It wasn't that long ago that free email accounts were so totally taken for granted that everyone seemed to have several of them. I remember personally owning dozens of Yahoo!, AltaVista, Mail.com and Hotmail accounts (among any others), each with their own special purpose.
Even internet marketing books recommended having several free email accounts for promotional activities. You see, many "free" advertising-related activities require an email address so that spam can be sent. The exchange is you get a little free advertising and you agree to receive some useless, silly promotional messages. You cannot just put in a fake email address as this would be detected, so typically you would create a free email account just for purpose. Who cares how many messages get set to an account which will never be read?
This, of course, violated purpose of free email accounts, which is to display banner and other advertisements as people read their email messages (many of these free accounts also send spam messages of their own to their subscribers as well). Tons of mail dumped into accounts which are never read generate no money for email services.
Nonetheless, in heyday of free accounts this was a minor inconvenience. Ah, those were days, when businesses would pay major dollars for banners!
In fact, in an even greater perversion of this phenomenon, a few email services popped up which actually paid for people to read email messages. I don't mean those "services" which paid to send you email messages from advertisers; no, I mean you got paid a small amount for every single message, regardless of who it was from, that you read in web-based email client. The concept was that advertisers would pay for you to look at banner ads that displayed at same time as messages.
It was even touted among "experts" that free email services such as Hotmail was an incredible thing called viral marketing. The concept here was that every message you send using service has a link to join service. This gives every single person who reads a message a chance (and often many chances) to join themselves. Millions (and perhaps tens of millions) took advantage of these offers.
Of course all of this failed to take into account a very basic fact: it really doesn't matter how many people use service if money is not being made. In fact this proved very true when internet bubble burst; more users suddenly meant more money being lost.
The long overdue death of banner ad as a viable means of promotion foreshadowed failure of many internet businesses. Those with exceptionally poor business models, such as AllAdvantage, fell fast. These were soon followed by merely idiotic (such as TheVines), grandiose (such as Kozmos and WebVan) and merely poorly financed (most of internet companies).
The inevitable is finally catching up with world of free email services. These days announcements seem to be coming almost daily from all of major services: Yahoo, Hotmail, Mail.com and Altavista. They are either attempting to force their users into paid services or are closing down entirely.
Many of these services are finding that they can survive by providing free basic accounts with extra charges for "special" features. The most common "extra feature" is POP3 access (meaning reading email from your email client). The rationale is free service cannot make money from POP3 accounts as no advertisements are shown. This is, of course, a very weak argument because services do place ads in email messages.
Another common "extra cost feature" is large attachments. The free email services seem to believe that only a small percentage of people use attachments of over, say, a few hundred kilobytes to a few megabytes. They reason that if this is desired users can pay extra.
The problem is, well, that most of these free email services are worth exactly what they cost: nothing. Free email services are fat, dumb and lazy. If you don't believe me, just try getting customer support! Their paid versions will almost certainly not be any better, and it appears to me to be exceptionally overpriced as well.
So what are alternatives?
One of few free email services that is worth anything is Mail.Com. I have used this service many times and have had good luck. Their free version is fast, easy to use and simple, although they do charge extra for POP3 access. I like their web based mail system, although their free service does require advertisements. You can eliminate these advertisements for less than $10 per year if you so desire.