reams of digital goodies -- music, movies and other files -- online.
Many people, of course, will never come close to storing that much data. Yahoo spokeswoman Karen Mahon suggested that Google’s hike may afford it little more than bragging rights: “For many e-mail users, anything beyond 1 gigabyte is just a number. It’s like adding a bucket of water into the ocean.”
But a Google executive said some users already had hit the threshold or come close, and many more increasingly are using Gmail to send themselves Word documents, photos and other digital files that they want to access from other computers.
“We hope it’s a change in how people think about this part of e-mail,” said Gmail product development director Georges Harik.
Google’s upgrade comes on the one-year anniversary of Gmail’s launch and underscores the race between the company and its rivals. Even as the prices of data storage systems drop dramatically, Google is investing heavily to create an unmatched storage network to attract users and attack competitors.
The Mountain View, Calif.-based search giant disclosed Wednesday that it planned to spend $500 million this year on computers and other equipment, a 57% jump from last year, to offer new services.
“Its infrastructure, not just search technology, is its most important competitive strategic advantage,” UBS Investment Research analyst Ben Schachter wrote in a report.
Other Internet giants have failed to keep up. Yahoo and Microsoft offer 250 megabytes to users of their free e-mail services. Yahoo is upgrading to 1 gigabyte at the end of April and charges $19.99 a year for 2 gigabytes of storage.
The more customers use Gmail to store their files, the less likely they are to switch to other free e-mail services, said Tim Bajarin, principal analyst with Creative Strategies Inc.
He and other analysts said it was no stretch to think that Google might use its vast network to take that one step further and create an online storage service that copies computer files and makes them available through any Web-connected device. It already offers a desktop search program that indexes the contents of computer hard drives.
“There’s no question that they would like to be the center of your digital life,” Bajarin said.
Google also hinted in its annual report at another growing battleground for Net titans: maps and driving directions. In documents filed with the Securities and Exchange Commission, Google said it spent $56 million in cash and stock to acquire four companies last year. It did not name them in the filing, but a spokesman said three of the four related to mapping services.
The company had publicly announced the acquisition of Keyhole Corp., which uses aerial and satellite photos to let users zoom in on particular places. But it had not disclosed the acquisition of Zipdash, whose service delivers real-time traffic conditions to mobile phones, or of Where2, which it used to help create its Google Maps service.
Shares of Google rose 6 cents Thursday to $180.51 on Nasdaq.
