Israeli Web portal Walla plans to launch a free e-mail service that gives each user one gigabyte of memory, which it said on Wednesday could affect the revenue models of other service providers.
Walla said it hoped to be the first company in the world to provide e-mail with such a large capacity, which could be a marketing coup when it makes the service available in two months.
The Walla announcement comes after Google Inc, the world's most popular Internet search engine, said it would soon launch a free email service with one gigabyte of storage capacity, called Gmail.
"We are hoping to be ahead of Google," a Walla official said.
Walla gave no details about investment in the project. It said the expanded e-mail boxes would not generate revenue primarily through advertising.
"This goes against today's prevailing trend whereby companies seek to increase their average revenues per user through value-added services to end-users," the statement said.
Its service will also include anti-spam and anti-virus protection, Walla said.
One gigabyte of memory is more than 100 times that offered by established rivals Yahoo Mail and Microsoft's MSN Hotmail.
Walla said it had a customer base of 750,000 users. Its 2003 revenues reached 33 million shekels ($7.2 million), up 43 percent from the previous year.
Gross profit in 2003 totalled 19 million shekels, up 116 percent from the previous year, it said.
Google's Gmail came under fire on Monday when an international privacy rights group said it would violate privacy laws across Europe and elsewhere.
The group objected to Google's plan to automatically scan Gmail for keywords to use in sending targeted advertisements to consumers and to keep copies of e-mails after users deleted them.