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Hotmail is one of the popular free 'webmail' email services, which are accessible from anywhere on the planet via a standard web browser. It was founded by Jack Smith and Sabeer Bhatia in 1995, and was commercially launched on July 4th, 1996, Independence Day of the USA, symbolically representing freedom from ISPs.

Hotmail offers many of its members 250MB of free e-mail storage, be it used for sent or received e-mail. For a fee, customers can get 2GB of storage. In contrast, Yahoo! Mail offers 1GB for free currently, to all of its members with 2GB offered at a price, Gmail from Google offers over 2GB for free.

Jack Smith first had the idea of accessing e-mail via the web from a computer anywhere in the world. When Sabeer Bhatia came up with the business plan for the mail service, he tried all kinds of names ending in 'mail' and finally settled for hotmail as it included the letters "HTML" - the markup language used to write web pages. It was initially referred to as HoTMaiL with selective upper casing.