Hotmail: Free Email, Anywhere, on the Fourth of July
Two engineers built email you could read from any computer, launched it on Independence Day 1996 and sold it to Microsoft 18 months later.
By the InterStalgia history desk · November 14, 2026
In 1995 your email lived with your internet provider or your employer. Change jobs or switch providers and your address went away, and you could usually only read your mail on the computer where your email program was installed.
HoTMaiL
Sabeer Bhatia and Jack Smith founded Hotmail in 1995 to fix that. Their idea was email that lived on a website, so you could read it from any computer with a browser. They chose the name out of many ideas ending in "mail" because it contained the letters HTML, the language web pages are written in. To make the point, the original logo was spelled HoTMaiL.
The company started with about $310,000 from the venture firm Draper Associates. Hotmail was one of the first webmail services on the internet, alongside Four11's RocketMail, which later became Yahoo Mail.
Independence Day
Hotmail launched commercially on July 4, 1996. The date was a deliberate joke with a point: freedom from your internet provider's email, and the ability to check your inbox anywhere in the world. It was free, and it caught on fast. By December 1997 Hotmail said it had more than 8.5 million subscribers.
Microsoft buys in
In 1997 Microsoft bought Hotmail for an estimated $400 million and made it part of MSN, as MSN Hotmail. The service kept growing as it was translated for markets around the world. By February 1999 it had more than 30 million active members and was the largest webmail service in the world.
Hotmail is still around. In 2013 Microsoft moved its users to a new service called Outlook.com, and plenty of people still have the @hotmail.com address they made in the 1990s. Web email, the idea that once needed a holiday launch to explain, is now just how email works.