Yahoo! Mail’s Business Model: Charge for Basic Services

I’m feeling a little scandalized right now. I just tried to help my boss set up his Yahoo! Mail in Outlook. Should be no big deal, right? I envisioned taking the commonsense steps Settings -> Forwarding/POP/etc access -> putting in his Outlook email.

Turns out this isn’t possible with the free Yahoo! Mail. You have to spend $20/year to get the ability to forward your mail. See Yahoo! Mail Plus.

The benefits? “No graphical ads, Offline Access with POP, 200 Filters instead of 100, No account expiration, Live customer care, Mail forwarding, and Disposable addresses.”

Okay. POP access is definitely important, but I feel like Yahoo! is throwing in these other perks to try to validate the $20 fee. Unfortunately, these other things are fluff.

No graphical ads – Those are so annoying — that’s hurting Yahoo! to have in the first place and shouldn’t be used as a bargaining chip.
200 filters – Who’s using more than 100? No, who’s using more than 15?
No account expiration – I see where they’re coming from, that’s probably a drain on the system to have unused accounts, but I’d hate to feel like if I didn’t log in often enough my account would be deleted — that’s a bad feeling to put on a user, even if it is highly unlikely ever to happen.
Live customer care — how often will you ever need help with your email? And if you did, how often is it that a 3 second Google search wouldn’t solve the problem?
Disposable addresses — “Create disposable email addresses when you don’t want to give out your primary address. Messages sent to these addresses are delivered to your Inbox or to any folder you designate.” Why would I want the emails going to my mailbox at all? Seems like there are better services out there for free disposable email addresses anyway (GuerillaMail.com, Mailinator.com, Mailexpire.com…).

I guess I’m having a hard time visualizing Yahoo!’s market. What hooks does Yahoo! have that get people to use Yahoo’s mail? Why wouldn’t people just use Gmail and get all of these things (except for the live customer care and “disposable addresses,” though you can create as many for-junk-mail email accounts as you want) for free?

Is this business model working for Yahoo!? I just thought we were now in the age of Wikinomics where $0.00 is the Future of Business (Wired.com). Although there must be some people still paying for these basic services, I feel like this is indeed a dying business model. I mean, look at the stock. Today, Yahoo! is selling for $16.98 while Google’s currently at $525.59. I think that’s a pretty emphatic statement of what’s working and what isn’t.