Today, TechCrunch ran a post on webmail providers’ policy regarding deletion of inactive e-mails. Jason Kincaid argues that while the cost of storage for these providers are way down and incredible amounts of storage space are given to users for free, these deletion policies are not relevant anymore because it doesn’t cost much for these providers to retain the inbox of inactive users. Well, if you assume that the overarching objective of a free webmail provider is financial concerns, that argument may be valid. Yet, the policy has little to do with keeping the costs down for a webmail provider. Instead, it serves to help the webmail providers deliver their strategic objectives. What are these strategic objectives, then? These are number of active users, number of logins per day/week/month, total e-mails read, and some other non-monetary metrics. Why are these metrics important? Because these metrics help the webmail providers negotiate large scale contracts with the advertisers.

In that sense, the inactive account policy acts like a switching cost. Switching cost is the burden for a user if she is to stop using a service and start using another. The web is filled with a variety of smartly-designed switching costs. Facebook swiftly prevents users to export their contact lists, because the largest burden of moving from one social network to another is the effort of building the same friend links in the new social network. E-mail forwarding is a great tool to switch from one e-mail to another, and that is exactly what Hotmail uses as a switching cost. You can set up an e-mail forwarding address for your Hotmail account, as long as that target e-mail address is another Microsoft property. Similarly, the inactive account policy represents a burden for the user. It is a serious punishment for the user if that user decides not to login to her webmail address for that amount of time. Although the cost of retaining that user’s inbox on the servers is not material, the cost of losing an active user is a material cost for the webmail provider. With that in mind, it is not hard to see that all major, free webmail providers choose to keep in place some deletion policy regarding inactivity.