Yahoo Mail took the lead by offering unlimited storage space to all users. Gmail has apparently started giving out 9 GB for some users. And now, it’s Microsoft’s turn. They have just announced some new improvements to Hotmail.
First and most importantly, they are now giving all users 5 GB of storage (10 GB to paid users). They’ve have also worked upon the performance and now it’s reasonably fast. There are plenty of other improvements as well, but it’s not worth mentioning. Click here for a full list of features and improvements.
Don’t worry if these new features won’t immediately reflect on your account. Windows Live Hotmail team will be slowly rolling out these features to all customers.
Some 5 years back, I was a loyal Hotmail user, but ever since I switched over to Gmail, I never really looked back at Hotmail. I still remember those days when they used to provide mere 5 mega bytes of Storage. I can’t imagine myself deleting my emails, like I used to do before switching to Gmail.
In my opinion, it’s not just about the storage space. Companies like Microsoft, Yahoo or even Google for that matter should try to improve upon the usability of their service. Providing storage isn’t any good unless the service is usable. I think Gmail is the best so far in terms of usability. However, both Yahoo Mail and Windows Live Hotmail have pretty sleek and good looking user interface.
It’s pretty interesting to note that Gmail, which stood as the largest mailbox provider (when first launched three years ago) is now standing in the last position. [Even though some users have been noticing 9 GB storage space, Gmail officially didn't announce anything].

wrote, on August 15th, 2007
Good news for me! I have never used any other email system than Hotmail. Saves me a lot of hassle. Although, I admit I would like to try out GMail. I have heard a lot of nice things about them
wrote, on August 18th, 2007
Great for MSN users! But i will stay at gmail for sure.