A top secret government program, code-named PRISM, exposed that the government is directly tapping into the servers of Google, Facebook, Microsoft and Yahoo, among other technology companies, and reading emails, documents, audio and video chats, and other private communications, in a move to spy on terrorists. The companies deny that the government has such direct access, claiming that they only give out data when they are required to do so by law enforcement and respond on a case-by-case basis. The Guardian and The Washington Post broke the story this week after they obtained slides from a training presentation for the …

Microsoft took to Twitter to announce the official close of its Hotmail service. The official account of Hotmail sent its last tweet on Tuesday, encouraging followers to follow a new @Outlook account. Microsoft has completed migrating all of its email users from Hotmail to the new Outlook.com service, which now has more than 400 million accounts, many of which came from hotmail. The new Outlook email tool has features that Hotmail never had including: two-factor authentication, an app and integration with Skydrive and Skype.

After news that Salesforce.com agreed to acquire digital marketing services company ExactTarget for $2.5 billion this week, investors are speculating about who will be next. According to a report in Bloomberg, Responsys and Constant Contact could be next. Like ExactTarget, both companies started as email service providers and have expanded to offer other digital marketing tools for mobile and social media as consumer adoption of these channels have increased. According to Bloomberg, "Both Responsys and Constant Contact are projected to boost revenue by more than 55 percent in the next three years as more businesses turn to e-mail, mobile and …

The average order value of online orders that stem from email marketing messages jumped 14.4% in the first quarter of 2013 to $182.92 from $159.93 in Q1 2012, according to a new study from Experian Marketing Services. According to the report, which includes analysis from emails sent by Experian CheetahMail clients during Q1, more than half of all emails opened were opened on mobile devices.

The number of email marketing messages sent during the first half of 2012 was up 46% from the comparable time period in 2011, according to a new report from The Direct Marketing Association. This increase in volume was driven by an increase in the number of email marketing campaigns that a companies sent. The number of campaigns sent rose 57% to 12,937 campaigns during the time period. In addition, the report revealed that conversion rates from email overtook search by 60%.

Gmail's new automatic filtering tools, which let users decide which emails land in which folders before they arrive, has had some marketers concerned that their messages will get through. The new format could even hurt social networks like Twitter and Facebook, argues Tom Simonite in a piece for MIT Technology Review. "They rely heavily on email to pull people back into their services (Twitter is particularly aggressive in using emails, in my experience) and the new Gmail means those messages won't reach a person unless they click over to the 'Social' inbox tab," he writes, pointing out that updates from …

Free shipping promotions were the main focus for retailers during the 2012 Cyber Monday holiday, according to a new report from Innotrac. According to the SmartHub 3.1 November 2012 Cyber Monday report, 69% of retailers offered some kind of free shipping option as long as consumers met a certain order level and 46% offered free shipping on all orders, no matter what the price.The report also revealed that retailers earned $1.47 billion in sales on Cyber Monday, which represented a 17% growth over 2011.

Email marketing services company StrongMail has released a new set of tools for email marketers looking to reach consumers on their mobile phones. The tools allow marketers to analyze email engagement at the device level. According to research performed by StrongMail, only fifty-six percent of businesses are currently conducting mobile marketing. The rest lack resources and strategy.

After yesterday's big acquisition news, ExactTarget's CEO Scott Dorsey sent out a memo on Tuesday telling employees that the company would likely remain an independent company and would keep its headquarters in Indianapolis. San Francisco-based Salesforce.com announced that it would buy the digital marketing services firm for $2.5 billion in cash. ExactTarget currently employs more 1,800 workers and has plans to add more than 500 more workers by the end of 2018. But analysts point out that the acquisition may result in layoffs of administrative personnel, such as human resources and accounting employees.

Google updated the Gmail for iPhone and Android apps this week, adding its new auto-categorized emails for updates, promotions, newsletters tabs to the app. Users who have already enabled these tabs to their Gmail accounts will now be able to see a summary of these updates in their mobile Gmail inbox. The feature helps consumers organize their messages into subcategories before they are delivered so that they are not overwhelmed with messages.