tags: evolution contradiction control poly

Hotmail's new address | CNET News.com: "Off the back burner
Microsoft was early to spot the potential of free e-mail. Back in late 1997, it opted to spend hundreds of millions of dollars to buy Hotmail. But after that, the service remained essentially the same for a decade. Microsoft invested in more servers and additional data centers as the service grew, but Hotmail itself only saw modest, incremental changes.

As many as a fifth of the users in some test groups were opting to go back to the old version.

"It could have completely derailed the train," Schackwitz said.

Instead, Microsoft found a compromise. In its latest build, Microsoft decided to add back a "classic mode" option that essentially stripped away most of the new features. The classic mode uses the new architecture behind the scenes, but to consumers, it looks like the same old Hotmail.

"Frankly, we didn't think we were smart enough to predict what people want a year in advance," Craddock said. Instead, Microsoft's new mantra is to get new ideas out quickly, see which ones stick and then make tweaks on the fly. "We changed the way we develop software. We now ship a new service to the site every eight weeks," he added.

Consumer opinions can be very humbling, Sim said. "You feel like you've got...the best engineers building really world-class software," he said. "When you really begin to get user feedback on it, you begin to realize that some of the assumptions that you have were wrong."

With Gmail, Google managed to launch a service that is "sexy," Radicati said. Hotmail hasn't had anywhere near the same allure.

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