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1. Automatic folders
Google's Priority Inbox and Filters does all of this.

2. Mobile experience
Microsoft's Hall says that using "normal" mail clients breaks Google's Priority Inbox.

I've used non-Google email clients fine with Priority Inbox; the "special" labels just appear as IMAP folders.

3. Privacy protection
As other comments have already pointed out, GMail business accounts don't data-mine and email is sent over the internet in plain text, so anyone can intercept the data. If you want the content of email to be private then encrypt it.

4. Social integration
I like Rapportive too. Outlook.com's social integration may be a step ahead; I've not used it enough to really tell. Does it include voice chat?

Bottom line

"some really useful innovation in there"

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It seems evolutionary rather than revolutionary. I must have missed something?

I quite like the Outlook.com interface and hope that it drives google to maximize the email "window". Perhaps I need to investigate some of the gmail addins that alter the UI.

Competition is good, it drives things forward. Let's hope both services are driven to improve.

I try to be sceptic about all the corporations; I'm not suggesting that GMail is better than Outlook.com (I have GMail and Hotmail accounts), just pointing out that this Report?/Review? appears biased.

Perhaps we're to blame; we encourage hyperbole and controversy in articles because we give them more page hits.