Search engine Google Inc. announced Wednesday it will launch a free, Web-based e-mail service to compete against popular services from rivals Yahoo! Inc. and Microsoft Corp.
Google's service, called "Gmail," will include a built-in search function that will let people search every e-mail they've ever sent or received.
According to company executives, users will be able to type in keywords to sort e-mails or find old missives. And it will come with 1 gigabyte of free storage - more than 100 times what some popular rivals offer and enough to hold 500,000 pages of e-mail.
The service is being offered to invited users, and will be available to everyone in a few weeks, the company said.
Officials at Yahoo and Microsoft's Hotmail division declined to comment on Google's entry into a new category.
But analysts said that Google -- whose technology is behind nearly four out of every five Web searches -- could shake up the free e-mail market.
Yahoo dominates the niche, with 52.6 million unique users per month in the United States, according to a February survey by online research firm comScore Media Metrix. Hotmail is next, with 45.4 million users. AOL has 40.2 million paying users.
To finance the service, Google will display advertising links tied to the topics discussed within the e-mails. For instance, an e-mail inquiring about an upcoming concert might include an ad from a ticket agency.
Industry analyst David Ferris said Gmail is a logical extension of the world's most popular search engine. But he said Google may run into trouble if it tries to charge for e-mail eventually.
Rivals have kept stripped versions of e-mail free and asked users to pay annual fees up to $30 or more for extra storage and spam protection.
"I know that companies offering free e-mail are very frustrated because the consumer expects it will stay free -- they simply will not pay any money for them," said Ferris, president of San Francisco-based Ferris Research. "Although there's a clear tendency for these free services to offer for-fee extensions, users are very resistant to taking them up. The level of adoption is very disappointing."
I cannot wait for this!