Yahoo Inc. (YHOO) plans to offer unlimited e-mail storage to its roughly quarter of a billion users, starting in May, it said on Tuesday.

The world's biggest e-mail service is scrapping its free e-mail storage limit of 1 gigabyte, or about a billion bytes of data, responding to explosive growth in attachment sizes as people share ever more photos, music and videos via e-mail.

Microsoft (MSFT) has a 2 gigabyte free e-mail storage limit, while Google (GOOG) caps its Gmail service at 2.8 gigabytes.

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"We are giving them no reason to ever have to delete old e-mails," Yahoo co-founder David Filo said in a phone interview. "You can keep stuff forever."

Officials said the decision to remove e-mail storage limits reflects the plunging cost of storage as new personal computers store up to a trillion bytes of data and owners of 80-gigabyte iPods can carry 100 hours of video in their pockets.

By contrast, when Yahoo first introduced its e-mail service a little under a decade ago, it capped individual storage at 4 megabytes per user.

At that time, an "ultra high-density" floppy disk for personal computers then held 144 megabytes.

"People should think about e-mail as something where they are archiving their lives," said Filo, who remains active in managing technical operations at the Sunnyvale, California, company and carries the honorific title of Chief Yahoo.

Starting in May, the changeover to unlimited storage should take a month, said John Kremer, vice president of Yahoo Mail.

"We have been closely monitoring average usage. We are comfortable that our users are far under 1 gig(abyte), on average," Kremer said by phone. "What we see are an increasing number of rich media files as consumers send more photos."

[There was nothing on the Yahoo Mail Web site about the change, but some blogs reported that Yahoo would refund Yahoo Mail Plus customers, who pay $19.99 per year for 2 gigabytes, the annual fee if they asked for it back.]

One caveat Yahoo makes is that the offer is for personal use and subject to guidelines against abuse that apply to Yahoo Mail. No one can build a business giving away unlimited storage to other consumers using Yahoo Mail, executives said.

Two countries — China and Japan — are excluded.

"We will continue working with these markets on their storage plans," Kremer said in a statement.

Yahoo is a minority owner with partner Softbank in Yahoo Japan Corp. and a part owner with Alibaba of the Yahoo business in China.

Filo said Yahoo is looking at lifting caps on storage for other services such as its Flickr photo-sharing service.

"We are looking at those on a case-by-case basis," he said.

It's a far cry from when giving away 2 megabytes of data was considered a big deal, said David Nakayama, Yahoo's group vice president of engineering and developer of RocketMail, which Yahoo acquired and relaunched as Yahoo Mail in 1997.

In a posting to Yahoo's corporate blog, he said capacity when Yahoo Mail started was 200 gigabytes for all customers.

"I remember getting in a room to plan our RocketMail launch over a decade ago and worrying that our original plan of a 2 megabyte quota wasn't enough, and that we needed to be radical and DOUBLE the storage to 4 megabyte per account!" he wrote.