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Microsoft has overhauled Hotmail, its flagship web-based e-mail

service, in the service's most fundamental upgrade since its launch.

In a move designed to encourage users to develop a commercial

relationship with MSN, Hotmail has been integrated much more closely

with the company's MSN internet portal.

An MSN page offering a variety of MSN services, including mobile

ringtones and links to retail partners, now greets users after they have

logged in successfully. Before now the service took users straight to

their e-mail inboxes.

The move is a bid by MSN to get more value out of its army of worldwide

users. MSN claims to have 6.4 million customers in the UK and just over

110 million worldwide.

MSN has added a number of features, including a more sophisticated

anti-spam filter, which allows users to set their filtering of junk mail

at four different security levels. It also invites customers to download

an MSN-branded version of Microsoft's Internet Explorer.

"The old interface looked dated, but this version is cleaner in layout

and easier to navigate around," said Matt Whittingham, business

marketing manager at MSN UK.

"We are trying to integrate more closely with the MSN network but are

keen that Hotmail doesn't get cluttered with superfluous content."

Whittingham added that many Hotmail users are unaware the service is

owned by MSN.

Rebecca Ulph, senior analyst at Forrester Research, said: "Hotmail is an

enormous driver of internet traffic and it's free.

"MSN has been faced with the dilemma that it has all these users that

are not returning any of their investment. This is a blatant way to push

users through to MSN.co.uk."

MSN awarded its global above-the-line creative account to

McCann-Erickson last year to replace Euro RSCG Wnek Gosper, with

Universal McCann responsible for media planning and buying. The company

uses AKQA as its online creative agency, with online media handled by

Media Contacts.